Few would deny that the election of David Cameron as Conservative Party leader has changed the political landscape in Britain. And one group now under pressure is the Liberal Democrat party.

Mr Cameron has lost little time invading Liberal Democrat territory. It was telling that he raised an environmental issue at Prime Minister's Questions on Wednesday. And his desire to ditch what he calls the "Punch and Judy" approach to politics is a challenge to the Liberal Democrats. If Mr Cameron follows through on his pledge to adopt a more reasonable tone than his predecessors, Charles Kennedy will find competition for the mantle of most "likeable" political leader in the public mind.

Of course, his party still has an advantage over the Tories on questions of human rights. And, importantly, they have "purity" on the subject of Iraq, thanks to their principled opposition to the invasion from the start. It is worth remembering - and no doubt many Liberal Democrat spokesmen will point it out in the coming months - that Mr Cameron and those close to him in Parliament voted in favour of the invasion. Additionally, the Liberal Democrats can boast a more mature approach to Europe than their opposition rivals.

Yesterday, Mr Cameron unveiled his new frontbench team. In truth, it was a disappointing reshuffle, with right-wingers awarded top posts, uninspiring characters such as Andrew Lansley and Theresa May retaining vital jobs, John Redwood left with a platform and too few of the young modernisers promoted. This will leave a heavy responsibility on the new Tory leader's shoulders.

There is, however, considerable talent on the Liberal Democrat front bench, as we have seen in recent weeks. Vincent Cable provided a strong critique to the Chancellor's pre-Budget report earlier this week. Sir Menzies Campbell is now the most authoritative opposition voice on Iraq in the House of Commons. And the likes of David Laws and Norman Baker have demonstrated great skill in handling their respective briefs of pensions and the environment.

Clearly, there is no need to panic. But the party must turn with renewed vigour to its internal policy reviews in order to stake out a position in the changing political landscape.

Ultimately, however, the biggest challenge is faced by the party leader. Mr Kennedy has been the most effective opposition leader over the past two years. But does he have the vision, appetite and adaptability to take his party forward in this new political era?