Want to see how it all ends? Skip to approximately 8 minutes in.

First published by @Parlez_Me_nTory over at his blog.

The election campaign is already starting to get heated. Yes, those in the frame for Leader of the Labour Party are really stepping up a gear.

We all know it is General Election year #GE10 and the most likely date is 6th May, following a Budget full of empty promises of investment, prosperity and pay later schemes. But there is currently an election looming far sooner and far more meaningful for the Labour Party and potentially the country.

It is clearly understood that any leader of the Labour Party other than Gordon Brown following a coup would be able to narrow the Poll gap between themselves and the Conservative Party as the incumbent would inevitably enjoy the honeymoon period and the ‘bounce’ that goes with a personality change.

For months it was assumed that 26th March would be #GE10 thereby allowing the Government to avoid announcing any form of Budget but that would simply not allow enough time for the new leader to make the role his/her own.

Following a pre-Christmas party hosted by Charles Clarke the former Home Secretary and one of the most vocal anti-Brown campaigners it seems one output was to brief a series of coordinated press releases slamming the leadership of Gordon Brown and stating how better off the party and the country would be without him at the helm.

Briefings: Charles Clarke, Barry Sheerman, Greg Pope, Polly Toynbee

…the list of those present includes Parmjit Dhanda, Malcolm Wicks and Meg Munn

So then, who is the in the driving seat and who is set to star in the shake-up of the Labour party?

Or, are we to face yet another failed coup from a bunch of snipers who haven’t got the courage to do anything other than moan about how bad a Conservative Government would be for Britain?

We already know that Harriet Harman is to head up Gordon Brown and the PLP’s #GE10 campaign which sidelines Lord Mandelson (a very risky strategy indeed), but was this appointment simply to the *Fearless Five striking first?

*Fearless Five are a group of rebels led by Jack Straw, the others are Deputy Labour leader Harriet Harman, Chancellor Alistair Darling, Foreign Secretary David Miliband and Home Secretary Alan Johnson.

One also has to wonder how much Sarah Brown will be used throughout #GE10 as already she has persuaded an ex-colleague from the PR field, Helen Scott Lidgett to join her in the depths of the bunker.

Today, Gordon Brown will give a speech that will be full of empty promises and scorn on the Tories but will it be enough to stave the assassins from his door?

As you may or may not know LabourLost is not a site that has a particular agenda other than reflecting an accurate perception on the events that lead up to and including the General Election (GE) 2010.

During the run up to the GE we shall continue to use the #labourlost hashtag on Twitter and we shall also be using the #GE10 hashtag; there are several other suggestions doing the rounds but we believe #GE10 to be fully representative and utilising only 5 characters we believe it is also the best possible use of space for the purpose of Twitter.

So, come the election how will you vote?

Are you a core supporter of a particular Party? Have you always voted the same way?

What forged your opinions and political ethos?

Will you vote on the day with local requirements in mind, for instance against your normal beliefs because you like what a candidate has promised for your constituency?

Will you decide on the day or have you already made your mind up and nothing on this earth however said or done can change that?

Are you doing anything special to help your local candidate? Do you want to get involved but don’t know how to assist? (Whichever Party: use the comment form and we can try to let you know).

It is very clear at the moment that even the Pollsters don’t know what is happening or what is going to happen on the day and we can see this clearly almost on a daily basis with the Conservatives reported to be 17% clear whilst another poll claims Labour have cut the lead to just 9%.

Slowly we have threads of the new shaping of things to come with claim and counter from all sides, the slow unraveling of the pre-budget report and now the potential of a March election which would let Alistair Darling and Gordon Brown off the hook with regards to announcing the real budget and real state of the nation’s finances.

If we do have a March election it would be nigh on impossible to stage a TV Debate although it was blogged to this effect back in October by Parlez_me_nTory.

Just a few things to set the mind working in the run up to Christmas and that long period of plotting, electioneering and gathering of strategy. I love this period as the nation steadies its troops and all parties are placed on a war footing.

That was then…

This is now!

This afternoon David Cameron set out his new belief on the EU.

This explains why the ‘cast iron’ guarantee was not adopted and what we can expect from a Conservative Government with regards to Europe.

[Here is the speech in full]

Yesterday in Prague, the Czech Constitutional Court rejected the one remaining challenge to the Lisbon Treaty, and the President of the Czech Republic signed it.

The Lisbon Treaty has now been ratified by every one of the twenty seven member states of the European Union, and our campaign for a referendum on the Lisbon Treaty is therefore over.

Why? Because it is no longer a Treaty: it is being incorporated into the law of the European Union.

Next week, the new posts that the Lisbon Treaty creates – a President and a Foreign Minister – will be filled.

We cannot hold a referendum and magically make those posts – or the Lisbon Treaty itself – disappear, any more than we could hold a referendum to stop the sun rising in the morning.

I know, from the many public meetings I’ve held around the country, from the huge number of letters and emails that I receive, how much the people of this country will resent the fact that we cannot now have the referendum we were promised.

The decision to promise, and then deny, a referendum was taken by Tony Blair and Gordon Brown.

The betrayal was backed and matched by the Liberal Democrats.

And I believe it ranks alongside the expenses scandal as one of the reasons that trust in politics has broken down.

Of course I wanted a referendum on the Lisbon Treaty.

I’ve argued for it, campaigned for it, put it front and centre in our European election campaign.

We have voted for it in Parliament.

I’ve challenged the Prime Minister about his broken promise at every opportunity.

And if the Treaty had not been ratified by every European government when we came to the election, we would have held a referendum on it.

But now it has been ratified.

And I always said that if this happened, I would set out immediately how a Conservative Government would respond.

So today, I want to speak directly to the British people.

I want to explain what a new Conservative government will do to protect Britain’s interests in Europe and salvage something from the mess that Labour will have left us.

And I want to speak to our European partners too, to set out clearly what they can expect from a Conservative government in Britain.

NEVER AGAIN

First, we will make sure that this never happens again.

Never again should it be possible for a British government to transfer power to the EU without the say of the British people.

If we win the next election, we will amend the European Communities Act 1972 to prohibit, by law, the transfer of power to the EU without a referendum.

And that will cover not just any future treaties like Lisbon, but any future attempt to take Britain into the euro.

We will give the British people a referendum lock to which only they should hold the key – a commitment very similar to that in Ireland.

This is a major constitutional development.

But I believe it is now the only way to reassure the British people that powers cannot be given away without their explicit approval in a referendum.

It is not politicians’ power to give away – it belongs to the people.

So at the General Election, we will challenge the other political parties to accept the referendum lock and pledge never to reverse it.

NO MADE-UP REFERENDUM

I recognise there are some who, now that we cannot have a referendum on the Lisbon Treaty, want a referendum on something else…anything else.

But I just don’t think it’s right to concoct some new pretext for a referendum simply to have one for the sake of it.

That wouldn’t survive serious scrutiny.

I don’t think a made-up referendum will get Britain anywhere.

For instance, what about a referendum asking for a mandate for our negotiating aims in Europe?

We would have just asked for that mandate in an election and received it.

Would we really want to turn round straight after an election, with the public finances in the state they are in and the economy as fragile as it is and ask the same question all over again?

A made-up referendum might make people feel better for five minutes but my job is to put together a plan that lasts five years, and I don’t think a phoney referendum should play any part in that.

Let me repeat: a Conservative government will guarantee a referendum if there is any attempt to transfer further powers from Britain to the EU.

But if we wasted everyone’s time and taxpayers’ money on a referendum that has no practical effect, I don’t think the British people would thank us for it.

SOVEREIGNTY

In any case, there is more we can do than simply promise a referendum lock on any future handover of power.

Take the sovereignty of our laws.

Because we have no written constitution, unlike many other EU countries, we have no explicit legal guarantee that the last word on our laws stays in Britain.

There is therefore a danger that, over time, our courts might come to regard ultimate authority as resting with the EU.

