Theresa May has made ally Philip Hammond Chancellor of the Exchequer as George Osborne quit the government.

In her first appointment as Prime Minister, the former Foreign Secretary was promoted to the job he has long been tipped to want.

The announcement comes less than two hours after Mrs May succeeded David Cameron in No 10 with a promise to create "a country that works for everyone".

The Cabinet appointments are:

PHILIP HAMMOND

The Herald:

Philip Hammond has been appointed Chancellor of the Exchequer.

BORIS JOHNSON

The Herald:

Boris Johnson has been appointed Foreign Secretary.

AMBER RUDD

The Herald:

Amber Rudd has been appointed Home Secretary.

The former investment banker, venture capitalist, and financial journalist, 52, decided to enter politics in her 40s. 

The sister of leading Remain campaigner and businessman Roland Rudd, she was elected to Parliament as MP for Hastings and Rye.

MICHAEL FALLON

The Herald:

Michael Fallon is to stay on as Defence Secretary,

DAVID DAVIS

The Herald:

David Davis will become Secretary of State for Brexit.

David Davis was Europe Minister in the early 1990s and has since served as shadow home secretary, famously quitting as an MP over civil liberties, a cause he has campaigned hard for over the years.

LIAM FOX

The Herald:

Liam Fox has been appointed Secretary of State for International Trade.

By becoming Secretary of State for International Trade Liam Fox rejoins the ranks of Conservative heavyweights after years of being out in the cold.

The right-wing Brexiteer backed Theresa May after he was eliminated in the first round of the race for the Tory crown.

In backing the new Prime Minister Dr Fox stressed it was essential for the new leader to "have an understanding at the top levels of government and of international affairs and how the process in Whitehall operates".

The former defence secretary was cast into the margins of his party five years ago - forced to resign from the front benches in disgrace in 2011 after allowing his friend and best man Adam Werritty to take on an unofficial and undeclared role as his adviser.