Britain's newly-appointed Prime Minister Rishi Sunak on Wednesday warned that his government will have to take some "very difficult decisions" but assured the people that he would also act with compassion while tackling the country's "profound economic crisis."

Sunak, Britain's first Indian-origin Prime Minister, took office on Tuesday with a pledge to fix the "mistakes" his predecessor Liz Truss made which left a black hole in government finances and the markets in turmoil.

Sunak, the third prime minister in seven weeks, opened the Cabinet meeting by saying that "economic stability and fiscal sustainability would be at the heart" of his government's mission, according to a read-out from his first cabinet meeting.

"This morning I set out to Cabinet the enormous task we face, and why I am confident that this government can rise to the challenge and deliver for the whole United Kingdom," Sunak tweeted.

"Now is the time to get to work and earn the trust of the British people," he wrote after the first Cabinet meeting.

According to the read-out, the 42-year-old former Chancellor stressed that the government would need to take some "very difficult decisions, but the government would also act with compassion, protecting the most vulnerable, and would continue to seek long-term growth."

It said that Chancellor Jeremy Hunt stressed that economic stability and credibility were the essential foundations for all other policies.

Foreign Secretary James Cleverly then updated cabinet on the international situation and the continued threat posed by Russia's escalation of the war in Ukraine.

Home Secretary Suella Braverman spoke about ongoing work to tackle illegal immigration, the BBC quoted the read-out as saying.

Prime Minister Sunak said this was a complex and challenging issue but that the public rightly expected the government to find a "long-lasting solution".

Meanwhile, the UK government has delayed its budget by more than two weeks, buying Sunak some time to make difficult choices about how to tackle the country's economic crisis.

Finance minister Hunt will now deliver the government's medium-term fiscal plan on November 17, according to a statement from the Treasury.

It had been scheduled for October 31, after the date was previously pulled forward by more than three weeks in a desperate attempt to reassure investors spooked by huge unfunded tax cuts promised by former Prime Minister Truss.

Sunak on Tuesday unveiled his top team in place with key Cabinet appointments and decided to keep the new Chancellor, Jeremy Hunt, in place for economic stability and brought back Indian-origin Suella Braverman as Home Secretary.

In another move aimed at continuity, James Cleverly will stay in his post as Foreign Secretary despite not being a Sunak loyalist.

Braverman, whose scathing resignation letter precipitated Liz Truss' exit from Downing Street last week, is a fellow Bexiteer like Sunak.

Minister Without Portfolio Nadhim Zahawi told journalists the party was "very, very united" as he departed after the Cabinet meeting at 10 Downing Street.

Sunak has pledged to govern with "integrity" and has tried to unite the Conservatives by including people from different wings of the party in his top team.

In his first speech as Prime Minister in Downing Street, Sunak said Britain was facing a "profound economic crisis."

"I will place economic stability and confidence at the heart of this government's agenda," he said on Tuesday.

"This will mean difficult decisions to come," he said, while vowing to fix the "mistakes" of the previous government.

Sunak, a former investment banker-turned-politician, is the youngest British prime minister in 210 years. He is also Britain's first Hindu Prime Minister.

Sunak's victory in the Tory leadership race came at the end of a dramatic few days in Westminster since Liz Truss resigned last Thursday in the wake of a disastrous tax-cutting mini-budget and several policy U-turns.