"I think it's necessary. It gives Lianne a bit of clear air to talk about things to do with the mayoralty."
Although she would have an advisory role on earthquake issues behind the scenes, Mr Cosgrove would be tasked to make sure EQC was working well.
"He's good at banging heads," Mr Shearer said.
He said Ms Dalziel had done "sterling work" as earthquake Recovery and EQC spokeswoman.
"She has stood up for the people of Christchurch and driven Labour's grassroots approach to tackling the rebuild.
"But given her bid for the Christchurch mayoralty, Lianne agrees that the time is right for others to step into those roles," Mr Shearer said.
He said he expected a by-election in Christchurch East would be "later in the year rather than earlier" and believed it would be wise to stay clear of the local body elections in October.
"After, rather than before would be ideal."
Mr Shearer said Labour would be pushing to regain Christchurch Central and Waimakariri electorates at next year's general election.
"There is a sense I pick up in Christchurch that people are just tired of the Government and that a lot of things haven't moved as fast as people would have liked."
He believed the type of "community approach" Labour would bring to the city's recovery would "resonate".