Set Appliance State:

Isolate Mains Power to appliance as per TOPs P4
Remove the diverter valve actuator
(To remove the actuator remove the clip and pull upwards)

Observation:

Press the spindle of the diverter valve in with a screwdriver.
It should move in freely by approximately 10mm until it is flush with the brass.
Release the spindle and it should spring back freely by approximately 10mm.
Does the diverter valve spindle behave as described above?