Michael Clarke's reign as Test captain might just be starting but his time as Twenty20 leader has ended. Clarke announced after the Ashes loss at the SCG that he would stand down from the role and will not play Twenty20, instead preferring to concentrate on regaining form in the five- and one-day arenas.

Cameron White has been named as Australia's captain for the two Twenty20 games against England next week, with Tim Paine confirmed as his deputy. The squad also includes Brett Lee, who will represent Australia for the first time since October 2009, as well as the uncapped Aaron Finch and James Pattinson.

Clarke struggled to keep pace with the demands of the shortest game because his technically correct batting was more suited to the longer formats. In 32 T20 internationals he had a strike-rate of 103, or slightly better than a run a ball, well below the output expected of a top-order player.

"I'm retiring from international Twenty20 cricket," Clarke said. "I guess, looking back on this series, my Test cricket isn't where I want it at the moment. This gives me the opportunity to focus wholly and solely on Test cricket and one-day and to use that time to play more domestic or first-class cricket for New South Wales and become a better Test player.

"For me, I've always said Test cricket is the ultimate for me. This gives me that opportunity. In saying that, obviously my T20 performances haven't been that great, which made the decision that much easier."

He captained the side in 18 matches and won 12 times, with the highlight being taking Australia to the final of the World Twenty20 in the West Indies in May. England beat Australia on that occasion too.

Clarke replaced Ponting as Test captain for the final game of this Ashes series, but will have to wait until August to learn if he will be the full-time leader. However, he will captain Australia in the upcoming one-day series against England, as Ponting continues to recover from his finger injury.

The two Twenty20s will be played next Wednesday and Friday, followed by seven ODIs beginning at the MCG on January 16. The chairman of selectors, Andrew Hilditch, said White was ready for the leadership of Australia's Twenty20 side and the selectors were keen to play Paine more often to help him prepare for when he eventually takes over from Haddin permanently.

"Cameron White has been named as captain of the Twenty20 team and Tim Paine vice-captain," Hilditch said. "We are confident that they will provide outstanding leadership for what is a very exciting Twenty20 team.

"Brad hasn't been picked in the side, he's obviously disappointed, but the reality is we need to take opportunites from time to time to look at other players. We think Tim has big future, we're keen to give him leadshership experience as well, which we're doing in the Prime Minister's XI game and this Twenty20 squad. Brad is still our No. 1 keeper in all forms of the game, but at this particular moment the right thing is to look at Tim Paine.

"The national selection panel is taking the opportunity to look at some of our exciting young talent in this form of the game. Aaron Finch has been in outstanding form for Victoria and the NSP looks forward to watching him play at the highest level in this form of the game.

"James Pattinson is one of a crop of young fast bowlers with great potential and he impressed with his stint with the Australian side in India. We're sure he's ready for the challenge of international cricket. The squad also sees the return of Brett Lee and Shaun Tait. Both at their best are explosive bowlers and should add greatly to the team."

Australia squad David Warner, Shane Watson, Cameron White (capt), David Hussey, Aaron Finch, Steven Smith, Tim Paine (wk), Steve O'Keefe, Mitchell Johnson, Brett Lee, James Pattinson, Shaun Tait.