George Osborne: 'I don't look back at the Thatcher years or remember the winter of discontent'

Shadow Chief Secretary to the Treasury

When George Osborne was 22, he undertook "the worst job in the world". He was ordered to attend a Labour Party conference and mingle with hard-left delegates as the official Conservative Party "observer".

When George Osborne was 22, he undertook "the worst job in the world". He was ordered to attend a Labour Party conference and mingle with hard-left delegates as the official Conservative Party "observer".

"You had to walk around with a pass that said 'Conservative Party' on it," he recalls. "This was in the days when Labour went to Blackpool."

The year was 1994 and Tony Blair, newly elected leader, was about to declare war on the unions to modernise the party. The conference turned out to be historic - for the Tories as much as for Labour. "I listened to Tony Blair make his first speech as leader where he announced he was getting rid of Clause IV," he recalls. "I thought at the time that the Conservative Party was going to face a massive problem with this guy - which turned out to be the case."

Now, as Mr Blair's popularity wanes, it is with relief mixed with admiration that he describes "the passing of the age of Blair".

"For much of my life, Tony Blair has been the dominating figure of British politics," he says. "Because of my age [33], I don't look back on the Thatcher years or have memories of the winter of discontent. My adult lifetime has been about a Blair-dominated political environment. Now you are seeing the visible transfer of power away from Tony Blair towards Gordon Brown."

He hopes a Tory victory will speed the end of the Blair age, and says the changes within Labour are "a fascinating development to see and a profound change of my political lifetime".

Mr Blair has had a more specific influence on Mr Osborne's career. For almost a decade, the Oxford-educated former journalist has schooled every Tory leader - from John Major to Michael Howard - on how to wrongfoot Mr Blair at Prime Minister's Questions. "One of my functions was to try to guess what the Prime Minister was going to say," he explains.

Within a few years, he found he could do quite a convincing Blair impression at the weekly rehearsals - though he is adamant that he will not perform for The Independent.

"I don't necessarily do it with all the voices and hand gestures," he says squirming in a white faux leather armchair at Tory HQ. "I will not do my impression."

Yet as he protests, he is unconsciously doing a rather good take-off of the PM. His arms are waving around in a Blairite kind of way, and he uses terms like "look" and "guy". He is also flashing a "trust me, I'm an ordinary kind of guy, really" look.

Finally, exasperated, he gives in. "Look," he says, hands outstretched like the Right Honourable member for Sedgefield. "You don't do deals about this kind of thing."

A Tory onlooker laughs. The impression is pretty good, and appears to come naturally. But his similarity to Mr Blair goes deeper than the odd mannerism and a slight physical resemblance.

Since he entered Parliament in 2001, Mr Osborne has been identified as a potential party leader. Older Conservatives saw his promotion, at 33, to shadow Chief Secretary to the Treasury as a test of his mettle. He may be bright and articulate, but can he survive the glare of the television lights during an election?

Labour was quick to seize on an admission he made on Sky that the Tory tax cuts would not come in immediately, but in 2006 - a year after the first Budget. Labour said this proved that the Tories could not afford tax cuts in the first year of a Conservative government.

But the Tories defend Mr Osborne and say he was just stating the facts, as set out in published documents.

So when will the three tax-cutting measures announced by the Conservatives put cash in people's pockets?

"They are all announced in the first Budget which will be in June, within a month of the election. And they all come into effect in the following financial year, April 2006," he says.

Two planks of the Tory tax-cutting programme - lifting the threshold for stamp duty and helping pensioners with council tax - rely on Bills being passed through Parliament.

"It would be a brave Opposition that stopped our council tax discount proposals," he says. "You announce it in the Budget, pass the legislation in the summer and the autumn and it is ready for the next financial year."

Mr Osborne was part of the team that framed the £4bn tax-cutting programme. But he is strangely wary about the party ruling out future tax rises."I don't make any promises like that on tax because it is completely pointless. Politicians have made far too many promises on tax that they don't keep - both Conservative and Labour. General blanket promises not to increase taxes are not worth the paper they are written on."

He refers to pledges by previous governments, including Tory ones, as evidence of this. "For the Conservative Party it would have perhaps been an easy option for us to say we rule out any increases in income tax or increases in national insurance," he says. "I just don't think people would believe that, just as they don't believe Labour."

Mr Osborne is resolutely on the modernising wing of the Conservative Party, and looks a little uncomfortable when challenged about his party's immigration policy. "I don't think our message on immigration says anything other than that we need a managed immigration policy," he protests.

However, he acknowledges that the Conservatives "have got to be careful about the language we use in this campaign".

Then, in mid-flourish, Mr Osborne, the heir to the Osborne & Little wallpaper and upholstery fortune, uses the "B" word.

"Settled Asian communities in Manchester are angry that when they want a family member to come into the country there is a long and elaborate process. Then they see bogus asylum-seekers hiding in the back of a lorry," he says.

It is a bit of a surprise to hear him use a term like "bogus", which is unofficially banned in the vocabulary of asylum. He seems so modern in every other sense and, quite unprompted, extols the desirability of having more black and gay MPs. Unlike some of his superannuated colleagues, politically correct terms such as "ethnic minority" trip off his tongue quite naturally.

"It has been important for the Conservative Party to demonstrate that we understand Britain as it is today," he says.

The party should not "have a view that every woman should be at home baking a cake for her husband when he returns from work, that homosexuals have no place in our society or, indeed, that ethnic minorities have no place in our society".

There was a time, not so long ago, when criticising cake bakers would have been heretical in Tory circles. But Mr Osborne is bold and goes further. "If we do well in this election, the face of the Conservative parliamentary party will be transformed," he says. "There will be many more younger people. We will have more openly declared gay MPs, and that is fantastic."

Mr Osborne's enthusiasm for modernising the party is shared by his fellow MP and friend David Cameron. The two young MPs have been called the Brown and Blair of the Tory party, with both tipped as future leaders. But in politics, isn't a friendship of this kind inevitably tinged with rivalry? "We are good friends and he is, indeed, the godfather of my daughter," he says. "This is a curse heaped upon us that we are called the Blair and Brown [of the Tories]."

Yet perhaps the reference is not too far off the mark. Could there be a deal between the two men about which one would be Prime Minister and which one would be Chancellor of the Exchequer, and if so, who would emerge as the victor? He muses: "It is not a situation that is easy to envisage at this stage."

Mr Osborne is usually referred to as the "Brown" in the relationship. But might the metaphor be the wrong way round? His manner is resonant of the early Mr Blair and like the Prime Minister he is not too patrician a public school boy.

He laughs, noting that Granita (the restaurant where Mr Blair and Mr Brown are said to have struck their pact) "has closed".

Then he adds, perhaps revealingly at this stage in an election campaign: "We do not have to, like Blair and Brown, ditch every single thing we believe in to make our party electable."

The CV

Born: 23 May 1971 in London.

Education: St Paul's School, London, and Magdalen College, Oxford, where he read modern history. At Oxford he was joint editor of the university magazine, Isis. He was also a Dean Rusk scholar at Davidson College, North Carolina.

Family: Son of the fabrics and wallpaper businessman Sir Peter Osborne. He married Frances in 1998. They have two children.

Career:

1993: Freelance journalist.

1994-95: Worked in the Conservative research department and head of the political section.

1995-97: Special adviser at the Ministry of Agriculture, Fisheries and Food.

1997-2001: Political secretary to the Leader of the Opposition and secretary to the Shadow Cabinet. 2001: Elected MP for Tatton.

2003: Appointed a spokesman for economic affairs.

2004: Appointed shadow Chief Secretary to the Treasury.