So as well as making sure that further power cannot be handed to the EU without a referendum, we will also introduce a new law, in the form of a United Kingdom Sovereignty Bill, to make it clear that ultimate authority stays in this country, in our Parliament.

This is not about Westminster striking down individual items of EU legislation.

It is about an assurance that the final word on our laws is here in Britain.

It would simply put Britain on a par with Germany, where the German Constitutional Court has consistently upheld – including most recently on the Lisbon treaty – that ultimate authority lies with the bodies established by the German Constitution.

But people will rightly say that the Lisbon Treaty does not just transfer powers to Brussels today.

It allows further powers to be transferred in the future, because it contains a mechanism to abolish vetoes and transfer power without the need for a new Treaty.

We do not believe that any of these so-called ratchet clauses should be used to hand over more powers from Britain to the EU.

Furthermore, we would change the law so that any use of a ratchet clause by a future government would require full approval by Parliament.

These changes: the referendum lock, the Sovereignty Bill, stopping the use of ratchet clauses, all these changes can be put in place by our own Parliament.

They do not require the approval of our European partners – merely the sanction of the British people at the ballot box, which we will seek at the forthcoming General Election.

They will put in place real protection for our democracy – protections other countries have but which are missing here in Britain.

They would increase accountability, and they would ensure that the breach of trust committed by this Labour Government could never happen again.

Those two words – never again – will be on our leaflets, in our Manifesto: we will make sure that the British people remember who it was that broke their promise – Labour, and who it is that will stop this happening again – the Conservatives.

BRITISH GUARANTEES

But these measures are all about preventing problems in the future.

They don’t deal with the problems we are facing today, which will now be made worse by the ratification of the Lisbon Treaty.

In essence, these problems boil down to the steady and unaccountable intrusion of the European Union into almost every aspect of our lives.

A Conservative Government will address some of these problems by negotiating three specific guarantees with our European partners guarantees over powers that we believe should reside with Britain, not the EU.

First, social and employment legislation.

Of course, Britain used to have an opt-out from the Social Chapter: but Labour foolishly gave this up.

And today, too much EU legislation in this area is damaging both our economy and our public services.

So we will want to negotiate the return of Britain’s opt-out from social and employment legislation in those areas which have proved most damaging to our economy and public services for example the aspects of the Working Time Directive which are causing real problems in the NHS and the Fire Service.

The second British guarantee we will negotiate is over the Charter of Fundamental Rights.

We must be absolutely sure that this cannot be used by EU judges to re-interpret EU law affecting the UK.

Tony Blair claimed that his Government obtained an opt-out from the Charter.

But what he got – as the Government have now admitted – was simply a clarification of how it works in Britain.

We will want a complete opt-out from the Charter of Fundamental Rights.

The third area where we will negotiate for a return of powers is criminal justice.

We must be sure that the measures included in the Lisbon Treaty will not bring creeping control over our criminal justice system by EU judges.

We will want to prevent EU judges gaining steadily greater control over our criminal justice system by negotiating an arrangement which would protect it.

That will mean limiting the European Court of Justice’s jurisdiction over criminal law to its pre-Lisbon level, and ensuring that only British authorities can initiate criminal investigations in Britain.

I recognise, of course, that taking back power in these areas, or negotiating arrangements that suit the UK, is not something we can do unilaterally.

It means changing the rules of an institution of which we are a member – changing rules that Britain has signed up to.

If we want to make changes, we will need to do that through negotiation with our European partners, and we will need the agreement of all twenty seven member states.

I also recognise that these are highly complex areas, where we need to think through the practical details with great care.

William Hague is now leading detailed work to examine precisely what we will need to change, and, if we win the next election, his work will draw on the specialised legal advice which the Government has available to it, as well as the expertise of officials from the Foreign Office and other relevant departments.

But success in these negotiations will establish an extremely important principle: that European integration is not a one way street and that powers can be returned from the EU to its member countries, a principle that was envisaged in the Laeken Declaration nearly a decade ago.

Let me be clear. Our guarantees are essential, realistic and deliverable.

Essential, because we have identified the areas of the Lisbon Treaty that cause the deepest concern, and the ones with greatest potential to interfere with our democracy.

Realistic, because we will propose that these British guarantees are added as protocols to a future accession treaty – like the recently concluded Irish guarantees.

And deliverable, because we have chosen areas where the return of powers from the EU to Britain protects our distinctive national interests without harming the interests of our European partners.

THE NEXT PARLIAMENT

So, yes, I believe we will be able to negotiate the return of the powers I have set out.

But no, we will not rush into some massive Euro-bust-up.

We will take our time, negotiate firmly, patiently and respectfully, and aim to achieve the return of the powers I have set out over the lifetime of a parliament.

I know some people will want me to go further, and faster. To them let me say this:

If we win the election, we will inherit the worst public finances of any incoming government for fifty years.

We will have a generational challenge to get Britain to live within her means, to secure economic recovery and to deliver this country from the appalling mess left by this Labour Government.

That has to come before anything else.

THE LONGER TERM

These steps: a referendum lock to prevent this ever happening again, and the return of a specific set of powers. I believe these things can stop Britain’s relationship with the EU from heading in the wrong direction.

Clearly we will be asked the question: what if you cannot get these guarantees and what if Europe continues to head in the wrong, centralising direction? Let me answer that question in advance.

Well, if that were to happen, then of course we can return to this subject in a manifesto for the parliament after the next one.

Let me be clear: this is not something we want to happen. Nor is it something we expect to happen.

But if those circumstances were to occur, we would not rule out a referendum on a wider package of guarantees to protect our democratic decision-making, while remaining, of course, a member of the European Union.

But that would be a judgement for the future, not for this election or for the next Parliament.

What I have set out today settles our policy for the next parliament.

CONCLUSION

I just want to conclude by saying something clearly to our European partners.

My purpose in committing any government I lead to these measures is not to frustrate or to sabotage the operation of the European Union.

It is to put Britain’s role in the EU on a more positive footing.

As we commemorate the twentieth anniversary of the fall of the Berlin Wall, we should remember that the European Union has done much to reconcile the painful division of Europe and to spread democracy and the rule of law across our continent.

But it should not rest on those achievements.

Today, European countries need to work together to combat global climate change, to fight global poverty, to boost global economic growth.

If I am elected Prime Minister, the British Government I lead will be an active member of the European Union.

On energy security, on climate change, on growth, on global poverty, we will look forward to working with our European partners to make progress on those issues.

We will press to keep the doors of the European Union open to new member states, especially to entrench stability in the Western Balkans where so much European blood has flowed, and also to Turkey.

We will stand for open markets, and a strong transatlantic relationship; an EU that looks out to the world, and that builds strong and open relations with rising powers like China and India.

We will want to see a tough financial settlement in the forthcoming negotiations on the EU budget, ensuring that Britain does not pay more than its fair share.

We will pay particular attention to the area of financial regulation, where we will be vigilant and tenacious in defending the competitiveness of the City of London.

Like every other Member State, we will fight our corner to advance our national interests.

But our guiding principles will be these: we believe Britain’s interests are best served by membership of a European Union that is an association of its member states, we will never allow Britain to slide into a federal Europe and that means we will watch closely how the Lisbon Treaty works out in practice.

We will put in place a referendum lock, so never again can a British government transfer powers to the EU without the people giving their consent in a referendum.

We will enact a United Kingdom Sovereignty Bill, making clear that ultimate authority rests with our Parliament.

And we will negotiate for a specific set of British guarantees that are realistic, deliverable – and essential.

That is our programme for Government.

That is the mandate we will seek at the next election.

In this area – Britain’s relationship with Europe – what people want from their politicians is some straight talk and plain speaking.

They were told we were joining a Common Market and it turned out to be a European Union.

They were told they would have a say over the European constitution but that promise was broken.

People are fed up with the endless lies and spin, they just want to know what we can achieve and how.

That is what I will deliver.

I said we would leave the federalist group in the European Parliament and we did.

I said we would have a referendum on the Lisbon Treaty and if it hadn’t been ratified we would have had that referendum.

