David Cameron hails 'seismic shift' in politics

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David Cameron hailed "a historic and seismic shift" in Britain's political landscape today as he launched the country's first coalition government since the Second World War.

The new Prime Minister marked his inaugural day in office by handing two major economic portfolios to his Liberal Democrat allies, anointing Vince Cable as Business Secretary and David Laws as Chief Secretary to the Treasury.



He also promised "very early legislation" to establish fixed-term Parliaments, effectively enshrining in law the Conservatives' five-year coalition deal with the Lib Dems.



At a joint news conference with new Deputy Prime Minister Nick Clegg - held in the garden of No 10 - Mr Cameron said the award of a total of five Cabinet jobs to Lib Dems underlined the parties' "sincere determination" to work together.



"It will be an administration united behind one key purpose: to give our country the strong, stable and decisive leadership we need," he said.



"We have a shared agenda and a shared resolve, to tackle the challenges that Britain faces."



The appointment of Mr Laws, a former banker, as new Chancellor George Osborne's deputy at the Treasury appeared particularly significant.



As Chief Secretary he will be responsible for deciding where the axe will fall when it comes to spending cuts, ensuring the Lib Dems will be thoroughly implicated in the unpopular decisions that will undoubtedly have to come.



Mr Clegg acknowledged that there would be "bumps and scrapes" as they were two different parties with many different ideas, but insisted nevertheless that it was a coalition which would last.



"Until today, we have been rivals, now we are colleagues. That says a lot about the scale of the new politics which is now beginning to unfold," he said.



"This is a Government that will last because despite those differences, we are united by a common purpose for the job we want to do in the next five years."



Mr Cameron described their alliance as a "new progressive partnership". He said Mr Clegg would have responsibility for the Government's political reform agenda as well as standing in at Prime Minister's Questions when he was away.



In other notable Cabinet appointments, Theresa May was promoted to become Britain's second woman Home Secretary while Kenneth Clarke was made Justice Secretary and Lord Chancellor.



There was a gesture to the Tory right with a return to the frontbench for former leader Iain Duncan Smith as Work and Pensions Secretary.



Michael Gove as Education Secretary, Andrew Lansley as Health Secretary, Liam Fox as Defence Secretary, and Jeremy Hunt as Culture Secretary were all confirmed in the portfolios they held in opposition.



It followed the confirmation overnight that William Hague was the new Foreign Secretary while Mr Osborne was Chancellor.



Mr Cameron and Mr Clegg were in buoyant mood at their news conference, joshing about Mr Cameron's famous dismissal of his new partner as a "joke".



However they also sought to underline their determination to get down to the serious business, announcing that they would be attending the first session of the new National Security Council.



They also published the document detailing the terms of their coalition agreement, including how they will set about tackling Britain's record £163 billion deficit and those areas - such a nuclear power - where they agree to differ.

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