Brash quits as New Zealand opposition leader

WELLINGTON, Nov 23 (Reuters) The leader of New Zealand's main opposition National Party, Don Brash, stepped down as leader today, saying speculation about his leadership was hurting the party.

Brash, 66, a former central banker, had been party leader for three years and came close to leading centre-right National to an election win last year.

Brash said he had been looking for the right time to quit as leader.

''But it has become increasingly clear in recent months that there's a growing expectation that I'll step down well ahead of the next election,'' Brash said in speech notes.

''That ongoing speculation is damaging to the National Party, and to our future prospects.'' Brash quit as governor of the Reserve Bank of New Zealand in April 2002 to pursue a political career, and became leader in a party coup in October 2003 that replaced then-leader Bill English.

The National Party has built a solid lead over the governing centre-left Labour Party in opinion polls this year on the back of controversies about spending in last year's election and a series of scandals involving cabinet ministers.

However, Brash's relative political inexperience has raised questions about his performance and judgment, and led to speculation about his leadership.

In September he took leave to sort out marital problems amid questions about his relationship with a businesswoman, and this week he obtained an injunction to prevent the publication of what he said are potentially damaging stolen emails from his computer.

Labour had painted him as untrustworthy and prone to backtracking under pressure. He has consistently trailed Labour leader Helen Clark in polls on preferences for prime minister.

The next general election is not due before mid-2008.

Brash said his successor would be selected at a special party meeting next Monday.

Among those tipped as potential contenders for the National Party leadership are the deputy party leader Gerry Brownlee, former leader Bill English and the finance spokesman John Key, who has only been in parliament for four years.

Deputy Prime Minister and Finance Minister Michael Cullen said National was now looking for its fifth leader in nine years.

''This continued instability in the National Party is a sign of a party still nowhere near ready to govern,'' Cullen said in a statement.

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