May stamps her mark on new cabinet

Senior ministers under Cameron are sent packing as new PM shapes her team

British Prime Minister Theresa May completed a major overhaul of the government yesterday, promoting leading Brexit campaigners and stunning observers by picking gaffeprone Boris Johnson as her top diplomat.

After six years as interior minister under David Cameron, May took office on Wednesday signalling her intention to start with a clean slate — before ruthlessly ejecting some of her former colleagues.

Finance minister George Osborne was replaced by foreign minister Philip Hammond, while two Euro-sceptics were brought in to take control of Britain’s exit from the European Union.

EU leaders have lined up to congratulate May, whose appointment brings some stability three tumultuous weeks after the June 23 referendum, but urged her to move quickly in implementing the vote to leave.

The result has sparked turmoil on financial markets and sent shock waves throughout British and European politics, including forcing Cameron to step down.

At its first meeting since the referendum, the Bank of England’s monetary policy committee decided to keep interest rates unchanged at 0.50 per cent, although it signalled a possible cut in August.

The British pound briefly jumped above $1.34 (Dh4.92), while London’s FTSE 100 index slid, reflecting some disappointment at the bank’s decision to

hold off on an anticipated rate cut.

In a bid to reassure markets, May appointed a safe pair of hands as finance minister. Hammond was due to meet Bank of England governor Mark Carney yesterday, as well as visiting US Treasury Secretary Jacob Lew.

Responsibility

David Davis has been put in charge of exit negotiations as new Brexit minister, while Liam Fox has responsibility for negotiating new trade agreements outside the bloc.

EU leaders, still reeling from Britain’s decision to become the first country to leave the bloc in its 60-year history, pressed May for a quick divorce.

May’s first calls after taking over late Wednesday were to Europe’s

top two power brokers, German Chancellor Angela Merkel and French President Francois Hollande.

Hollande “reiterated his wish for the negotiations on Britain’s departure from the European Union to be undertaken as soon as possible”, his office said.

European Commission President Jean-Claude Juncker said the vote “has created a new situation which the United Kingdom and the European Union will have to address soon”.

May’s spokesman said she had emphasised in her calls, which also included Irish premier Enda Kenny, that she would implement the referendum decision.

But she “explained that we would need some time to prepare for these negotiations”.

May had presented herself

as the most stable and unifying candidate to succeed Cameron, but she marked a break with his leadership by removing some of his key ministers.

Justice secretary Michael Gove, a leading Brexit supporter and her rival in the Tory leadership race, was sent packing along with Osborne, and the education and culture ministers.

However she kept defence minister Michael Fallon and health minister Jeremy Hunt in their posts. Osborne had threatened an emergency budget in the event of Brexit, but Hammond ruled it out yesterday, although he said businesses needed to know what the future held.

“There has been a chilling effect” on markets since the referendum, he told BBC radio.