Jeremy Corbyn acts as peacemaker between rival Labour factions after Neale Coleman quits

For Jeremy Corbyn, it is one step forward, one step back. Just when the Labour leader thought he had got his act together and could turn his guns on to the Government, he needs to act as peacemaker between two rival factions inside his own inner circle.

Team Corbyn was delighted with his first party political broadcast this week, in which he spoke of his “journey” and invited the public to join him on it to “build a better Britain.” Allies hoped it would mark a turning point on the road to forming a credible Opposition.

But it has now been overshadowed by the resignation of a key adviser, which has been blamed on the power struggle inside the Corbyn camp. Labour has been seen as in a state of “civil war” since Mr Corbyn won the party leadership last September with the backing of only 20 of its 232 MPs but overwhelming support from Labour’s grassroots members. Yesterday the feuding took on a new dimension when simmering tensions inside Team Corbyn became public.

Neale Coleman, one of the Labour leader’s most respected aides, quit as his head of policy and rebuttal after just four months, complaining he was kept in the dark over a key announcement last weekend. Mr Corbyn said companies should be banned from paying dividends to shareholders unless they paid their workers the Living Wage.

Mr Coleman, who may take on a less demanding advisory role, said: “With the 24/7 news cycle, the demands and pressures of this particular job are very great and greater than I had foreseen. I have reluctantly decided that with my young family it is best to stand down now so someone else can have a proper run at it. I continue to be a strong supporter of Jeremy Corbyn’s leadership and want to contribute to his and the Labour Party’s success in the future.”

It is no coincidence that Mr Coleman was a key aide to Ken Livingstone when he was Mayor of London. He was the most senior figure kept on by Boris Johnson when the Conservatives defeated Mr Livingstone in 2008, playing a key role in preparations for the 2012 London Olympics.

Labour insiders claim a pro-Livingstone group is battling for power with a camp led by John McDonnell, the shadow Chancellor and Mr Corbyn’s closest political ally.

The Livingstone faction, dubbed “the Kennites”, includes Simon Fletcher, a former Ed Miliband aide who ran Mr Corbyn’s leadership campaign and is now his chief of staff, the job he did for Mr Livingstone at City Hall. The “Kennites” are said to be less ideological and more pragmatic than the McDonnell group. They favour a conciliatory approach towards the Shadow Cabinet members and backbench MPs who have differences with Mr Corbyn.

The more hardline McDonnell camp includes Seumas Milne, a columnist on leave from The Guardian newspaper, who Mr Corbyn persuaded to become his director of communications after a shambolic start to his leadership. He is credited with injecting more discipline into the operation. But critics claim he is a divisive “control freak” who wants to be in charge of policy as well as communications and to supplant Mr Fletcher.

Mr Milne takes a less tolerant view of dissenting MPs than the “Kennites” and is said to have pressed Mr Corbyn to sack more Shadow Cabinet critics in this month’s messy reshuffle than he eventually did. Shadow ministers angrily accused him of briefing journalists during a Shadow Cabinet meeting that Labour MPs would be whipped to vote against UK air strikes against Isis in Syria last December. When they saw the briefing on their smartphones, a rebellion forced Mr Corbyn to concede a free vote.

Team Corbyn have insisted there was “no row” between Mr Milne and Mr Coleman and dismissed as “complete rubbish” speculation that Mr Fletcher could walk out because of a rift with Mr Milne. One insider said: “Seumas is the conduit and gets all the flak. It’s not a clash, more growing into office pains. Everyone is learning as they go along, from Jeremy downwards. The stakes are high and everything gets magnified.”

Another member of the McDonnell clan is Andrew Fisher, Mr Corbyn’s policy director. He allegedly shouted at Mr Coleman during a row over the reshuffle: “You are finished in here.”

Mr Fisher dismissed this claim as a lie.

Mr Fisher attracted controversy over Twitter messages urging people to vote for a Class War candidate at last year’s general election and celebrating the defeat of mainstream Labour MPs including Ed Balls. Mr Fisher was suspended by Labour but later readmitted.

Some Labour Kreminologists claim the current dispute can be traced back to a bitter split on the hard left in the 1980s when Mr Livingstone fell out with Mr McDonnell, his deputy as leader of the Greater London Council (GLC). Mr McDonnell accused Mr Livingstone of selling out after he refused to defy the Thatcher Government by not balancing the GLC’s books. Mr McDonnell chairs the Labour Representation Committee (LRC), which he founded in 2004 to reach out to left-wingers outside Labour. LRC figures attacked Mr Livingstone’s Socialist Action group as “plastic socialists”. The rival factions have even been compared to Russia’s hardline Bolsheviks and more moderate Mensheviks, who split in 1903.

One former senior Labour official said: “The Corbynistas are fighting amongst themselves. They are more interested in winning power in the party than the country. As a result, we have a feeble Opposition and the Tories are getting away with murder.”