Prime Minister Julia Gillard says her leadership is secure after she was unopposed at a spill in caucus.
Kevin Rudd declined to stand for the leadership at the caucus meeting today, following several weeks of damaging leadership speculation.
“The leadership has been settled in the most conclusive fashion possible,” Ms Gillard told a press conference at which she made a statement but did not take questions. “It has ended now.”
Treasurer Wayne Swan remains as deputy prime minister after Simon Crean, who had earlier said he would run for the deputy's position, withdrew his nomination.
Ms Gillard thanked her colleagues.
“I accept their continuing support for me as Prime Minister and the Labor leader with a sense of deep humility and a sense of resolve,” she said.
Ms Gillard said the Government still had a lot of work to do - listing goals such as making sure Australians continued to have job opportunities, rolling out the National Broadband Network and implementing the National Disability Insurance Scheme.
“That is the purpose with which we govern,” she said.“That is what matters to Australians and it is what matters to me.”
Mr Rudd announced as he entered the party room for the ballot that he would not challenge.
Senior frontbencher Anthony Albanese backed Mr Rudd's decision.
"I believe that Kevin Rudd has made the right decision in the party's interests," he said.
Ms Gillard called the ballot after being confronted this morning by senior minister Simon Crean, who demanded a leadership spill.
Mr Crean was later sacked fron the frontbench by the Prime Minister.
As he entered the party room, Mr Rudd said said the only circumstances under which he would stand for the leadership was if there was an overwhelming majority of the parliamentary party requesting his return.
“I'm here to inform you that those circumstances do not exist," he said just minutes before the caucus meeting.
“I take my word seriously.”
Mr Rudd said to “all and sundry” across the Labor party and the Government that “we unite in ensuring that Tony Abbott does not simply walk into the Lodge as if it's his own personal property”.
At a press conference earlier, Mr Crean urged Mr Rudd to run and said he would support him in the caucus ballot and put himself forward as deputy leader of the party.
Ms Gillard stunned the start of Question Time today by saying the ALP would hold the leadership ballot.
In a dramatic move by the former leader, Mr Crean said “something” had to be done to clear the air over the Prime Minister’s position.
He called on Mr Rudd to stand against Ms Gillard, saying that he would back the former PM in any leadership ballot.
Ms Gillard, asked in Question Time by Opposition Leader Tony Abbott about the comments by Mr Crean that have prompted today's leadership spill, effectively outlined her campaign message to the ALP backbench.
"It is about being smarter, it is about being strong it is about being fairer," she said.
Mr Rudd was in Question Time.
Mr Abbott sought to move a motion of no confidence in Ms Gillard.
This was blocked on procedural grounds, forcing Mr Abbott to ask for a suspension of standing orders that would then pave the way for a vote of no confidence.
"This is about the decent, honest hardworking people of Australia who deserve a strong and stable and competent government," Mr Abbott said.
"This is about reassuring the Australian people that we are a great people and we are a great country just momentarily let down by a very poor Government.
"An incompetent and a chaotic Government which just gets worse and worse with each passing hour."
The last successful no confidence motion against a sitting government occurred in 1941 when the Fadden Government fell.
Mr Abbott rounded on Ms Gillard, saying she should go for the good of the Australian people.
"I have seen enough of politics and I have seen enough of good people on both sides of this chamber ... to have some respect for the Labor Party," he said.
"The Labor Party of which it was once said there was a light on the hill, working for the betterment of mankind.
"That once great political party is now reduced to being a political life support system for just one person - the current Prime Minister.
"I say to the current Prime Minister for your party's good you should go.
"For our country's good you should go. You should go."
Ms Gillard said Mr Abbott had failed to articulate a vision for the country in his address to Parliament.
Instead, it was filled with bitterness, negativity and the politics of personal assault.
She focused on her achievements, saying the survival of Australia through the worst aspects of the Global Financial Crisis had delivered 900,000 new jobs to the country.
"Day after day, piece after piece, we have met that challenge to create jobs for Australians," she said.
Ms Gillard touched on the provision of better pay to childcare workers, the move to a national disability insurance scheme and other measures introduced by the government over the past three years.
This had been done in the face of a hung parliament.
"This is a Government that against relentless negativity has governed for the fortunes of all Austraians and governed well,"
"We are not done yet. We have more to do to bring fairness and oppotunity into our country."
The independents voted with Opposition to suspend standing orders. The vote was passed 73 to 71 but failed to reach the 76 votes needed for an absolute majority.
The move by Mr Crean to confront the Prime Minister was the culmination of more than a week of rumours and speculation that Ms Gillard’s hold on the prime ministership had slipped, made worse by the handling of the media reform bills.
Mr Crean said there was no choice but for the ALP to take a “circuit-breaking” moment.
“Something needs to be done to break this deadlock, to resolve this issue for once and for all,” he said.