But I did not promise a referendum come what may because once the Lisbon Treaty is the law, there’s nothing anyone can do about it and I’m not going to treat people like fools and offer a referendum that has no effect.

What I am promising today is doable, credible, deliverable.

That’s what this is all about.

Giving the British people a policy on Europe that they can actually believe in.

This guest post has been contributed by Julian Bray who writes on his Duckhouse blog.  Over to you Julian.

The British Army has been forced to cut the number of new soldiers it recruits to save money, official MoD document.

In 2008, the Army took in 14,280 new people, while 14,070 personnel left. A 500-place recruitment cut would have meant the Army brought in fewer people than it lost

According to MoD document ref:“ABN 57/09 In Year Savings Measures” Savage cuts in manpower are part of a £97 million package of spending reductions forced on the Army this year. This follows the UK Governments spending of over a TRILLION POUNDS STERLING to prop up the all but bust banking sector, the virtually unlimited printing of banknotes by the Bank of England (other banks are also available!) and to pay for MP’s expenses, Duck Houses, Moats, Food, Cleaners and so on.

Training for Territorial Army soldiers and the renovation of soldiers’ housing – already in a poor condition have also been cut to save the faces of several politicians.

The reductions in training and recruiting are now raising concerns about the impact on the Army’s future capabilities. The squeeze on the Army’s already strapped budget has emerged in the same week that beleaguered Prime Minister Gordon Brown, currently bumping along the bottom of the opinion polls, announced he will send another 500 British troops to Afghanistan. He did however put several conditions on the deployment, none of them medical or relating to his own health.

Ministers have publicly and repeatedly insisted that the Armed Forces are properly funded, but the Army document drawn up this week for the MoD shows that Army recruitment has been cut by 500 from January to relieve “pressure” on the manpower budget. The very same number earmarked for active service in Afghanistan.

The MoD paper, dated October 13 2010, obtained by the Military World website is entitled “ABN 57/09 In Year Savings Measures”. It outlines cuts drawn up by General Sir David Richards, the Chief of the General Staff and rubber stamped by the not very impressive Bob Ainsworth, the current defence secretary.

Sir David has already made cuts of £43 million to help the MoD balance its budget, but at a stormy meeting of the Defence Board last month, he was told to come up with another £54 million of reductions, an amount less than the MoD’s annual spend on spin doctors.

The Daily Telegraph revealed last month that the MoD spent more than pounds 61 million on public relations last year.

To avoid direct cuts from the Afghan operation, Sir David has been forced to reduce the Army’s training and recruitment activities.

The paper states: “The planned recruit intake into the Army Recruiting and Training Division is to be reduced by 500 to help reduce the specific pressure on the Army manpower budget.”

In 2008, the Army took in 14,280 new people, while 14,070 personnel left. A 500-place recruitment cut would have meant the Army brought in fewer people than it lost. The recruitment cut will be felt across the Army. The only units to be spared from the cuts are the so-called “pinch point” trades where there are already deep shortages of specialists, and those infantry regiments with the worst recruiting records.

The recruitment cut will deprive the Army of £2 million in the current financial year, the MoD paper claims.

“The planned recruit intake into the Army Recruiting and Training Division is to be reduced by 500 to help reduce the specific pressure on the Army manpower budget,” the document concludes.

After intense criticism from opposition parties, campaigners and commanders, ministers made repeated promises to improve the standard of accommodation for soldiers, but shamefully the document reveals that housing has also fallen victim to the cuts. Another £14 million of cuts will be made by delay some planned upgrade work on single soldiers’ living accommodation.

The Army had planned to upgrade 790 housing units this year. Now only 205 of those projects will be completed on time this year.

The MoD paper, widely distributed to commanding officers and senior officials this week, says the cuts are needed for the MoD to “remain within budget in this financial year.”

It says: “Financially, these are difficult times and the MOD, like all Government departments, is required to produce major cost savings.”

“Our priority is to support current operations and these measures are necessary to focus remaining resources on the main effort. These measures will not affect current operations.”

The document also confirms that training for Territorial Army soldiers will be cut by £20 million. That follows a £23 million cut earlier in the year. A budget reduction of £43 million in less than a year.

David Cameron, the Conservative leader, said the “unacceptable” cuts are affecting reservists due to go to Afghanistan next year.

Another £4 million will be cut from funding for school cadet forces. As Chancellor in 2006, Gordon Brown announced the expansion of cadet units, saying he wanted more children to participate in them.

University Officer Training Corps will also lose £3 million.

The cut in Army recruiting and training should raise questions about Government/MoD runaway spending on civilian officials. The MoD currently employs 85,730 civil servants. Britain now has more military bureaucrats for every active serviceman than any of its NATO allies..

Liam Fox, the Conservative shadow defence secretary, accused Labour of being: “disgraceful and penny pinching.”

He said: “Too often, this Government has simply not been up to the task on defence. We need forces that are better supplied with equipment.. In Afghanistan and elsewhere, whether we’re dealing with equipment or other things, we’re willing the ends, but not the means.”

About Julian:  Julian Bray is a broadcaster, moderator, speaker, journalist and lectures on leadership, company turnarounds, corporate and recession busting strategies, politics, aviation, travel and The City.

This afternoon, David Cameron took to the stage in Manchester to make his speech not just to his Party and the Party faithful but to the nation as a whole.

The full text of his speech follows bringing the Conservative Party conference and our coverage of it to a close.

I want to get straight to the point.

We all know how bad things are, massive debt, social breakdown, political disenchantment. But what I want to talk about today is how good things could be.

Don’t get me wrong, I have no illusions. If win this election, it is going to be tough. There will have to be cutbacks in public spending, and that will be painful. We will need to confront Britain’s culture of irresponsibility and that will be hard to take for many people. And we will have to tear down Labour’s big government bureaucracy, ripping up its time-wasting, money-draining, responsibility-sapping nonsense.

None of this will be easy. We will be tested. I will be tested. I’m ready for that – and so I believe, are the British people. So yes, there is a steep climb ahead.

But I tell you this. The view from the summit will be worth it.

AFGHANISTAN

If we win the election the first and gravest responsibility I will face is for our troops in Afghanistan and their families at home.

I know that.

I know about the mothers and the wives, the husbands and the children, counting the minutes between news bulletins, fearing the announcement of the next casualty. I know what they want – and deserve – from their government. A ruthless, relentless focus on fighting, winning and coming home.

That must start at the top. Instead of a revolving door at the Ministry of Defence with a second rate substitute in charge, we need a politician from the front rank, and in Liam Fox we have one.

We need a clear chain of command that flows right from the top. My national security council, with the key ministers and defence chiefs, will sit from day one of a new government, as a war cabinet.

We need a strategy that is credible, and do-able. We are not in Afghanistan to deliver the perfect society. We are there to stop the re-establishment of terrorist training camps.

Frankly, time is short. We cannot spend another eight years taking ground only to give it back again.

So our method should be clear……send more soldiers to train more Afghans to deliver the security we need. Then we can bring our troops home.

And I know the most urgent requirement of all. That those brave men and women we send into danger have every piece of equipment they need to do the job we ask of them. I will make sure that happens.

And I have something else to say. When the country is at war, when Whitehall is at war, we need people who understand war in Whitehall.

That’s why I’m proud to announce today that someone who has fought for our country and served for forty years in our armed forces will not only advise our defence team but will join our benches in the House of Lords and if we win the election could serve in a future Conservative Government:

General Sir Richard Dannatt. As we welcome him to serve with us, let us all salute those who serve our country.

FAMILY, COMMUNITY, COUNTRY

We could have come to Manchester this week and played it safe. But that’s not what this party is about and it’s certainly not what I’m about.

When I stood on that stage in Blackpool four years ago it wasn’t just to head up this party, sit around and wait for the tide to turn. It was to lead this party and change it, so together we could turn the tide.

Look what we’ve done together. More women candidates, campaigning on the environment, the party of the NHS. And this year, here in Manchester, our most successful, dynamic conference for twenty years.

