Two years after losing the Knesset election, Isaac Herzog lost the Labour leadership on Tuesday as he failed to go through to the second round of the party’s leadership contest.

The two remaining candidates are former party leader and defence minister Amir Peretz and former environment minister Avi Gabbay, who joined Labour only a few months ago.

The choice facing Labour members is now between the left-wing option, Mr Peretz, a former trade union leader and a staunch supporter of founding a Palestinian state, and the centrist Mr Gabbay, who admitted in one of the campaign debates that he once voted Likud.

Mr Peretz won with 32 per cent of the vote but was short of the 40 per cent threshold to be elected leader in the first round. Despite coming first, he is not necessarily the favourite to win in the next round as many of those who voted for other candidates are expected to coalesce around Mr Gabbay.

Mr Peretz has angered many Labour members in the past by leaving the party twice for competing lists. Mr Gabbay, by contrast, is a newcomer to the party, but is viewed by many as an attractive and fresh candidate without baggage.

Winning 27 per cent and coming second is regarded a huge achievement for Mr Gabbay. Until just three years ago, he was the CEO of Bezek, Israel’s largest telecommunications company. In 2015, he joined the new Kulanu party, working with its founder, Moshe Kahlon. He was appointed environment minister in the new government but chose to resign when Yisrael Beiteinu joined the coalition, and only this year joined Labour. Despite being a newcomer to the party, he now has momentum going in to the second round, while Mr Peretz, who has a strong base of supporters, but not a majority, may have peaked.

The result was particularly dire for Mr Herzog. He received only 17 per cent of the vote and only narrowly avoiding being pushed in to fourth place by Erel Margalit.

In a Facebook message, Mr Herzog thanked his supporters and said he would be consulting with them in the coming days over who to support in the second round, which will take place on Monday.

Mr Herzog paid the price not only for the defeat at the elections, but also the failed attempts to join Mr Netanyahu’s coalition, as well as the feeling that under him, Labour has been a weak opposition.

In recent polls, the Zionist Union, of which Labour is the main component, is predicted to lose as many as half its current seats in the Knesset. His departure could also mean the end of Zionist Union, the bloc he formed before the last election together with Tzipi Livni’s Ha’Tnuah party.

Israeli politics: the basics

Likud is the party of Israel’s current Prime Minister, Benjamin Netanyahu. It is ideologically a right-wing, conservative party with strong nationalist side. In 2009, Mr Netanyahu declared his support for a two-state solution but only under the conditions of Palestinian demilitarisation and recognition of the Jewish state. Likud has been one of the two main parties in Israeli politics since 1977 and been the party of the prime minister since 2009, despite not always winning the most seats in the elections.

Labour was established in 1968 and was the dominant political party in Israeli politics for almost a decade. In 1977 it became the opposition for the first time. It is a centre-left party with social-democratic views supporting a strong defence force.

Founded in 2012 by Yair Lapid, Yesh Atid seeks to represent the Israeli secular middle-class. It joined Mr Netanyahu’s government after the 2013 election but in 2015 it moved to the opposition. The party focuses on government reform and ending military draft exemptions for the strictly Orthodox in order to relieve the burden on the secular middle class.

Kulanu was founded in 2014 as a centrist party. Its leader, former Likudnik Moshe Kahlon, is known for his success in forcing Israel’s phone cartels to lower their prices when he was Minister of Communications. The party’s main focus is domestic economic issues but supports halting growth outside the major settlement blocs in order to enhance chances of a two-state solution. The party is socially liberal and supports issues such as civil marriage, funding partial public transport on Saturdays and decriminalising marijuana.

Shas is a strictly-Orthodox religious party, founded in 1884. It was under the spiritual guidance of the former Sephardi Chief Rabbi of Israel, Rav Ovadia Yosef, until his death in 2013. The party advocates that the state be run according to halachah, ie Jewish law. The party moved to the right on the issue of settlements and is socially conservative, standing against public expressions of homosexuality. It holds considerable sway and was part of the 2006 and 2009 coalition governments.

The Jewish Home party was formed in 2008 and is headed by Naftali Bennett. The party represents many modern-Orthodox Jews in Israeli society. It has a pro-settlement message and is against any military draft exemption for the strictly-Orthodox. It is also socially conservative, however, with many of the party’s members opposed to gay marriage.

Yisrael Beiteinu is a party with strong nationalistic views and notionally represents the large immigrant Russian population in Israel. The party has been in coalition with Mr Netanyahu’s Likud party since the 2013 election.

Meretz is a left-wing social-democratic party founded in 1992. The party holds secular views, emphasises support for a two-state solution and is in favour of stopping Israeli development in the West Bank. The party also holds liberal views on gay rights and religious freedom. It believes in the separation between state and religion and emphasises environmentalism.

Hatnuah is a breakaway from the Kadima party, founded in 2012. It has progressive views and emphasises the need for a pragmatic peace settlement with the Palestinians. The party’s platform revolves around foreign policy, and has a three-step plan to ensure US and EU support before direct negotiations with the Palestinians. It has socially progressive views on issues such as conversion reform and gay rights. It is one of the main parties in Netanyahu’s coalition government.

Kadima was formed in 2005 when Ariel Sharon broke away from the right-wing Likud to form a new centrist party. The shift came after Israel withdrew from the Gaza Strip under Mr Sharon’s leadership, losing him the support from many of his former party’s members.  It won the most seats in the 2006 election and formed a coalition government under Ehud Olmert.  Despite winning the most seats in the 2009 election, it failed to create a governing coalition and its size and influence has been diminishing ever since.