Robert Jenrick and Kemi Badenoch are through to the final round of the Conservative leadership race after knocking out James Cleverly.

The shock result, announced in Parliament, was met with gasps from some who had expected Cleverly to get through to the last two, after he had delivered a well-received speech at the party’s conference last week and topped the ballot of MPs in the third round on Tuesday.

However, in the fourth round he received 37 votes from his colleagues, falling behind Badenoch on 42 and Jenrick on 41.

The final two candidates will now be put to Conservative Party members with the result due on 2 November.

In a message posted on social media, Cleverly thanked his supporters for their backing adding: “Sadly it wasn’t to be.

“We are all Conservatives, and it’s important the Conservative Party unites to take on this catastrophic Labour government.”

Following the result, both Badenoch and Jenrick praised Cleverly and hinted that they could give him positions in their shadow cabinet if they should win the overall race.

Badenoch said Cleverly’s campaign had been “full of energy, ideas and optimism” and she looked forward to “continuing to work with him”.

Jenrick praised a “brilliantly” fought campaign adding: “The Conservative Party needs you in its top team in the years ahead.”

Speaking to the BBC, Jenrick said he was “so pleased” to be in the final two and promised to offer “professional, competent leadership” aimed at “regaining the trust of the British public”.

He said his party needed to focus on the economy, the NHS and immigration rather than “going down rabbit holes”.

Badenoch said she was “delighted” to have topped the MPs’ poll and that it was “time to go bold”.

She said Conservatives needed to “talk about everything, we need to talk about the system, which I think is broken”.

“I think Labour are having problems because they are working with a broken system.”

Jenrick has made leaving the European Convention on Human Rights a key part of his campaign, but Badenoch said focusing too heavily on that topic would “shut down conversation we need to have with the entire country”.

Badenoch, a former business secretary, and Jenrick, a former Home Office minister, had been seen as appealing to the right of the party with Cleverly representing those nearer to the centre-ground.

Badenoch is seen as articulating uncomfortable truths by her supporters; while Jenrick is praised by his backers for his stance on immigration, and his resignation from his ministerial job.

Speaking to the BBC following the result announcement, one senior MP said: “It’s not a result I expected.

“There may have been a degree of complacency in one camp. I did warn colleagues that if they try to game the system they need to be careful about possible problems.

“It seems Tom Tugendhat’s votes went to Robert and Kemi. It’s quite a surprising position.”

Another said: “It was a genuine shock… the number of pledges made by MPs will have greatly exceeded 120, but that is perfectly understandable because our natural instinct is not to upset people.”

The eventual winner of the contest will replace Rishi Sunak as leader of the Conservative Party.

Sunak announced his resignation after the party’s general election defeat earlier this year.

Since September, Conservative MPs have been whittling down the candidate list in a series of votes.

Former home secretary Priti Patel was the first to be knocked out, followed by shadow pensions secretary Mel Stride and then shadow security minister Tugendhat.