I’d like to thank everyone involved, the police who kept us safe and your chum and mine, Eric Pickles.

But also this year, in these difficult times, we’ve won the argument on the economy and debt as George Osborne showed in that magnificent speech on Tuesday.

That was the success we achieved this year.

But for me and Samantha this year will only ever mean one thing. When such a big part of your life suddenly ends nothing else – nothing outside – matters. It’s like the world has stopped turning and the clocks have stopped ticking. And as they slowly start again, weeks later, you ask yourself all over again: do I really want to do this? You think about what you really believe and what sustains you.

I know what sustains me the most. She is sitting right there and I’m incredibly proud to call her my wife.

My beliefs. I am not a complicated person. I love this country and the things it stands for.

That the state is your servant, never your master. Common sense and decency. The British sense of community.

I have some simple beliefs.That there is such a thing as society, it’s just not the same thing as the state. That there is a ‘we’ in politics, and not just a ‘me.’

Above all, the importance of family. That fierce sense of loyalty you feel for each other. The unconditional love you give and receive, especially when things go wrong or when you get it wrong. That powerful sense you have when you hold your children and there’s nothing, absolutely nothing – you wouldn’t do to protect them.

This is my DNA: family, community, country. These are the things I care about. They are what made me. They are what I’m in public service to protect, promote and defend. And I believe they are what we need in Britain today more than ever.

I know how lucky I’ve been to have the chances I had. And I know there are children growing up in Britain today who will never know the love of a father. Who are born in homes that hold them back. Who go to schools that keep them back.

Children who will never start a business, never raise a family, never see the world. Children who will live the life they’re given, not the life they want. That is what I want to change.

I want every child to have the chances I had. That is why I’m standing here.

BIG GOVERNMENT

But we won’t help anyone unless we face up to some big problems. The highest budget deficit since the war. The deepest recession since the war. Social breakdown; political disillusionment. Big problems for the next government to address.

And here is the big argument in British politics today, put plainly and simply. Labour say that to solve the country’s problems, we need more government.

Don’t they see? It is more government that got us into this mess.

Why is our economy broken? Not just because Labour wrongly thought they’d abolished boom and bust. But because government got too big, spent too much and doubled the national debt.

Why is our society broken? Because government got too big, did too much and undermined responsibility.

Why are our politics broken? Because government got too big, promised too much and pretended it had all the answers.

Of course it was done with the best intentions. And let’s be clear: not everything Labour did was wrong.

Devolution; the minimum wage; civil partnerships, these are good things that we will we keep.

But this idea that for every problem there’s a government solution for every issue an initiative, for every situation a czar….

It ends with them making you register with the government to help out your child’s football team. With police officers punished for babysitting each other’s children. With laws so bureaucratic and complicated even their own Attorney General can’t obey them.

Do you know the worst thing about their big government? It’s not the cost, though that’s bad enough. It is the steady erosion of responsibility. Our task is to lead Britain in a completely different direction.

So no, we are not going to solve our problems with bigger government. We are going to solve our problems with a stronger society. Stronger families. Stronger communities. A stronger country. All by rebuilding responsibility.

THE DEBT CRISIS

The clearest sign of big government irresponsibility is the enormous size of our debt.

If we win the election, we will have to confront Labour’s Debt Crisis, deal with it, and take the country with us. I want everyone to understand the gravity of our situation.

Our national debt has doubled in the last five years and our annual deficit next year will be over £170 billion.

That’s twice as big as when we nearly went bankrupt in the 1970s. It is a massive risk to our economy. If we spend more than we earn, we have to get the money from somewhere.

Right now, the Government is simply printing it. Sometime soon that will have to stop, because in the end, printing money leads to inflation. Then the Government will have to borrow it.

But we’ll only be given the money if lenders are confident we can pay it back. If they’re not, we’ll have to pay higher interest rates and that could stop our economic recovery in its tracks.

So we have three choices.

Option one: we can just default on the debt. Not pay it. Other countries have done that in the past. But I don’t think anyone in this country wants to go down that road.

Option two: we could encourage inflation, which would wipe out the value of the debt, making it easier to pay off. But that’s not just an economic disaster – it’s a social disaster too. It doesn’t just wipe out debts, it wipes out people’s hard-earned savings.

So we have the third option – for me the only option. We must pay down this deficit. The longer we leave it, the worse it will be for all of us.

I know there are some who say we should just wait.

Don’t talk about the deficit. Don’t even plan for what needs to be done. Just wait. Don’t they understand – it’s the waiting that’s the problem.

The longer we wait for a credible plan, the bigger the bill for our children to pay. The longer we wait, the greater the risk to the recovery. The longer we wait, the higher the chance we return to recession.

Here’s the most obvious reason we can’t wait. The more we wait, the more we waste on the interest we’re paying on this debt.

Next year, Gordon Brown will spend more money on the interest on our debt than on schools. More than on law and order, more than on child poverty.

So I say to the Labour Party and the trades unions just tell me what is compassionate, what is progressive about spending more on debt interest than on helping the poorest children in our country?

The progressive thing to do, the responsible thing to do is to get a grip on the debt but in a way that brings the country together instead of driving it apart. That means showing leadership at the top which is why we will cut ministers’ pay and freeze it for a parliament.

It means showing that we’re all in this together which is why we’ll freeze public sector pay for all but the one million lowest paid public sector workers……for one year to help protect jobs.

And it means showing that the rich will pay their share which is why for now the 50p tax rate will have to stay and Child Trust Funds for those on middle and higher incomes will have to go.

Yes we have made some tough choices. But in British politics today that is the only responsible thing to do.

PENSIONERS

Dealing with this debt crisis is not just about cuts in the short term. We must also live within our means over the long term. Everyone knows we have an ageing population.

Our pension system was designed in a time when many people didn’t live till 70 …. It is out of date and it has to change. That’s why this week we made the difficult decision to bring forward the raising of the pension age.

I know that working longer will be tough for many people. But it will also allow us to help pensioners more.

I got an email from a lady who wrote to me in desperation. She doesn’t want me to reveal her name because she’s so frightened of what might happen to her.

She and her husband left school at fifteen and started work straight away. They bought their own home, where they’ve lived for forty years. But they’ve been let down terribly. She lost out on the 10p tax and took a drop in her pension. She and her husband aren’t entitled to pension credit because they saved for their old age.

Here’s what she says:

“during the cold spell this winter, we sat watching TV with blankets wrapped around us.

The drug dealer and the druggies who live nearby had their windows wide open and the heating full on.

We don’t bother watching police dramas on the TV, we just look out of our window.

Our savings are making no money.

If one of us dies we cannot afford to stay in our home.”

This lady doesn’t want pity. Pensioners don’t want pity. They just want to know that if they’ve lived responsibly, they’ll be looked after in their old age.

Parties have been talking about raising the pension in line with earnings for years. But it never happens.

Well let’s be the party that finally makes it happen. Because of the difficult choice we’ve made on the pension age we’ll be able not just to deal with our debt but to raise the basic state pension in line with earnings. Not just for one year, but for every year.

GROWTH

Cutting back on big government is not just about spending less. Getting our debt down means getting our economic growth up.

Let’s be clear where growth will come from. Not big government, with its Regional Development Agencies and National Investment Corporations but entrepreneurs. New businesses, new industries, new technologies.

I get enterprise. I worked in business for seven years. And let me tell you what I learned during that time.

Complicated taxes, excessive regulations they make life impossible for entrepreneurs.

So I will always put the same questions to Ken Clarke and his business team.

What are you doing to make it easier to start a business? Easier to take people on? What are you doing to make regulation less complicated? To make locating a business here more attractive?

Ken Clarke and David Willetts this week helped launch our plan to Get Britain Working.

It is a plan to boost science, skills, self-employment a plan to improve training, technology, tax incentives for entrepreneurs.

This is what it means.

It means the man who’s lost his job and his confidence saying yes, I can set up on my own, I can take responsibility, there’s nothing to stop me.

It means the people he takes on, who thought they were written off, thinking yes I’ve got another chance and I can provide for my family again.

