A. George Osborne, David Cameron’s sidekick as shadow chancellor during the Tories’ past few years in opposition, becomes chancellor of the Exchequer, the second biggest role in government. His deputy will be Liberal Democrat negotiator David Laws, the party’s former schools spokesman and the MP for Yeovil, who has been appointed as chief secretary to the Treasury.
Q. WHO HAS LOST OUT IN THE APPOINTMENT STAKES?
A. The politician to shoulder the biggest disappointment is Ken Clarke, the former shadow business secretary. Instead of taking up that brief, Clarke has been shunted over to justice secretary, heading a relatively small department. Ex-Lib Dem Treasury spokesman Vince Cable has been appointed in his place as business secretary, the role previously held by Lord Mandelson under Labour. Traditionally the business secretary holds responsibility for trade and industry, though Cable’s brief will include chairing the coalition government’s new commission to review splitting banks’ retail and investment banking operations.
Q. WHAT WILL BE THE TREASURY’S FIRST PRIORITY?
A. Osborne has an mountainous struggle ahead – topped by tackling the UK’s yawning fiscal deficit. With that in mind, the new chancellor will have to start work immediately on pulling together an emergency Budget, which will be held within the first 50 days.
Q. HOW WILL THE NEW CABINET GET TO GRIPS WITH BANKING REFORM?
A. Pre-election, Cable established himself as one of the City’s harshest critics, advocating a crackdown on bonuses and the splitting up of retail and investment banking operations. The latter, at least, will be put on the back burner for the time being, while it is subject to a commission review over the next year. Osborne’s radical proposal to wind down the FSA and hand its powers over to the Bank of England has also been shelved.