Tory leader Michael Howard has reshuffled his shadow Cabinet.

The outgoing Conservative chief has appointed George Osborne as shadow chancellor.

The appointment marks a rapid rise for Osborne, 33, who had previously served as shadow chief secretary to the Treasury and as William Hague’s speechwriter.

Osborne's close ally, David Cameron, was appointed shadow education secretary. That will put him against the up-and-coming education secretary Ruth Kelly.

Cameron, 38, was formerly the Conservative policy chief and was responsible for helping to draw up the party's general election manifesto.

But critics warn that both he and Osborne are inexperienced and could prove to be over-promoted.

Sir Malcolm Rifkind, the newly elected MP for Kensington and Chelsea, has taken the work and pensions brief.

Rifkind, who is a former foreign secretary, has been out of parliament for eight years and is also seen as a Tory leadership contender.

Speaking to the BBC, Rifkind said he was "absolutely delighted" with the news.

He added that he was "looking forward" to facing new work and pensions secretary David Blunkett across the despatch box.

However his appointment to a technical brief - and one generally regarded as low profile - could be seen as an attempt to keep him out of the limelight.

Other changes include Michael Ancram being shifted from the foreign affairs brief to the defence portfolio - a move seen as a demotion.

Dr Liam Fox has been moved from his post as co-chairman of the party to become Ancram's successor as shadow foreign secretary. That is a move which will be viewed as a reward for the election gains recorded last Thursday.

His replacement as party chairman is Frances Maude, who will be responsible for overseeing reforms to the party's structure in advance of the next general election.

David Willetts, who had been work and pensions spokesman, will shadow Alan Johnson at the Department for Productivity, Energy and Industry.

More junior appointments are expected shortly.