Vic Labor claims victory in Lyndhurst

Martin Pakula is confident he can win the by-election in the Victorian state seat of Lyndhurst. Source: AAP

LABOR'S Martin Pakula has claimed victory in the Lyndhurst by-election in Victoria with around 40 per cent of the primary vote after half the total vote was counted.

Victorian Opposition Leader Daniel Andrews has however acknowledged his party has an image problem after Labor's primary vote took a dive.

The primary vote was significantly down on the 55 per cent result achieved at the 2010 state poll and there was no coalition candidate.

Mr Andrews said it was no secret the Labor brand was facing challenges.

The latest Newspoll published in The Australian this week put the federal coalition at a 10-point lead of 55 to 45 per cent over Labor after preferences.

When asked if federal Labor's woes had impacted on the result, Mr Andrews said: "There are challenges from a brand point of view and I think everybody knows that," he told AAP.

"I'm not someone who throughout my time as leader of the Labor Party in Victoria that has ever sought to blame others for the challenges that we face.

"But I think it would be naive not to note, as we all do - not just Labor people but Victorians more broadly - that, you know, things are challenging, things are difficult for Labor just now."

Mr Pakula will pick up his previous portfolios of shadow attorney-general, racing, gaming and scrutiny of government.

"By-elections are very difficult, they're very challenging," he said.

"History will tell you that in by-elections people take the opportunity to vote differently, they vote all over the card."

The result gives Labor 43 seats on the floor of parliament to the coalition's 44, including the speaker.

It means the government needs the support of independent MP Geoff Shaw to pass legislation opposed by Labor.

The former Liberal MP is under police investigation for misconduct in public office and has a verbal agreement with Premier Denis Napthine that he will support the government on matters of supply and confidence.

"What this victory for Labor now means is that the Napthine government is now officially a minority, one that is beholden to Geoff Shaw," Mr Andrews said.

"On every bill, on every measure in every way, Denis Napthine is tied to Geoff Shaw."

Dr Napthine said there had been a 15 per cent swing against Labor, even without a coalition candidate.

"This is a slap in the face for Daniel Andrews in Labor heartland," he said.

"This is a repudiation of Daniel Andrew's approach and the fact that he is working hand-in-hand with militant union leadership."

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