1976: Callaghan is new prime minister

Britain's new Prime Minister, James Callaghan, has arrived in Downing Street for his first day in office.

He returned from his audience with the Queen at Buckingham Palace to pose for photographs outside the door of Number 10 Downing Street with his wife Audrey.

Within hours, he made a televised address to the nation in which he promised a reforming government. However, he said, the future would not be easy.

"There is no soft option," he said. "I don't promise you any real easement for some time to come.

"There can be no lasting improvement in your living standards until we can achieve it without going deeper and deeper into debt as a nation."

Leadership contest

He made it clear that he considered the control of inflation his first priority. Unemployment, he said, was also too high - but could not be tackled until inflation had been brought under control.

Mr Callaghan's appointment follows the surprise resignation of long-standing Labour leader and Prime Minister Harold Wilson last month.

The result of the two-week leadership contest was announced just after 1600 BST (1500 GMT) to a packed meeting of the Parliamentary Labour Party.

Mr Callaghan had beaten his main rival, Employment Secretary Michael Foot, by 176 votes to 137.

Cabinet appointments

During his speech of acceptance, he paid tribute to Harold Wilson, and then asked for the party to "wipe the slate clean" and stop inter-factional squabbling.

In particular he asked the Tribune and Manifesto splinter groups - representing the extreme left and right of the party - to give their first loyalty to Labour.

He confirmed Denis Healey would remain Chancellor, and said Mr Foot would have a cabinet role, although he did not say which. Other Cabinet reshuffles are expected later in the week.

The media has already dubbed Mr Callaghan "Sailor Jim" after he revealed he had served as an ordinary seaman in World War II, as well as "Sunny Jim" for his upbeat temperament.

He comes to Number Ten from the Foreign Office, where he has served for the last two years in the Wilson cabinet.

It is the third senior cabinet post he has held. As Chancellor of the Exchequer from 1964-1967, he was forced to devalue the pound, after which he resigned.

He then served as Home Secretary until Labour lost the general election in 1970.

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