Helen Liddell in the Press

Helen Liddell can't cope with Brian Wilson's briefs

But the re-shuffle has been criticised by Scottish nationalists and the Conservatives for putting politics before good governance.

Mr Dewar takes up the industry portfolio vacated by Brian Wilson who has been moved to the Department of Trade and Industry in Whitehall.

On taking up his new portfolio Mr Dewar said: "Business and industry are vital to the future well-being of the Scotland this government wants to create.

"That is why I have decided to take this portfolio myself to drive forward our policies for economic development and those associated with the New Deal."

The former Treasury Secretary, Helen Liddell, newly appointed as Mr Dewar's number two, will lead Labour's attack against the Scottish National Party and will also take on the education brief left by Mr Wilson.

Ms Liddell will also be responsible for women's issues, a brief left by the Home Affairs Minister Henry McLeish, who takes on the local government portfolio but loses transport .

The Health Minister Sam Galbraith is unaffected as is Lord Sewel at agriculture, fisheries and the environment.

Calum MacDonald will be responsible for housing, transport and European affairs. Additionally, he will look after Highlands and Island and Gaelic issues.

Mr Dewar said: "The distribution of portfolios means we have a team packed with experience in all of the key areas."

But SNP leader Alex Salmond said Mr Dewar's decision to take over the industry job rather than transfer it to Ms Liddell showed her main job would be "bashing the SNP".

"Donald Dewar already has one more publicly-funded special adviser than previous Scottish secretaries and the announcement of Helen Liddell's job adds to the concern that Labour are using public resources for party political purposes."

Scottish Tory Party Chairman Raymond Robertson said the changes were part of "the longest-running reshuffle in recent memory".

"Helen Liddell's appointment as education minister does little to remove the widely-held suspicion that her return to Scotland from the Treasury has more to do with party political motives than with the good governance of Scotland."