Self-belief is infectious and I want it to spread again throughout our country especially through the poorest places where Labour let hope fade away.

In Britain today, there are entrepreneurs everywhere – they just don’t know it yet. Success stories everywhere – they just haven’t been written yet. We must be the people who release that potential.

FINANCIAL REFORM

And just a quick word to the man who says he abolished boom and bust and then saved the world.

It was you Gordon Brown who designed the system of financial regulation that helped cause the financial crisis. You want to keep it the same. We say it needs to change.

That’s why we will give back to the Bank of England its power to regulate the City powers that should never have been taken away.

BROKEN SOCIETY

But once we’re generating economic growth – what are we going to do with it? What kind of society do we hope to build?

Look at Britain in 2009. It is, in so many ways, a great place to live. Great culture and arts, great diversity, great sport.

And think of the great sport coming up next year England in the World Cup, then the Olympics, then rugby and cricket too. And yes, let’s get the Football World Cup here in 2018 as well.

But in Britain today there is a dark side as well. After twelve years of big government, we still have those stubborn social problems.

Poverty, crime, addiction. Failing schools. Sink estates. Broken homes.

The truth is, it’s not just that big government has failed to solve these problems. Big government has all too often helped cause them by undermining the personal and social responsibility that should be the lifeblood of a strong society.

Just think of the signals we send out. To the family struggling to raise children, pay a mortgage, hold down a job.

“Stay together and we’ll give you less; split up and we give you more.”

To the young mum working part time, trying to earn something extra for her family “from every extra pound you earn we’ll take back 96 pence.”

Yes, 96 pence.

Let me say that again, slowly.

In Gordon Brown’s Britain if you’re a single mother with two kids earning £150 a week the withdrawal of benefits and the additional taxes mean that for every extra pound you earn, you keep just 4 pence.

What kind of incentive is that? Thirty years ago this party won an election fighting against 98 per cent tax rates on the richest. Today I want us to show even more anger about 96 per cent tax rates on the poorest.

And in that fight, there’s one person this party can rely on. He’s the man who has dedicated himself to the cause of social justice…and shown great courage in standing up for those least able to stand up for themselves. Iain Duncan Smith

And I am proud to announce today that if we win the election he will be responsible in government for bringing together all our work to help mend the broken society.

LABOUR AND POVERTY

Labour still have the arrogance to think that they are the ones who will fight poverty and deprivation.

On Monday, when we announced our plan to Get Britain Working you know what Labour called it? “Callous.”

Excuse me? Who made the poorest poorer? Who left youth unemployment higher? Who made inequality greater?

No, not the wicked Tories… you, Labour: you’re the ones that did this to our society.

So don’t you dare lecture us about poverty. You have failed and it falls to us, the modern Conservative Party to fight for the poorest who you have let down.

FAMILY

We’ll start with what is most important to me – and what I believe is most important for the country – families.

I believe that a stable, loving home is the most precious thing a child can have. Society begins at home. Responsibility starts at home. That’s why we cannot be neutral on this.

Now I don’t live in some fantasy land where every family is happily married with 2.4 kids. Nor am I going to stand here and pretend that family life is always easy.

But by recognising marriage and civil partnerships in the tax system and abolishing the couple penalty in the benefits system, we’ll help make it that little bit easier.

But it’s not just about money. It’s also about emotional support, particularly in those fraught early years before children go to school. Labour understood this and we should acknowledge that.

That’s why Sure Start will stay, and we’ll improve it. We will keep flexible working, and extend it. And we will not just keep but transform something that was there long before Sure Start began – health visitors.

But making the country more family-friendly is not just about what government does. Responsibility goes much wider. It’s about what we all do. It’s about the way we live.

Why aren’t we building homes with enough room for a family to sit round a table and actually eat a meal together?

It’s about our culture. Why do so many magazines and websites and music videos make children insecure about the way they look or the experiences they haven’t even had?

And it’s about our society. We give our children more and more rights, and we trust our teachers less and less. We’ve got to stop treating children like adults and adults like children.

It is about everyone taking responsibility. The more that we as a society do, the less we will need government to do.

WELFARE

But you can’t expect families to behave responsibly when the welfare system works in the opposite direction.

In welfare, big government has failed people in a big way. There are two million children in Britain growing up in homes where no-one works. Two million.

That is the highest in Europe. It is one in six children in our country.

We have to break this cycle of welfare dependency.

I got an email from a guy called Viv Williams. He lost his job last year and was desperate to get back into work. But he had a mortgage to pay so he went to register for Job Seeker’s Allowance.

He’d twisted his ankle and walked in with a limp, so you know what they said? They told him he couldn’t register for Job Seeker’s Allowance because he wasn’t fit to work so he’d have to go on incapacity benefit.

He told them there was nothing wrong with him, that he wanted to work. But no – he wasn’t allowed to.

This is a man who wanted to take responsibility for himself and his family and the system said no, you’ve got to depend on the state.

As he says: “I told them, you’re having a laugh.” But it’s not funny. The welfare system today sends out completely crazy signals.

We have got to turn it around and with Theresa May and David Freud in charge we will. We’re going to make it clear: If you really cannot work, we’ll look after you. But if you can work, you should work and not live off the hard work of others.

NHS

So we have to reform welfare and strengthen families. But when I think of my family, in the end there’s only one thing that matters and that is that the people I love are healthy and well.

My family owes so much to the National Health Service. No, it is not perfect. But I tell you, when you’re carrying a child in your arms to Accident and Emergency in the middle of the night and don’t have to reach for your wallet it’s a lot better than the alternative.

So we will never change the idea at the heart of our NHS, that healthcare in this country is free at the point of use and available to everyone based on need, not ability to pay.

But that doesn’t mean the NHS shouldn’t change. It has to change because for many people, the service isn’t good enough. Mostly, that’s not the fault of those who work in the NHS.

The fault lies with big government. With their endless targets and reorganisations, Labour have tried to run the NHS like a machine.

But it’s not a machine full of cogs. It is a living, breathing institution made up of people – doctors, nurses, patients.

This lever-pulling from above – it has got to stop. With Andrew Lansley’s reform plans, we’re going to give the NHS back to people. We’ll say to the doctors: those targets you hate, they’re gone.

But in return, we’ll do more for patients. Choice about where you get treated. Information about how good different doctors are, how good different hospitals are.

Information about the things that really matter, cancer survival times……the rate of hospital infections……your chances of surviving if you have a stroke.

We will give doctors back their professional responsibility.

But in exchange they will be subject to patient accountability. That’s why we can look the British people in the eye and say this party is the party of the NHS now, today, tomorrow, always.

CRIME

The instinct to protect the people we love is so strong. Nearly two years ago it was that instinct – that love – that drove Fiona Pilkington to do something desperate.

When I first read her story in the paper I found it difficult to finish the article – it’s one of the saddest things I’ve ever read.

Fiona was so driven to despair by the vile thugs that bullied her and her lovely disabled daughter Francecca and by the police that didn’t answer her cries for help that she could only see one way out. She put her daughter in her car, drove to a lay-by, and set it on fire.

If no one would protect them then by ending their lives, she was keeping them safe.

No one could hurt them anymore. Just think about what we allowed to happen here in our country. This goes deep and it’s been going on for years.

It is about a breakdown of all the things that are meant to keep us safe……a complete breakdown of responsibility.

A breakdown of morality in the minds of those thugs a total absence of feeling or conscience. A breakdown in community where a neighbour is left to reach a pitch of utter misery. And a breakdown of our criminal justice system.

Every part of it, the police, the prosecution services, the prisons……is failing under the weight of big government targets and bureaucracy. The police aren’t on the streets because they’re busy complying with ten different inspection regimes. The police say the CPS isn’t charging people…because they have to hit targets to reduce the number of unsuccessful trials.

And the prisons aren’t rehabilitating offenders…because they’re focused on meeting thirty-three different performance indicators.

This all needs to change. I’m not going to stand here and promise you a country where nothing bad ever happens. I do not underestimate how difficult it will be to deal with this problem of crime and disorder.

