Osborne returns as Cameron's righthand man

David Cameron has reappointed George Osborne as his chancellor, with a sensitive new role in renegotiating a better deal for Britain in the EU ahead of a planned in/out referendum.

Mr Osborne's importance to Mr Cameron - and an indication of the prime minister's preference of successor - was underlined when the chancellor was also made first secretary of state, in effect deputy prime minister.

The title was previously held by William Hague, whom Mr Cameron once described as "my deputy in all but name", and by Peter Mandelson in the dying days of Gordon Brown's Labour government.

Theresa May will remain as home secretary while Philip Hammond, widely tipped to be replaced as foreign secretary, will also stay in his post. Michael Fallon stays as defence secretary; other cabinet appointments will be made on Monday.

The chancellor will play a pivotal role in Mr Cameron's planned EU renegotiation from the Treasury, alongside the prime minister and foreign secretary.

Deploying a cricket metaphor in an interview with the FT in March, Mr Cameron said: "There are three key batsmen in this innings and they are the prime minister, chancellor and foreign secretary."

Jean-Claude Juncker, European Commission president, congratulated Mr Cameron on his election victory on Friday saying: "I stand ready to work with you to strike a fair deal for the UK in the EU."

As she returns to the Home Office, Theresa May's immediate priorities will be pushing through policies that were blocked by Liberal Democrats during her previous tenure.

Top of the list will be allowing police and security services access to communications data - dubbed a "snoopers' charter" by critics and stopped by Nick Clegg over concerns that it would infringe the civil liberties of internet users.

She is also expected to bring in tougher new curbs against extremists and continue immigration reforms to clamp down harder on international students who are abusing the visa system.

The Home Office could also introduce a tighter immigration regime overall, as Ms May continues her party's "ambition" to bring net migration down to the tens of thousands.

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