Saturday, May 7 2005 10:19 Hrs (IST) - World Time -

London: A day after he was voted to power for a historic third term with a drastically reduced majority, a chastened British Prime Minister Tony Blair carried out a Cabinet reshuffle reappointing most of his old-guards in their key posts, including his heir-apparent Gordon Brown as Finance Minister.

David Blunkett, forced to quit in December 2004 as Home Secretary after it emerged that a visa application for his ex-lover's nanny was fast tracked, returns as the new work and Pensions Secretary.

Jack Straw will remain the Foreign Secretary.

Brown, a more popular figure than Blair thanks to his stewardship of the Britain's strong economy, had been expected to stay on as chancellor of the exchequer.

Brown is virtually certain to become the Premier if Blair steps down.

Blair reappointed deputy Prime Minister John Prescott as first Secretary of State, Charles Clarke as the Home Secretary and Ruth Kelly as secretary, department of education.

John Reid former Health secretary will be the new Defence secretary and former Defence secretary Geoff Hoon will be the Leader of the Commons. Former Trade secretary Patricia Hewitt will be the new Health secretary.

Peter Hain becomes Northern Ireland secretary at a troublesome point in the peace process, as the Ulster Unionist party leader David Trimble last night (May 6, 2005) lost his seat at Westminster in a rout of the UUP.

The reshuffle sees Alan Johnson take the new post of secretary for productivity, energy and industry, meaning the Department of Trade and Industry will be renamed.

Blair has also brought three new faces into his Cabinet, with David Miliband, Des Browne and John Hutton joining the top table.

The former immigration Minister Des Browne joins the Cabinet as chief secretary to the Treasury, a position vacated by Paul Boeteng who opted to be the new High Commissioner to South Africa. The former Health Minister John Hutton takes on Alan Milburn's old Cabinet job as Minister for the Cabinet office, while Milburn's former deputy David Miliband takes up the new post of Minister of communities and local Government.

Alan Milburn, who was criticized for his handling of the election campaign, last night told Blair he did not want to stay in the Cabinet.

The remaining sub-Cabinet level Ministerial posts will be announced on Monday (May 9, 2005), Downing Street said.

After winning an historic third Labour term yesterday morning, and being invited by Queen Elizabeth II to form the next Government, Blair struck a modest note as he reassumed the reins of power in Downing Street.

With results of 644 of the 645 seats declared till last night, Labour has secured 355, Conservative 197 and Liberal Democrats 62. Labour's 161-member majority in the dissolved Parliament has dwindled to 66.

In the elections the Ministerial casualties included the schools Minister, Stephen Twigg, who lost the Enfield Southgate seat he won in 1997. The Health Minister, Melanie Johnson and the constitutional affairs Minister, Chris Leslie, also fell.

Despite the Tory gains, Michael Howard announced yesterday that he would stand down as Conservative leader once the party had had an opportunity to review and change its election rules.