We cannot rebuild social responsibility from on high. But the least we can do the least we can do is pledge to all the people who are scared, who live their lives in fear and who can’t protect themselves, that a Conservative Government, with Chris Grayling, with Dominic Grieve, will reform the police, reform the courts, reform prisons. We will be there to protect you.

TERRORISM

We understand too the grave responsibility we will have to protect our people from terrorism. This party knows only too well the pain and grief that terrorism brings.

Twenty-five years ago, almost to the day on the Thursday night of our party conference in Brighton, the IRA exploded a bomb that injured and killed good friends and colleagues.

Today let us honour their memory and send our thoughts and best wishes to all those, including Margaret Tebbit, who still bear the scars of that terrible night.

SCHOOLS

To build a responsible society we need to teach our children properly. I come at education as a parent, not a politician.

When I watch my daughter skip across the playground to start her first term in year one, I want to know that every penny of the education budget is following her and the other children into that school and that classroom.

So when I see Ed Balls blow hundreds of millions on so-called “curriculum development” on consultancies, on quangos like the QCDA and BECTA like every other parent with a child at a state school I want to say:

This is my child, it’s my money, give it to my headteacher instead of wasting it in Whitehall.

But it’s not just about money. It’s about values. We know that discipline is vital but we overrule head teachers when they exclude a disruptive pupil.

We know that every child has different abilities and different needs but too often we put them all in the same class so the brightest aren’t stretched and those who are struggling fall behind.

We know that competitive sport is important but we’ve had minister after minister promising it and nothing ever happens.

Discipline. Setting by ability. Regular sport.

These are all things you find in a private school. Not because the Government tells them to do it, but because it’s what parents want. Why can’t parents in state schools always get what they want?

With us, they will, because our reforms will create more good schools and more school places. Yes, our plans will increase competition – and no, that is not a dirty word. It means that when a good new school opens down the road, the other ones around it will want to improve. Big government has totally failed in state education and with Michael Gove we will get the radical change we need.

COUNTRY

Family, community, country. In recent years we’ve been hearing things about our country we haven’t heard for a long time. People saying they don’t know what it is to be British, what this country stands for.

People in Scotland who want to leave the United Kingdom and people in England who say let them go.

I am passionate about our Union and I will never do anything to put it at risk. And because of the new political force we have created with the Ulster Unionists, I’m proud that at the next election we will be the only party fielding candidates in every part of the United Kingdom.

Britishness is not mechanical, it’s organic. It’s an emotional connection to a way of life, an attitude, a set of institutions.

Make these stronger and our national identity becomes stronger. To be British is to be open-minded.

We don’t care who you are or where you’re from, if you’ve got something to offer then this is a place you can call home.

But if we want our country to carry on with this proud, open tradition, we’ve got to understand the pressures of mass immigration and that’s why we need to put limits on it.

To be British is to be generous. Whenever there’s a disaster on the other side of the world, British people dig deep into their pockets and give their money. Comic Relief didn’t raise less money this year because of the recession – it raised more.

That says big things about our country, and government should reflect that. That’s why I’m proud that we’ve ring-fenced the budget for international development.

To be British is to be sceptical of authority and the powers-that-be.

That’s why ID cards, 42 days and Labour’s surveillance state are so utterly unacceptable and why we will sweep the whole rotten edifice away.

And to be British is to have an instinctive love of the countryside and the natural world. The dangers of climate change are stark and very real. If we don’t act now, and act quickly, we could face disaster.

Yes, we need to change the way we live. But is that such a bad thing? The insatiable consumption and materialism of the past decade, has it made us happier or more fulfilled?

Yes, we have to put our faith in technologies. But that is not a giant leap. Just around the corner are new green technologies, unimaginable a decade ago, that can change the way we live, travel, work.

And yes, we need global co-operation. But that shouldn’t be difficult. It just takes leadership, and that’s what we need at the Copenhagen summit this December.

POLITICS

But if you care about our country, you’ve got to care about the health of our institutions. And today one of them, more than any other, is in a serious state of decline.

Our parliament used to be a beacon to the world. But the expenses scandal made it a laughing stock.

We apologised to the public, paid back the money that shouldn’t have been claimed……and published all our expenses online to help stop this happening again.

We’ve led the way in other areas too……MPs’ pay and pensions, cutting the cost of politics. But let me make something clear – this is not over.

We are just starting the job of building the new politics we need. Because the anger over expenses reflected something deeper. The sense that people have been left powerless by big government.

So it is time to shake things up. We need to redistribute power and responsibility. It’s your community and you should have control over it……so we need decentralisation. It’s your money and you should know what is being done with it……so we need transparency. It’s your life that’s affected by political decisions and the people who make those decisions should answer to you, so we need accountability.

EU

But if there is one political institution that needs decentralisation, transparency, and accountability, it is the EU.

For the past few decades, something strange has been happening on the left of British politics. People who think of themselves as progressives have fallen in love with an institution that no one elects, no one can remove, and that hasn’t signed off its accounts for over a decade.

Indeed even to question these things is, apparently, completely beyond the pale. Well, here is a progressive reform plan for Europe.

Let’s work together on the things where the EU can really help, like combating climate change, fighting global poverty and spreading free and fair trade.

But let’s return to democratic and accountable politics the powers the EU shouldn’t have.

And if we win the election, we will have as the strongest voice for our country’s interests, the man who is leading our campaign for a referendum, the man who will be our new British Foreign Secretary: William Hague.

WHAT WE CAN PROMISE

Family, community, country.

Recognising that what holds society together is responsibility……and that the good society is a responsible society. That’s what I’m about – that’s what any government I lead will be about.

The problems we face are big and urgent. Rebuilding our broken economy……because unless we do, our children will be saddled with debt for decades to come.

Mending our broken society……because unless we do, we will never solve those stubborn social problems that cause the size of government to rise.

Fixing our broken politics……because unless we do, we will never reform public services……never see the strong, powerful citizens…who will build the responsible society that we all want to see.

This week you’ve heard about our plans, our policies, the changes we want to make and the team to put them in place.

But I know that whatever plans you make in Opposition, it’s the unpredictable events that come to dominate a government.

And it’s your character, your temperament and your judgment, not your policies and your manifesto – that really make the difference.

You can never prove you’re ready for everything that will come your way as Prime Minister. But you can point to the judgments you’ve made. And you can learn from the mistakes that others have made.

I’ve seen what happens when you win and you waste your mandate obsessing about the 24 hour news cycle and fighting each day as if it’s a new general election, ducking the difficult things that would have really made a difference.

That was Blair. And I’ve seen what happens when you turn every decision into a political calculation. That was – that is – Brown.

So I won’t promise things I cannot deliver. But I can look you in the eye and tell you that in a Conservative Britain:

If you put in the effort to bring in a wage, you will be better off. If you save money your whole life, you’ll be rewarded. If you start your own business, we’ll be right behind you. If you want to raise a family, we’ll support you. If you’re frightened, we’ll protect you.If you risk your safety to stop a crime, we’ll stand by you. If you risk your life to fight for your country, we will honour you.

Ask me what a Conservative government stands for and the answer is this, we will reward those who take responsibility, and care for those who can’t.

CONCLUSION

So if we cut big government back. If we move society forward.

And if we rebuild responsibility, then we can put Britain back on her feet.I know that today there aren’t many reasons to be cheerful.

But there are reasons to believe. Yes it will be a steep climb. But the view from the summit will be worth it. Let me tell you what I can see.

I see a country where more children grow up with security and love because family life comes first. I see a country where you choose the most important things in life – the school your child goes to and the healthcare you get. I see a country where communities govern themselves – organising local services, independent of Whitehall, a great handing back of power to people.

I see a country with entrepreneurs everywhere, bringing their ideas to life – and life to our great towns and cities. I see a country where it’s not just about the quantity of money, but the quality of life – where we lead the world in saving our planet. I see a country where you’re not so afraid to walk home alone, where you’re safe in the knowledge that right and wrong is restored to law and order.

