THE 20TH CENTURY was a century in which for all our extraordinary achievements - most notably in World War II - Britain's power declined. But it can be rebuilt in a new way for a different age.
Some of the changes in the Eighties were necessary to do this, in removing obstacles to enterprise. Now it is a different type of change, a process not of removing barriers but of building the things necessary to equip our people and country to progress and prosper in the new economy and society being created around us.
On Saturday, January 1, as we usher in a new year, a new century, and a new millennium, we will not only be celebrating a once-in-a-lifetime event. We will, as a country, be looking back on and honouring our great past and looking forward to - indeed reaching out to - a challenging new future.
The last 100 years have brought wonderful advances in science, medicine and information technologies. Doctors tell us a baby born in the first year of the new century could easily live until the first year of the 22nd century. The computer and micro technologies are revolutionising our lives. Now is the time to harness these advances, not just for the benefit of a few, but for everyone.
Britain will not be the mightiest nation of the 21st century in size or population; but it can be the best, it can be that beacon to the world. Not only in taking to the challenge of the new economy but in developing a modern civil society built around tolerance and respect, where different races, creeds and religions live side by side in harmony.
In my view, successful nations in the new millennium will have at least some of these five characteristics.
First, they will be flexible and adaptable, able to meet the challenge of the pace of change. The human genome project, e-commerce, the Internet, mass communication will release a flood of technological change.
Second, the successful nations will see education as the key economic and social imperative for us all. The race for educational excellence for all, not just an elite, is on.
Third, a successful nation will develop new bonds of connection, of community. Even though today's world is individualised, the age of mass production over, diversity in lifestyle much more prevalent, people need communities. People need to feel a sense of belonging.
Fourth, nations will be driven to co-operate more across national boundaries. In a nuclear age, we will need better systems of international security, better channels of dialogue for peace.
Finally, nations that succeed will be tolerant, respectful of diversity, multi-racial, multi-cultural societies.
Some people might have predicted that, with the loss of our Empire, Britain would slowly fade away, swamped by the giants of America, Russia or China. But, as we enter the next century, I believe the reverse is true. We have every reason to be confident. For what makes Britain such a great place to live, to work, to grow up - the British character - is in tune with the times.
In a world that requires fast thinking we have some of the best creative brains. And in a world where global change produces insecurity, we have a history of pulling together and showing compassion to those less fortunate.
There's still no place on earth that has our combination of qualities. Our creativity, our determination, our courage, our sense of fairness.
Foreigners will continue to ask: why does such a small country produce so many great actors, singers, authors, architects? Why is there such a concentration of ground-breaking scientists, inventors, thinkers?
The answer I think is that there is still something called the British genius - a collection of qualities deep in our character.
We will always stand out as a nation, we will never be a run-of-the-mill people doing run-of-the-mill things - there's simply too much talent for that to happen. I want the next century to be one where Britain's worth is measured not in how much of the globe it owns or conquers, but measured by the achievements of its citizens, by the sort of people we want to become, the sort of society we choose to create.
The real threat to Britain succeeding in the next century would be a lack of self-belief, a failure to embrace change, to shape it for our own ends. That is why I urge us as a country to take those values that have made us great in the past and put them to work making Britain succeed in the future.