He replaces Peter Mandelson, who gave up responsibility for the dome alongside his trade and industry portfolio two weeks ago.

Lord Falconer: Sits on 14 Cabinet committees

Lord Falconer, who shared a flat with Prime Minister Tony Blair when the pair were young barristers, was previously solicitor general before moving to the Cabinet Office.

The addition of the dome to his responsibilities follows a row over the fact he sits on 14 Cabinet committees - more than any other government member, elected or appointed.

This was seized upon by those who allege cronyism and control freakery are hallmarks of the Blair government.

Under the new arrangement, Culture Secretary Chris Smith - who temporarily took charge of the dome following Mr Mandelson's resignation - will still take dome questions in the House of Commons.

Mr Smith on Tuesday morning insisted that Lord Falconer had been selected because he had the ability to ensure the dome was ready on time.

"I believe he's going to be absolutely the right man both to be the public front for the dome and to drive the project forward," he told BBC Radio 4's Today programme.

"What the dome is about is the whole nation, and that includes the business community but it includes the rest of us as well.

"The dome has to be an entertaining day out for the family but it must also be about something more serious than that - about looking to the future and the challenges that face us in the new millennium."

Shadow Culture Secretary Peter Ainsworth described the new formula as a failed opportunity.

"The appointment of Lord Falconer to take responsibility of the dome is yet another example of the cronyism that pervades this government.

"It was important that the person appointed had vision, flair and the appropriate business skills to take the project forward, give it credibility and engage national enthusiasm.

Chris Smith: Will still answers dome questions in the Commons

"In what way is Lord Falconer qualified to take on the task, other than the fact he is a close friend of Tony Blair?"

Lord Falconer declined offers on Monday to defend his appointment and offer his vision for the Millennium Dome in live interviews.

But he issued a statement, saying: "The dome at Greenwich will be the centrepiece of the UK's hugely diverse celebrations in the year 2000.

"Much has been achieved so far to deliver it on time and on budget. The year ahead holds further challenges to which I am sure the New Millennium Experience Company is more than equal."

The Conservatives had earlier demanded somebody from outside politics should be put in charge of the dome.

It is believed some members of Cabinet had already turned the job of government shareholder in the dome down on a permanent basis.

The other name that remained in the running for the post was Deputy Prime Minister John Prescott.

Mr Smith could not take up the job on a permanent basis because he is also chairman of the Millennium Commission, which distributes National Lottery money to the multi-million-pound project.