'Reassuringly boring' Hammond steps into the breach at MoD

In his first address to staff at the MoD, Liam Fox spoke of the need for stability in the department after the churn of the Labour years which had seen repeated changes at the top.

After a week of revelations, the military and civil servants were convinced that the only way of achieving this was by the departure of the beleaguered Defence Secretary.

The news of Mr Fox's successor was greeted by one senior official with "Let's all hope he has an unexciting personal life". Philip Hammond is not particularly well-known in the defence field but he comes with the reputation of being a hard-working minister who ran his previous department, Transport, efficiently and was popular with staff.

Mr Hammond had expected to be Chief Secretary to the Treasury, his shadow role, after the election but lost out in the sharing of portfolios in the coalition arrangement with the Lib Dems. Inheriting Defence, he will have to deal with the man who would have been his immediate boss, George Osborne, over funding. Mr Fox, as strategically leaked letters to Downing Street showed, was keen to establish that he was fighting for his department against the Treasury. Mr Hammond had been an advocate of the need for austerity, and military commanders would anxiously wait to see whether he takes a less robust stance over resources than his predecessor.

Apart from the budgetary problem, which the Government constantly blamed on a £38bn black hole left by Labour, there is the war in Afghanistan, unfinished business in Libya and deep dissatisfaction over the SDSR (Strategic Defence and Spending Review), which senior officers believe has been carried out too hurriedly and resulted in all three services facing massive cuts.

Mr Hammond can expect to be lobbied by commanders to revisit some of the most unpopular measures and taking up that cause would result in confrontations with the Treasury and Downing Street.

One senior officer said last night: "We are told we are getting a safe pair of hands, which is good. Liam Fox had to go because his position had become untenable. But it is also the case that he did fight for his department and had an empathy with the military. We hope Philip Hammond will try and undo some of the worse damages of the SDSR."

While Mr Fox was indeed seen as someone fought his corner for Defence he was also someone who deeply divided opinions within the Ministry. Many of the civil servants and military had begun to resent his increasing dependence on a small group of advisers, which at the end proved fatal for his political career.

On The Up: The Other Government Promotions

Chloe Smith

Succeeded Justine Greening as the youngest woman Tory MP when, aged 27, she won the 2009 Norwich North by-election, caused by the resignation of Labour's Ian Gibson during the parliamentary expenses scandal.

She takes over Ms Greening's job as Treasury Economic Secretary, which includes responsibility for environmental taxation, North Sea oil levies and tax credits. The youngest minister in the Government will be keen to show her status as a rising star is deserved. Some friends have expressed fears that she would be promoted too quickly. She has lived in Norfolk since the age of three.

Greg Hands

A member of George Osborne's "Praetorian guard", he was mobilised for a round of media interviews to support Liam Fox when the Chancellor threw a protective arm around him earlier in the week.

The 45-year-old MP for Chelsea and Fulham might have been a junior minister if the Conservatives had won an overall majority last year, but was among those who missed out when posts were handed to Liberal Democrats. Had to settle for an unpaid role as Mr Osborne's parliamentary private secretary but now gets a leg-up to ministerial rank as a government whip. Tipped for higher things.

Justine Greening

A strong performance in her 18 months as a Treasury Minister has won Justine Greening a promotion to the post of Transport Secretary.

David Cameron will be hoping that she will answer critics who claim there is a dearth of talent among his party's women MPs.

State-educated Ms Greening, 42, captured the Labour-held marginal of Putney in 2005 and was soon earmarked as one to watch. After being an opposition Treasury and Communities spokeswoman, she joined George Osborne's Treasury team after last year's election and soon passed the "Newsnight test".

Andrew Grice