Osborne gets Chancellor while Cable controls business and banks

Both former shadow chancellors George Osborne and Vince Cable have been given positions in the new coalition cabinet.

Conservative party leader David Cameron has become Prime Minister with Nick Clegg as his deputy in a Tory-Lib Dem coalition which brings an end to five days of uncertainty over Britain's future Government.

After hours of frantic Tory party negotiations with the Liberal Democrats, at around 9pm last night the 43 year-old Cameron entered 10 Downing Street as its youngest occupant in nearly two centuries, nine years after first entering Parliament.

He confirmed Conservative George Osborne will replace Alistair Darling as Chancellor of the Exchequer one door down at Number 11.

Vince Cable, Lib Dem Treasury spokesman and one of their highest profile MPs, has been given responsibility for "business and banks" but it is not known if his title will be chief secretary to the Treasury, a senior Lib Dem source said.

One of Osborne's first jobs as Chancellor will be to put together an emergency Budget, which the Lib Dems have agreed to hold within the first 50 days of the new Government.

Clegg's party will gain four other cabinet ministers besides deputy leader, and are expected to get about 20 government jobs in total in what Cameron has called a "proper and full coalition" between the two parties.

The first full meeting of the coalition cabinet is expected to take place today, marking the end of 13 years of Labour Government.

Harriet Harman becomes acting leader of the Labour Party with immediate effect following Gordon Brown's resignation at around 7pm last night.

He told reporters: "I wish the next Prime Minister well as he makes the important choices for the future.

"Only those who have held the office of Prime Minister can understand the full weight of its responsibilities and its great capacity for good. I have been privileged to learn much about the very best in human nature and a fair amount too about its frailties - including my own."

On entering Downing Street, Cameron praised Brown for his "dedication to public service", but said the UK's best days lie ahead.

He added he wants to rebuild trust in politics, and promises to be "honest about what government can achieve" and to build a more "responsible society".

However, Brown has said he will not leave politics altogether, and has pledged to continue in his role as MP for Kirkcaldy and Cowdenbeath.

Talks between Lib Dem and Labour about forming their own "Rainbow Coalition" broke down yesterday afternoon, despite Brown's pledge to step down as party leader at the Labour conference in September.

In last Thursday's General Election, the Conservatives won the most seats with 306, but failed to secure the 326 places needed to form an outright majority Government.

Labour won 258, and the Lib Dems 57. The result was a hung Parliament, and both Labour and the Tories have been courting the Lib Dems for days in order to gain their support and take power.