Leading Article: What John never said

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"Party colleagues, friends, welcome to Birmingham for this meeting of our Central Council. It is 16 years since we embarked on this great adventure together, under the leadership of Margaret Thatcher. Slowly at first - and then more rapidly - we slew the dragons that hindered the nation's entry into the late 20th century. Hardly knowing ourselves what the outcome of our policies might be we accomplished mighty things.

We removed the immense drag of the nationalised industries and pioneered the success that is privatisation. We installed a tax regime free of the penalties that used to exist for personal success. Our steadfastness during the harsh days of the first recession imposed a discipline on British industry which has stood it in good stead, and we removed the threat of arbitrary and unjustified union action. Our revolution was necessary - without it Britain would have foundered. Frankly we deserve the country's thanks.

There were, of course, wrong moves and turnings that became cul-de-sacs. The over-emphasis on home ownership, coupled with the Lawson boom, led to a vast misdirection of funds into property and effectively subsidised the richest at the expense of everyone else. It has taken us a long, long time to get back on track.

Nevertheless the mission on which we embarked in 1979 has largely been achieved. Nor are we the only ones who recognise it. Whatever their rhetoric, you will not now find a serious opposition politician who believes that there is an alternative economic policy, who advocates increasing direct taxation for the majority, or who expects to bring any former utility back into public ownership. These are battles we have won for good.

Which brings me to my main point. The mission has changed. There are now new and different challenges facing the country. Our education system, despite all the legislation we have introduced, cannot deliver what parents want and society needs. Our reforms in the NHS, important in themselves, have not resolved the debate about health rationing. We have failed to make any headway at all on social security spending and the "dependency culture".

Perhaps more problematic than all this, however, is Britain's "crisis in legitimacy". The transformations of the past few years have put terrific strains on all our institutions, from the family to the monarchy. While the economy has modernised and diversified, our institutions have not. Our judicial process seems designed to line the pockets of lawyers rather than deliver justice, local democracy has all but collapsed and Parliament itself, with its bear garden atmosphere and tales of sleaze, scarcely seems the template for decision making in the modern world.

Faced with this, what are we, the Conservatives, to do? The truth is, I just don't know. There comes a time when virtually every option available to you seems to have been discussed and discarded only a few years before. I could pretend, I suppose, that the new policies that have been talked about this weekend add up to something substantial. They are the best we could come up with (I am particularly indebted to Douglas Hurd for dusting off some of the active citizen stuff from his Home Office days), but they are not good enough.

This is not a cheering message for you on the eve of the local elections. You know I'll do my best and remain cheerful till the last - no one will do any better. But, as the bard said, there is a tide in the affairs of man ... "

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