Canadian prime minister brings in new-look team after scandal

OTTAWA, July 15 Mon Jul 15, 2013 10:51am EDT

OTTAWA, July 15 (Reuters) - Canadian Prime Minister Stephen Harper brought new, younger faces into his cabinet on Monday after an expenses scandal dented the Conservative government's popularity, but kept senior players such as Finance Minister Jim Flaherty in place.

"We need a steady hand on the tiller," a Conservative source told Reuters about the decision to keep Flaherty, 63, in a job that gives him a crucial role in managing the economy.

Flaherty, who is taking medication for a rare skin ailment, had made it clear he wanted to stay as finance minister until the federal budget is balanced, forecast for 2015.

Harper named James Moore, a rising star in the government, as industry minister with responsibility for telecommunications and the politically charged reviews of major foreign takeovers of Canadian companies.

Moore, heritage minister for almost five years, will now be the key point person responding to any bid to take over ailing smartphone maker BlackBerry Ltd, which reported disappointing sales and a wider than expected loss in its most recent quarter.

The Conservatives have long stressed their handling of the economy as a strength. Canada emerged faster from the 2008 recession than most other leading industrialized nations.

Although Harper brought eight new faces into the cabinet, most of them in secondary posts.

The right-of-center Conservatives - who do not have to face an election until October 2015 - have been on the defensive since May, when two members of Parliament's upper house, the Senate, quit the party caucus after improperly claiming expenses.

The scandal undermined the popularity of the party, which came to power in early 2006 promising to boost government accountability.

Recent polls have shown the Conservatives trailing the centrist Liberals, who are led by Justin Trudeau, the telegenic son of former Liberal prime minister Pierre Trudeau.