City leader joins Livingstone's cabinet

London Mayor Ken Livingstone is appointing his cabinet

City leader Judith Mayhew has joined London Mayor Ken Livingstone's cabinet as his business adviser.

She will do the job at the same time as keeping her current position as head of policy - effectively its boss - of the Corporation of London.

Announcing the appointment on Thursday, Mr Livingstone said he was "delighted".

"Judith Mayhew is well known to the business community and I am confident that here experience and expertise will be a huge asset to the work of the Greater London Authority."

Ms Mayhew said she would serve as a bridge for information to flow between Mr Livingstone and the business community.

The 51-year-old New Zealander said: "London business as a whole is a vital part of our national economy and I am looking forward to working with the mayor and his office in this exciting role."

Tory mayoral rival

Judith Mayhew: Tried to become a Tory MP

Her new role as Mr Livingstone's City ambassador allows Ms Mayhew to combine her political ambitions with her financial experience. Her self-confessed liking for being in the public eye may also prove useful.

At one stage last year she was touted as a rival to Mr Livingstone for the job of London mayor - as the Conservative candidate. She met Tory leader William Hague to discuss the possibility.

Tory party managers were worried that the baggage of the two main Conservative contenders, Lord Archer and Steven Norris, could come back to haunt them.

That fear turned out to be more than justified when Lord Archer was later forced to resign in disgrace as the mayoral candidate after he admitted asking a witness to lie for him in libel trial.

Ms Mayhew came within a hair's-breadth of becoming a Tory MP in 1997 when she just missed winning the selection contest for Hampshire North West, one of the party's safest seats in the country.

She went for it because "it's always been a dream to be a national politician".

But she has insisted she is no die-hard Tory; she cites fellow Kiwi and former senior Labour frontbencher Bryan Gould as one of her friends back home.

And the London mayor expressed his own high opinion of Ms Mayhew last autumn, when Labour's tortuous selection process was still dragging on, saying he might ask her to be in his mayoral cabinet.

"I get on very well with Judith," he said. "She has transformed the City".

Like her new boss, she is in favour of joining the European single currency - likely to have been a key consideration in the mayor having chosen her for the post.

Ms Mayhew complained to the police last year about alleged harassment from Euro-sceptics opposed to her public stance on the issue.

During the London election campaign Mr Livingstone made clear his intention to do all he could to get the government to join the euro.

Earlier this year Ms Mayhew came in 31st in Management Today magazine's annual ranking of Britain's most powerful women.