WILLIAM HAGUE ended his exile from frontline politics last night when he agreed to serve new Tory leader David Cameron as Shadow Foreign Secretary.

The appointment - to one of the top three Shadow Cabinet posts - hands the Richmond MP the job of developing a new Conservative emphasis on helping the developing world.

But, crucially, it will allow Mr Hague to retain some of the lucrative outside interests that have earned him an estimated £1m as Britain's best-paid backbencher.

The 44-year-old Mr Hague has sat on the backbenches since quitting as Conservative leader the day after his party's humiliating defeat at the 2001 General Election.

Previous job offers had been rejected, as he reaped the financial rewards of company directorships, newspaper columns and up to three after-dinner speeches a week.

But pressure had grown on Mr Hague to return to the frontbench amid growing Conservative confidence that, under Mr Cameron, a real revival is in sight.

Mr Hague, widely recognised as an outstanding parliamentary orator, retained his popularity with the Tory grassroots despite his lack of success as party leader.

Nevertheless, his return - along with the retention of defeated leadership candidate David Davis at home affairs - means Mr Cameron has picked right-wingers to hold key positions.

That will fuel Labour accusations that the new leader, despite his calls for the Tory party to have the courage to change, does not intend to move on to the all-important political centre ground.

Last night, Mr Hague's spokeswoman said he would give up his News of the World column - worth up to £200,000 a year - and would drastically reduce his speaking engagements.

But he would continue his directorships at two engineering companies and as a parliamentary advisor to the JCB manufacturing group.

In other appointments, Mr Cameron's closest ally, George Osborne, stays as Shadow Chancellor, while key moderniser Francis Maude is to stay in his post as Conservative chairman.

The biggest loser is Liam Fox who, despite a strong showing in the leadership race, is demoted from foreign affairs to the defence brief.

Mr Cameron also picked former leader Iain Duncan Smith to head a social justice commission and Kenneth Clarke, another defeated leadership rival, to lead a democracy taskforce.

A key strand of the former Chancellor's campaign was the allegation that democracy was being undermined because of Tony Blair's "contempt" for parliament.

However, in the first signs of discontent among the Tory front rank, Shadow Work and Pensions Secretary Malcolm Rifkind quit the shadow Cabinet over his failure to land the foreign affairs post.

The reshuffle came on the back of a confident and assured performance by Mr Cameron in his first head-to-head with Mr Blair at Prime Minister's questions.

The Tory leader was widely seen to have come out on top after breaking with his party's recent past by pledging to support Labour's controversial plans for schools to have greater freedoms.