I see a country where the poorest children go to the best schools not the worst, where birth is never a barrier.

No, we will not make it if we pull in different directions, follow our own interests, take care of only ourselves.

But if we pull together, come together, work together – we will get through this together.

And when we look back we will say not that the government made it happen…

…not that the minister made it happen…

…but the businesswoman made it happen…

…the police officer made it happen…

…the father made it happen…

…the teacher made it happen.

You made it happen.

After William Hague set the bar VERY high yesterday those who take to the stage at the Conservative Party conference have a large weight of expectation upon their shoulders.

This morning, George Osborne the Shadow Chancellor delivered a speech that was clear and unambiguous with an undertone of togetherness repeatedly stating “we’re all in this together”.

Here is the full text:

We know what the task is.

Britain is coming out of the deepest recession since the war.

Our country is facing the largest budget deficit in our modern history.

And we will have no choice but tackle it decisively if we are to stop high interest rates and the unemployment they bring.

Yet at the same time the next Conservative Government is determined to leave public services and society stronger than it finds them.

Put bluntly.

Labour created this mess.

Everything we have done in this Party:

- all the changes we have brought about;

- all the judgements we have made;

- all the leadership that you David have shown us;

all these things have prepared us for this moment – the moment when we ask to take our country forward at a time of enormous difficulty.

Our unwavering commitment to fiscal responsibility as the root of economic stability.

Our understanding that millions of Britons depend on public services and cannot opt out.

Our conviction that precisely because so many depend on them, those services need radical reform.

Our determination as compassionate Conservatives to protect the most vulnerable.

Our hard-headed recognition that, without enterprise and aspiration, compassion comes with an empty wallet.

It is the combination of these values that define the modern Conservative Party.

And there’s something else.

After a year in which trust in Parliament has been rocked to its foundations, we know that politics must change forever.

We have to be open and transparent with the people we serve.

We need to offer a complete change from the double counting, the fiddled figures, the off balance sheet trickery, the stealth taxes and the feckless irresponsibility of the last twelve years.

We must rescue a lost generation from the jobs crisis that afflicts our country.

We must move this economy from one built on debt to one sustained by saving and investment.

The government borrowed too much.

The banks borrowed too much.

Let’s tell the truth – we all borrowed too much.

Were we the only people in the world who did this? No, we were not.

Were we the ones who did it most? Yes, we were.

Now we reap the terrible consequences.

One in five young people cannot find work.

One pound in every four the state spends goes straight on the national debt.

More of our taxes go on paying the interest on that debt than on educating our children or defending our country.

Britain cannot go on like this.

We are sinking in a sea of debt.

I believe it is a terrible mistake to claim, as Gordon Brown does, that there is a choice between getting to grips with the debt and having an economic recovery.

Of course the pace of fiscal tightening has to be determined in co-ordination with the independent Bank of England and monetary policy.

And we will create an independent Office for Budget Responsibility to hold us to our course.

But you cannot have a sustained recovery until you show the world that Britain can pay its way.

And let me tell you, the world is watching Britain at the moment.

It is casting doubt on our country’s creditworthiness.

It is questioning our resolve to deal with our debts.

And when that starts to happen, then long term interest rates rise, and international investment dries up, and businesses fail, and unemployment rises still further, and the recovery is killed stone dead.

We saw it the last time a Labour Government ran out of money.

And we must never allow our country to be dragged there again.

So we need to show political leadership and take the difficult decisions.

What a disgrace that a Chancellor who is borrowing £175 billion this year didn’t even mention it in his Conference speech.

The Prime Minister called him last week ‘a great Chancellor’, conveniently forgetting that three months ago he tried to sack him.

What does it say about Gordon Brown that he got into a trial of strength with Alistair Darling and lost.

And while we’re on the Prime Minister. This man has in front of him confidential Treasury advice that he’s got to cut spending by 10%.

What a disgrace that he spends his Conference speech unveiling a list of new unfunded spending commitments when he can’t pay for the last lot.

When he should have been giving this country a lead, he went shopping on Brighton Pier with the nation’s credit card.

The Iron Chancellor has turned into the plastic Prime Minister.

Free social care. Free hospital parking. Free childcare places.

We would all like those things. But where is the money coming from?

He is treating the British people like fools.

If you want to know why this is the least trusted government we have ever known then look at the nonsense they spouted at their Conference last week and you will have your answer.

Speaker after speaker, Prime Minister after Chancellor, said we opposed the bail out of the banks.

Do they think no one will remember our Party Conference last year in Birmingham?

That none of the journalists, let alone the audience here, would remember when David Cameron interrupted the schedule to come onto the stage and pledge the support of the opposition?

We supported the bank bailouts last autumn.

Not for political advantage, because we knew we wouldn’t get any.

We did it because David and I genuinely believed it was the right thing to do.

And all our big economic judgements come down to that.

The judgement at our Conference three years ago to tell you that we were not going to come up with a list of unfunded tax cuts.

And who doubts that was the right judgement now.

The judgement to tell the British people twelve months ago, when it wasn’t fashionable, that the cupboard was bare.

Or the judgement last November to oppose the VAT cut.

That wasn’t the easy thing to do.

You try being the Shadow Chancellor who tells the Conservative Parliamentary Party that we are going to vote against a tax cut.

But who now doubts that was the right thing to do.

For not a single government in the world followed Britain’s VAT cut.

Hardly a single major retailer thinks it worked.

David Cameron and I have always put sound money and stability ahead of everything. And who now argues against that?

This June we told the truth and said publicly that whoever won the election would have to cut government spending.

The Prime Minister told Parliament week after week that the choice was now ‘investment versus cuts’.

But the public realised the choice wasn’t cuts versus investment.

It was reality versus fantasy.

Prudence versus profligacy.

Truth versus lies.

Never has a government’s economic position collapsed more comprehensively in the face of an opposition’s argument.

We made the right call.

And if anyone still needed proof that we are now in control of the argument on the economy, it came last night.

As we have argued for months, pay restraint is necessary and the debt crisis needs addressing.

But for the Chancellor of the Exchequer to sneak out public sector pay policy in the middle of the Conservative conference, when he didn’t have the guts to announce it to the Labour Party Conference tells you that these Labour politicians are better at writing books about courage than displaying it themselves.

This is about character as well as policy.

Now we face the biggest challenge.

How to build the sort of Britain we want in the face of the largest deficit in the developed world.

Let me tell you the distinctive approach modern Conservatives will take to making that judgement.

I can’t give you the 2010 Budget in 2009.

But I want you to understand the sort of Government we will be, and the sort of decisions we will take.

First, modern Conservatives understand that we are all in this together.

There cannot be one rule for Westminster and Whitehall, and another rule for everyone else.

It is not the quantity of money saved so much as the example set.

We will cut the pay of Ministers by 5% next year and then freeze it for the rest of the Parliament.

We will cut the number of MPs by 10%.

And Parliament will be required to do what so many hard-pressed businesses have been forced to do, and close its unaffordable pension scheme to new members.

And what we ask of Westminster, we will also ask of Whitehall and its quangos.

The excessive salaries at the top have to go.

In the current climate, anyone who wishes to pay a public servant more than the Prime Minister will have to put it before the Chancellor.

I am not expecting a long queue.

The tax relief on private sector pensions is capped, so the time has come to find ways to impose a £50,000 annual cap too on the size of public sector pension payouts.

And a Conservative Britain won’t need such a huge army of regulators, inspectors and central planners second-guessing the professional judgement of every teacher, nurse and police officer.

And we won’t need a huge tier of regional government second-guessing the decisions of elected local councillors either.

I tell you today that the next Conservative Government will cut the cost of Whitehall by one third over the next Parliament.

Westminster and Whitehall subjected to the same disciplines as everyone else.

A £3 billion pound a year saving in bureaucracy alone.

We are all in this together.

Second, modern Conservatives believe in decent public services.

We know that the vast majority of families depend on them and cannot opt out.

