No room for Kevin Rudd in Julia Gillard's new Cabinet

UPDATE 2.35pm: PM Julia Gillard has announced her new Cabinet today, with dumped leader Kevin Rudd not playing any part.

Julia Gillard presides over her first cabinet meeting as Prime Minister with, from left, Chris Evans, Wayne Swan, Joe Ludwig and Nicola Roxon. Picture: Ray Strange

UPDATE 2.35pm: PRIME Minister Julia Gillard has revealed her new Cabinet today, with dumped leader Kevin Rudd not playing any part.

Former Labor leader Simon Crean will take over Ms Gillard's education, workplace relations and social inclusion portfolios in a frontbench reshuffle, while Foreign Minister Stephen Smith will take over Mr Crean's trade portfolio responsibilities.

Ms Gillard said she had spoken to Mr Rudd and offered him a senior role if the Government was re-elected.

"There is nothing about this particular time that is easy or happy for Kevin Rudd," she said.

"What I've said to Kevin is that this is the best course."

After keeping a low profile over the weekend, Mr Rudd released a statement this afternoon saying he plans to take a family break before heading to his Queensland electorate to work for re-election.

In his farewell press conference after being dumped as prime minister, he said he planned to recontest the election later this year.

"I also said I would be prepared to serve the government in an appropriate way in the future and that I would do so in the interests of the government and the country,'' he said in a statement.

"I have indicated to the Prime Minister in subsequent discussions that this remains my position.''

He said decisions on cabinet appointments were a matter for the Prime Minister, which he respected.

Ms Gillard said today she wanted to avoid disruption in the reshuffle by keeping changes to a minimum.

"I have determined that it is best to have as limited a reshuffle as is possible to keep the maximum stability amongst the team and to keep our focus on the work that Australians need the government to be doing," she said.

Ms Gillard said stability was critical to her selection of ministers, and she would ensure that “all substantial decisions would go to full cabinet”.

Her comments follow heavy criticism of what was known as the “kitchen Cabinet”, which had comprised only of Rudd, Gillard, Swan and Lindsay Tanner.

"We want to have a proper system of cabinet government,'' Ms Gillard said. "That means that my colleagues in cabinet will shape cabinet committees.

"We have commenced work on that and that set of cabinet arrangements and rules but I couldn't be clearer here about my end-point and my intention, I want to see a traditional system of cabinet government where the cabinet is the highest decision-making body in the government.

"The team is the team as you see it.”

She said the shape of the Cabinet would be reviewed after the next election.

"I am not making any assumptions about what will happen on election day. This will be a close hard-fought contest,'' she said.

Ms Gillard said the government will be focused on delivering a strengthening economy and a renewed focus on services for "hard working Australians''.

One of Ms Gillard's first moves as Prime Minister was to change the focus of Population Minister Tony Burke's portfolio and change the title to "sustainable population'' to reflect her government's view on growth.

Ms Gillard said she would not be making "glib'' promises on what her government would do for fast-growing regions like western Sydney, where population is a hot topic, particularly among commuters.

"It would be easy for me to make a series of glib statements which would be interpreted as promises about new services,'' she said. "I'm not going to do that.

"We've got to take a measured approach here, a balanced approach.

"Anything you do in transport costs real money and my focus is on making sure we deliver that surplus in 2013.''

Mr Burke's task was about "taking a breath'' and planning for the future, she said.

Ms Gillard said Lindsay Tanner would remain finance minister up until the election. Mr Tanner announced last week that he would not be contesting the next election because of personal reasons.

She said Treasurer Wayne Swan and Mr Tanner will continue to work together on the nation's finances and the economy.

"This is in stark contrast to an opposition that appears to have absolutely nobody doing it,'' she said.

On climate change, Ms Gillard said her policy on emissions trading was the same as Mr Rudd's most recent policy.

She said the government would assess in 2012 the degree of international movement on climate change, and then make a final decision about reintroducing the ETS legislation.

Ms Gillard said the Australian people would be given the chance to judge her government on the resources super profits tax proposals, but said she would be negotiating “in a spirit of goodwill” with the mining industry.

Crean and Smith

Mr Crean said he was delighted to resume his involvement with “unfinished business” in the education portfolio, having served as minister for employment, education and training previously.

He said he would do what he could to lift participation in schools.

“This portfolio is linked closely to the economic prosperity of the country," he said.

"So anything that can be done to connect people much better with the workforce, to develop its skills, to give people the opportunity to continue developing those skills in a lifelong learning sense is fundamental to sustainable economic fortunes for the nation,'' he said.

Mr Smith said there were several critical trade activities for Australia, including the increasing importance of dealings with Indonesia and India.

He welcomed the G20 decision to push for a resolution of the Doha round and give it added priority.

Voters need time - Abbott

Over the weekend, Opposition Leader Tony Abbot appeared to confirm Coalition fears that the new Prime Minister is a more formidable opponent than Kevin Rudd, as he sought to deter Ms Gillard from capitalising on resurgent polling.

"I think that the public need to get to know the new Prime Minister to make a fair judgment of her but I don't know that she will want to give us that chance," Mr Abbott said.

The Liberal leader emphatically declared he previously had Mr Rudd's measure but Labor's leadership change made the election less certain.

"It will be tough because she is probably a more together politician than Kevin Rudd," he told ABC's Insiders program.

Labor's immediate bounce in opinion polls, including the Herald Sun's exclusive Galaxy Poll, has prompted some ALP figures to urge Ms Gillard to swoop and have the election in August.

Others, however, believe she should wait until September or October.

"The judgment I'm going to submit to, very soon, is the judgment of the Australian people," she told the Nine Network. "It's their birthright."

Ms Gillard has been working to strike a pre-election deal with the minerals industry over the controversial resources super-profits tax.

Shadow finance minister Andrew Robb said this meant a backdown was looming over the $9-billion-a-year tax and the Budget could collapse.

"Consequently, Labor will have no alternative but to bring down an emergency mini-Budget," Mr Robb said.

But Treasurer Wayne Swan insisted revenue from the mining tax would have "no impact whatsoever on the Government's plan to bring the Budget back to surplus in three years".

Ms Gillard continued receiving official courtesy telephone calls from world leaders yesterday, with new British PM David Cameron the latest to wish her well.

- with Michael Harvey and AAP