New UK Cabinet Unveiled

New UK Cabinet UnveiledNew UK Cabinet Unveiled

British Prime Minister David Cameron unveiled his new cabinet on Monday after an unexpected election victory that gave his Conservative party a narrow majority in parliament for the first time in nearly 20 years.

Cameron named the mayor of London and potential leadership contender, Boris Johnson, to a senior political role but not a ministerial position. “As promised, he will devote his attention to his final year as mayor of London,” Cameron said, AFP reported. Many ministers from the previous government held on to their jobs including finance minister George Osborne, another potential leader who was promoted to a post as Cameron’s number two in government.

Theresa May has been reappointed as home secretary and several women were promoted to more junior positions, after Cameron promised that a third of his cabinet would be made up of women. Cameron also held talks with Conservative backbenchers amid concern that right-wingers in his party could play a disruptive role for the government, particularly over Britain’s EU membership.

The Conservatives won 331 out of the 650 seats in the House of Commons in Thursday’s election, which gave Labour 232, the pro-independence Scottish National Party 56 and the Liberal Democrats just eight.

With the exception of nationalists in Scotland, the election left Britain’s opposition in disarray, following Friday’s resignations of Labour leader Ed Miliband and Liberal Democrat chief Nick Clegg. MPs will be formally sworn in next Monday and Queen Elizabeth II will deliver her traditional speech at the State Opening of parliament on May 27, which will outline the Conservatives’ legislative proposals.

Cameron has promised to hold an EU membership referendum by the end of 2017 and to eliminate Britain’s budget deficit of some $139 billion (£90b) by 2018-2019.

In related news, the British central bank said on Monday that it would maintain its benchmark interest rate at 0.5 percent, the level since March 2009, as the markets digest the implications of the Conservative Party’s election victory last week.

The Conservatives made fiscal tightening a key tenet of their campaign, and many economists predicted that the party’s victory meant the Bank of England would further delay any rate increase. As the government cuts spending, the idea is that the Bank of England mitigates the impact of those cuts with low interest rates to encourage borrowing and other economic activity.

The JPMorgan economist Allan Monks trimmed his forecast for Britain’s 2016 growth rate to 2.3 percent, from 2.6 percent, based on the impact of expected budget cuts.