Ken reclaims the capital

Triumphant Livingstone becomes Mayor and pledges unity - then immediately issues threats to Blair

"As I was saying before I was so rudely interrupted 14 years ago..." With inimitable flair and a gift for the one-liner, Ken Livingstone staged a spectacular return to frontline politics yesterday, sweeping to power as the first directly elected Mayor of London.

Having won the personal backing of some 776,000 voters, the independent candidate's triumph completed a day of misery for Tony Blair as the Tories won swaths of Labour council seats across the country. From inner-city council estates to leafy suburbs, the capital plumped for Mr Livingstone by a huge margin to restore him as the head of London's government.

The former Labour MP won 58 per cent of the vote, ahead of the Tory candidate, Steven Norris, on 42 per cent after second preferences were transferred. Labour's Frank Dobson came a poor third on just 12 per cent of first preference votes, narrowly ahead of Susan Kramer, the Liberal Democrat contender.

Mr Livingstone was declared the winner shortly after midday and gave an emotional victory speech before immersing himself in the business of running Britain's newest authority. He immediately offered an olive branch to the Government, pledging to work with ministers, the Labour Party and his colleagues on the Greater London Assembly in the interests of all.

"I am personally overwhelmed that London has given me a mandate against the three most powerful party machines in Britain. However, the job of Mayor is to unite all of the capital," he said.

At a packed news conference at his new mayoral offices in Westminster, Mr Livingstone later stressed that he wanted to repair his relations with Labour: "My intention is to heal this wound, not deepen it," he said.

Mr Blair, in Northern Ireland for peace talks, said both he and the Labour rebel now had a responsibility to co-operate. "The people of London have made their verdict and it's my responsibility to ensure that this now works for London," Mr Blair said.

But the former GLC leader warned that he would not back down on his opposition to government plans to part-privatise the Tube and threatened to seek a judicial review unless Londoners were given value for money from the scheme.

Mr Livingstone appointed himself head of the new Transport for London body and will spend the weekend offering jobs to oversee the police, fire brigade and economic development agency.

The GLA election offered more bad news for Millbank, the Labour Party headquarters, with the Tories winning nine seats, joint equal with Labour. The Liberal Democrats, with four members, and the Greens, with three, hold the balance of power.

Mr Livingstone said Labour's heavy losses in the local authority elections in England were "a wake-up call" to the party. He said: "The Tories have done very well and we can't take the next election for granted. It is no good giving promises of what might come in a few years - people want to see it happen before they go to the polls again."

Labour lost 568 seats overall, the Tories gained 593 and the Liberal Democrats lost 20. The Tories gained power in 16 authorities while Labour lost control of 15, including Basildon in Essex and the northern strongholds of Bradford, Burnley, Oldham and Hartlepool.

Tony Blair struck a contrite tone and conceded that Labour had suffered some bad results. He said: "I am the very first to admit that, although we have achieved a lot, there is still an awful lot more to do. I know that is what many people in the country accept as well. I want them to know that we understand and respond to that."

William Hague, the Tory leader, said he was "delighted" by the party's "sensational" results, and claimed Labour had been "hammered" across the country. But Mr Hague's celebrations were marred by his party's humiliating and surprising defeat in the parliamentary by-election inRomsey.

The Liberal Democrats overturned an 8,500 majority to win by 3,300 votes in one of the Tories' safest seats.

Conservative MPs said Mr Hague's appeal to Tory supporters on issues such as asylum-seekers had failed disastrously in Romsey, where the turn-out was twice that of the town hall polls. They urged Mr Hague to adopt the more inclusive approach of Mr Norris, the party's candidate for Mayor of London.

Ian Taylor, Tory MP for Esher, said: "Steve Norris reached out to people who are not our core voters, which is the only way we will ever win a general election."

Charles Kennedy, the Liberal Democrat leader, said the Tories' performance "blows apart their entire election strategy" and was a "fantastic launch pad" for his party.