The idea that David Cameron and any Cabinet he leads – the idea that the modern Conservative Party – would callously damage those public services is a shameful lie.

Under David’s leadership we have committed to increasing health funding each year.

We have become the Party of the NHS.

Yes, we want to reform public services.

Unless we reverse the dramatic fall in productivity over which this government has presided, one thing is certain – the frontline will suffer.

Progressive Conservative reform or Labour frontline cuts – that’s the real dividing line in British politics.

Departmental budgets will have to be set to get more for less across the public sector.

It’s what successful businesses do everyday.

This constant process of:

- rooting out waste;

- eliminating failing programmes;

- reviewing procurement;

- publishing spending information online

- increasing productivity

- ending the constant stream of pointless eye-catching initiatives;

all this will make the greatest contribution to reducing the budget deficit.

Tens of billions of pounds will have to be saved this way.

The reform of public services will be driven not just by those who manage them, but by the choices of those who use them.

We are all in this together.

Third, modern Conservatives have a huge respect for the many committed public servants.

Conservatives should never use lazy rhetoric that belittles those who are employed by the government.

Our job should be to motivate those people and get the best out of them.

But it is because we treat those who work in our public sector with respect that I want to be straight with you about the choices we face.

At a time of crisis, there is an inevitable and difficult trade off between securing jobs and restraining pay.

Anyone who tells you otherwise when the budget deficit is this big is misleading you.

It is the same trade off that has been made at British Telecom, Vodafone, Jaguar and – incidentally – Channel 4 and the Guardian.

No one should pick on public sector workers.

I will not ask them to make any sacrifice or shoulder any burden that the rest of Britain is not being asked to make.

And government must honour commitments already made.

But today I tell you in all candour that if you look at the nation’s finances.

What the Government announced yesterday will not be enough. It covers less than a fifth of the public sector workforce.

You will see that whoever wins the election is going to have to ask from 2011 each part of the public sector to accept a one year pay freeze.

We shouldn’t include public servants earning less than £18,000.

Because I don’t believe in balancing the budget on the backs of the poorest – and nor do you

Nor of course would anyone want to include those risking their lives for this country in Afghanistan – we owe them so much more.

Indeed, we should double their operational allowance.

I know it is difficult to ask such hard working people to accept this freeze.

But I want to be straight with you.

A pay freeze of the scale I’m talking about is the equivalent to saving 100,000 public sector jobs.

And I say to every public sector worker it is the best way to try to protect your job during this difficult period.

We are all in this together.

And modern Conservatism includes understanding that everyone being in it together involves the rich making their contribution too.

I am no fan of high tax rates.

We know that in the long run they destroy enterprise.

That is why we should not accept Labour’s new 50 per cent tax rate on the highest earners as a permanent feature of the tax system.

But we could not even think of abolishing the 50p rate on the rich while at the same time I am asking many of our public sector workers to accept a pay freeze to protect their jobs.

I think we can all agree that would be grossly unfair.

We will also target tax evasion and off-shore tax havens.

Remember we were the first to ask the non doms to make their fair contribution.

Everyone must pay their share.

I have a tough message to the bankers too.

The support from the taxpayer when you needed it most was there to prop up your banks not your bank accounts.

Don’t forget that.

I hope the new international rules work.

It is the best solution.

But if we find the money that should be going into stronger bank balance sheets is being unreasonably diverted into bigger pay and bonuses – we reserve the right to take further action and that includes using the tax system.

I have given you a fair warning.

For I believe in the free market not a free ride.

And I believe we are all in this together.

But none of this will work unless we do something else modern Conservatives believe.

We will never mend our broken public finances unless we start to fix our broken society.

The cost of broken families and broken communities is paid for by every hard working taxpayer.

That is why we are going to support marriage in the tax and benefit system.

That is why, as you heard yesterday, we are going to devote an enormous effort to help the unemployed and get Britain working.

Along with our reforms to incapacity benefit, we also have to take a realistic look at the benefits the rest of society receives.

We will preserve child benefit, winter fuel payments and free TV licenses. They are valued by millions.

But quite frankly child trust funds have not been as successful as many like myself hoped.

We should continue paying them to the poorest families who often have no savings, and encourage them to use them more – but, let me tell you today, handing out new baby bonds to the rest of the country is a luxury we can no longer afford.

And I can also tell you today, we can no longer justify paying means tested tax credits to families with incomes over £50,000.

A modern Conservative Government will not ask from anyone what it is not prepared to ask from everyone.

Here’s one more part of the modern Conservative approach to putting Britain back on the right financial track.

We want to turn an economy that borrows into one that saves.

At every stage we will support the culture of saving, and for those who show responsibility for themselves and others.

Encouraging savings is why I made my promise that only millionaires would pay inheritance tax.

Of course this financial crisis means it cannot be a priority for our first Budget, but in the lifetime of a Parliament we will honour that pledge.

A savers society is our ambition.

So we are going to stop more and more pensioners being driven onto the means test.

Let me affirm today that in the next Parliament we resolve to restoring the earnings link for the basic state pension.

That means a more generous state pension for all.

But this is another one of those trade-offs any honest government has to confront.

All parties accept that to afford that with an ageing population, the state pension will have to rise.

The women’s pension age is already set to start rising over the next decade to 65. And by 2026 the pension age for men and women will reach 66.

This is already happening.

But most experts – including Lord Turner who made this recommendation – now think that is too far off.

So we will hold the review which Turner’s Report itself proposed and which this government has never held.

Our aim will be to bring forward the date when the pension age rises.

This already is happening in Germany, in Holland and in Australia

We will ensure that no increase will happen until the second half of the next decade – in the Parliament after next.

For men this means the pension age will not start to rise to 66 until at least 2016.

For women this means the pension age will not start to rise from 65 to 66 until at least 2020.

No one who is a pensioner today, or approaching retirement soon, will be affected.

But this is how we can afford increasing the basic state pension for all.

One final thing on a saving society.

I today set this ambition for a future Conservative Government.

It’s an ambition we will only be able to fulfil when we have got on top of the deficit.

It’s an ambition that may well take more than one parliament to achieve.

Gordon Brown’s disastrous tax raid on pensions heralded the start of the age of irresponsibility.

So today I say we will reverse the effects of Gordon Brown’s pensions tax raid and get our country saving again.

That saving will fund investment – investment in real business.

I want to talk very directly to the people at home.

Conservatives have been straight with you today:

- A bigger state pension each year for all paid for by an increase in the pension age of one year

- A one year public sector pay freeze, that does not apply to the lowest paid, in order to protect the jobs of 100,000 people working in frontline public services

- Tackling Britain’s debt crisis to stop higher interest rates and higher unemployment for all

These are the honest choices in the world in which we live and we have made them today.

Anyone who tells you these choices can be avoided is not telling you the truth.

We are all in this together.

Friends, I have done this job for more than four years.

I have done it when no one trusted our Party with the economy, and I do it now when we have earned that trust and when the expectations of millions rest on our shoulders.

I have learned many things along the way.

Trust your values.

Don’t just follow the crowd, or you will end up lost.

Accept there will be hard knocks.

Understand that with the opponents we face, it will only get more personal the more desperate they become.

Above all over the last four years I have learned that you have say the true things that need saying or not bother doing the job at all.

That is what I have done today.

In the new era of politics which we have entered into, after what Parliament has been through this year, nothing else is possible.

I have got two young children.

I want a prosperous Britain where my children can be everything they can be.

I want an optimistic Britain where my children can be part of a strong, tolerant, generous society.

I want my children to think that our generation paid off its debts, valued its savers, rewarded responsibility, invested in their future.

And because I want it for my children, I want it for your children too.

I want it for everyone’s children.

Because we are all in this together.

We changed the Conservative Party to be ready for this moment.

So that when the moment came, people would see us fit to govern.

People would trust us with public services.

People would join us to fix the broken society.

And people would turn to us to lead the economy out of crisis.

We changed the Conservative Party so that:

to a country that says it is time for a change;

we can say we are ready to make the change.