John Brumby, who taught at Eaglehawk Secondary College, wrote an almanac on Bendigo in the early 1980s and retains friends and property in the central Victorian city, yesterday nominated for leadership after Steve Bracks resigned as premier.

Deputy Premier John Thwaites also stepped down, and in so doing removed the only serious competition to Mr Brumby's claim.

"Steve and John leave Victoria in a stronger position than it has ever been and I am pleased to say they leave the Victorian Labor Party strong, full of talent and full of energy," Mr Brumby said in a statement yesterday.

"It has been an enormous privilege and honour to serve as Treasurer of Victoria under Steve.

"His commitment to working families and his determination to govern for all Victorians will long be his legacy."

Mr Bracks yesterday endorsed Mr Brumby as Victoria's next premier, and will vote for him at Monday's caucus meeting when the leadership will be decided.

"Treasurer John Brumby would be an outstanding leader of the Labor Party here in Victoria and a very, very good premier," Mr Bracks said yesterday, after announcing his resignation.

Mr Brumby has served as treasurer under Mr Bracks since May 2000, taking on the job six months after Labor won office in October 1999.

"John Brumby has been the architect of our economic success," Mr Bracks said.

"He is, by any measure, the best treasurer of any treasurer of any government in Australia currently, and I believe he is the best treasurer that Victoria has ever had."

Mr Brumby is Mr Bracks' predecessor and likely successor – Mr Bracks replaced him as Labor leader in February 1999 after the party suffered large losses to Jeff Kennett's Liberal government at the 1993 and 1996 polls.

Yesterday, Mr Brumby also drew Mr Kennett's endorsement.

"He was the individual who stood aside to give Steve Bracks the opportunity to lead the Labor Party, he was the individual who, for months before he stood down from the leadership, was personally instrumental for a change in the appreciation by people in rural Victoria as to whether they should support my government or vote for a change," Mr Kennett said yesterday.

"He is without a doubt the most consummate and most professional of the politicians within the Victorian Labor Party and I think it would be appropriate he be given the opportunity to succeed Steve Bracks."

Bendigo was Mr Brumby's political training ground before he ventured into the state political arena.

He represented the seat of Bendigo as the Federal member from 1983 to 1990 when Bob Hawke was Prime Minister.

Incumbent federal member Steve Gibbons said in his inaugural speech to Parliament in 1998 that Mr Brumby will: "no doubt, be the next Premier of Victoria, and I can think of no-one better equipped, more hardworking or more dedicated to occupy that office".

He was wrong. Mr Bracks took that role and that honour, but Mr

Brumby will gain a third chance on Monday.

Mr Brumby also began his working life in Bendigo – as a teacher at the Eaglehawk Secondary College.

Helen Kennedy, wife of David Kennedy – another former federal member for Bendigo – yesterday remembered the young teacher as someone who had a lot of focus.

"I think he has done really well as treasurer," Mrs Kennedy said.

After his time as a teacher, he worked on both sides of business; first as a union official – during which time he wrote and published an almanac and tourist guide on Bendigo – then after a seven-year-stint in federal politics, as an adviser to the banking and finance industry.

He is known for his economic conservatism which, when Labor was elected in 1999, came as a relief to many after Mr Kennett's reign.

Political lecturer at Deakin University Geoff Robinson stated on ABC's online news that Mr Brumby would be expected to follow Mr Bracks' political style.

"In many aspects (Mr Bracks) has pioneered the contemporary model of Labor leadership," Mr Robinson said.