By Angela Dorizas

Morris Iemma has oficially resigned as NSW Premier after being ousted by party room colleagues.

Mr Iemma was forced to resign when his Right faction colleagues refused to back his major cabinet reshuffle,  which included the demotion of Health Minister Reba Meagher and Community Services Minister Kevin Greene.

Caucus is expected to appoint Left faction member Nathan Rees as Premier and Carmel Tebbutt as Deputy Premier.

The Premier’s resignation follows the sacking of Treasurer Michael Costa last night and the resignation of Deputy Premier John Watkins on Wednesday.

In a press conference earlier today, Mr Costa voiced his concerns over the state’s AAA credit rating, the $200 million drop in stamp duty revenues for the first two months of the financial year and the state’s $300 health budget blowout. He also claimed that Iemma’s $12 billion north-west Metro rail line was unaffordable.