If he decides to run, Mr Smith will be joining Angela Eagle who announced on Monday that she was challenging current Labour leader Jeremy Corbyn, who has lost the confidence of many of his parliamentary colleagues.
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He was going to say: “So now it falls to a new generation of Labour MPs to step forward and secure Labour’s future”.
Mr Dromey said: “I was born on the left and I will die on the left”.
Mr Smith’s announcement came amid reports the NEC had suspended all local Constituency Labour Party meetings until the end of the leadership campaign following complaints of harassment and intimidation.
Labour officials on Wearside are calling for calm as the party’s leadership election heats up.
She said there should be no legal challenge to the NEC’s decision but warned that Labour risks electoral wipeout in the north at the hands of Ukip, similar to that it has suffered in Scotland if Mr Corbyn remains leader.
The Labour leader addressed a crowd of around a thousand supporters at the Keep Corbyn fundraising rally after the party’s ruling National Executive Committee confirmed his name would automatically be on the ballot paper after former shadow business secretary Ms Eagle challenged him for the top job.
While she did not directly accuse Mr Corbyn of incompetence, she spoke about a meeting with party members where she explained “my view that there is nothing socialist about incompetence and that competence requires both leadership and management skills”.
Mr Smith said he supported the decision to allow Mr Corbyn on to the ballot, before rejecting claims that he would split the anti-Corbyn vote in the contest.
A second British Labour opposition lawmaker entered the contest to topple leader Jeremy Corbyn on Wednesday, boosting the veteran left-winger’s chances of being re-elected by splitting the support of those who oppose him.
Mr Smith also raised the idea of a second European Union referendum after the terms of a Brexit deal had been fully finalised.
“But I hope and I expect it will be me”. Do those who are newly joining intend to stay and work with the party and help to get the policies right, or is it just a protest vote?
“Join us in this battle, let us win the Labour Party back”.
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He said: “If he stands down and makes this leadership contest a proper contest between credible candidates capable of becoming prime minister, I will engage”.
