Mr Morrison was sworn in as the nation's 30th prime minister on Friday night after defeating Peter Dutton in a leadership ballot to replace Malcolm Turnbull.

Former energy minister Josh Frydenberg will serve as his treasurer and deputy leader, replacing Julie Bishop.

"There has been a lot of talk this week about whose side people are on in this building," Mr Morrison told reporters at parliament house.

"What Josh and I are here to tell you, as the new generation of Liberal leadership, is that we are on your side."

Mr Morrison says the drought crippling Australia's eastern states is his highest priority.

His first order of business will be meeting newly-appointed national drought co-ordinator Stephen Day.

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"This is our most urgent and pressing need right now," Mr Morrison said.

He focused heavily on economic management and national security during his first public remarks, stressing everyone must "play by the rules".

"Whether you are a big business setting electricity prices or loaning money, or you are just someone parking in the street, we've all got to live by the rules of this country, the law of our land."

Mr Morrison batted away questions about why the Liberal Party tore down a sitting prime minister.

"You are looking at two people who did not do that today and were very loyal and committed to the government that we were privileged to form part of," he said.

However, Mr Morrison acknowledged he must also work to heal a party left "battered and bruised" after a bitter insurrection.

"Today our team needs to look at the events of this week and how that has impacted on them," he said.

"Where there needs to be changes, they will be made. Where there needs to be continuity, that will be maintained."

The incoming prime minister paid tribute to the "noble, professional" way Mr Turnbull served the country.

"He is a great Australian who has contributed a great deal to this country and our party and our nation will be very grateful for his contribution," Mr Morrison said.

He also talked up the "rock star" contributions of Ms Bishop in driving foreign policy.

"I will be talking to her, obviously, about what role she would like to play in the government we will now seek to put together."

His leadership rival Mr Dutton will also be offered a ministry.

"I look forward, if he so chooses, for him to be playing a role in the government which I intend to lead," Mr Morrison said.

The incoming prime minister has named power prices, chronic illness, affordable medicines and small business among his key policy concerns.

"The work of government continues," he said.

Mr Morrison must now work out his ministerial line-up and redraft the coalition agreement with the National Party.

In the not too distant future, he will also need to prepare for a by-election in the inner Sydney seat of Wentworth when Mr Turnbull resigns.

"I look forward to my first electoral test as a government. I look forward to it, I relish it," Mr Morrison said.

Australian Associated Press