Macmillan Lecture 2013: ‘Keep Calm and Carry On Reforming’

 MACMILLAN LECTURE 2013

Keep Calm and Carry On Reforming 

By Rt Hon Damian Green MP

The previous occasion I delivered the Macmillan Lecture was in 2005, just after a disastrous election result for the Conservative Party which saw us make little progress even though Tony Blair’s Government was visibly crumbling.

“Why aren’t we thinking what they’re thinking” was the rather gloomy title, prompted by the thought that the lack of progress made it much more difficult to obtain an overall majority in the subsequent election—a sadly prescient point. One thought I was keen to make then is equally true in the very different world of today; that if the Conservative Party does not like modern Britain it is unlikely that modern Britain will warm to the Conservative Party.

Of course there is much that needs to be changed, and much that is changing because of this Government. As I say in the title of this lecture, we must carry on reforming.  But we should not let the long recovery from recession, or individual horrible incidents such as the Woolwich killing, leave us gloomy or grumpy as a country. It is less than twelve months since the world admired the best Olympics of the modern age. They admired not just our national organisational skills but the character, warmth and openness of the British people. We should not just keep calm, we should cheer up.

I should move from the national to the party.  The same injunction applies.  

Perhaps this is the appropriate moment to fulfil the duty of all who deliver this lecture to quote Harold Macmillan; “It is the duty of Her Majesty’s Government neither to flap nor to falter.” Admirable advice which is both timeless and timely.  For centre-right politicians there are significant reasons to be both calm and cheerful , the most notable of which is the public’s reaction to the financial crisis and subsequent recession. It was the fond hope of those on the left, perhaps particularly those who grew up at the feet of Marxist philosophers, that this would be seen as a crisis of capitalism. The people would throw off the shackles of false consciousness and realise that free markets had failed, and that state spending, borrowing and control was the route out of recession.

Fortunately the British people have more sense than that, and tend to prefer the analysis that state spending and borrowing was precisely the route into recession. There is no spin in this analysis. Successive poll findings have shown  that even when Labour is enjoying a significant lead the Conservative team is markedly ahead on managing the economy. This is true even over the past few weeks, where calmness has not been the prevailing emotion.

The most recent Ipsos Mori poll showed a 14 percent lead for David Cameron on managing the economy. Truly, if it still is the economy, stupid, that sets the political tone we are winning the most important argument.  British Keynesianism failed in the 1970s, and enough people know that to ensure that its modern enthusiasts have little credibility. The world has not gone left since the crisis. Where right wing Governments have been ejected, as in France, the left-wing alternative is already in trouble. The economic facts of life are still Tory.

So keep calm. But also carry on reforming, and more particularly carry on reforming in a Tory way. There is gathering strength to the argument that the reforms we are seeing to, for example, immigration, welfare and education address exactly the issues that people want Government to concentrate on.

These key reforms have three significant features. The first is that they are as important to the success of the Government as the central economic policy. The second is that all of them are dependent on Conservative ideas and energy to drive them through. The third is that they are precisely on the Common Ground originally identified by Keith Joseph as the proper target for successful Government, rather than the centre ground.

So as well as winning the central economic argument we are reforming in the areas where the country needs changing, and we are doing so in a Conservative direction. This message cannot be sent too often or too loudly, particularly to traditional Conservative supporters. They want lower immigration, an end to abuse of the welfare state, and higher standards in schools. Conservative Ministers, drawing on Conservative principles and our Manifesto promises, are delivering this.  

On immigration, the latest figures show that net migration is down by more than a third since June 2010, and is now at its lowest level for a decade. At the same time as seeing this dramatic decline in overall numbers, which is the main requirement, we have continued to support economic growth by welcoming the brightest and best to the UK. Higher numbers of skilled worker visas were issued over the last year, as were university student visas. So we have lower immigration, and more selective immigration: both good Conservative policies.

On welfare, we have introduced the biggest welfare to work programme the UK has ever seen to get people back to work.  We also believe it must always pay to work – which is why we have capped benefits so that no one can get more on benefits than the average person earns in work. We want to help people escape poverty, not trap them in it. This reform is squarely in the tradition of  which Harold Macmillan would have approved.

The same is true with our education policy. We are making sure that every parent has the choice of a good local state school for their child, teachers have the powers they need to keep discipline in the classroom and the exam system is rigorous, respected and on a par with the world’s best.

We have a programme to improve the quality of teaching, including scholarships to attract the best graduates, higher literacy and numeracy requirements for trainee teachers and a network of ‘Teaching Schools’ across the country.  79 Free Schools and more than 2,000 new Academies have been delivered already. Many of them are in areas where most people have not been able, up to now, to gain access to an excellent education for their children. We are restoring discipline to the classroom with new search powers for teachers, an end to the ‘no-touch’ rule, and higher fines for truancy.

All of these essential reforms have been delivered by Conservatives working in a Coalition Government.

Which brings me to a theme which is particularly important for the Tory Reform Group, and all moderate Conservatives.  There may be areas of policy where we agree with Liberal Democrats, but we are not the same.  We believe in change and modernisation , and we recognise that what modernisation means changes over time, but we are first of all Conservatives. We have principles which are not shared even by the most orange of the Orange Bookers. We also do not regard ourselves in any way morally deficient compared to Liberal Democrats.

I get on very well with many of my LibDem Ministerial colleagues, but I am entitled to challenge their thesis that this Government can only be kept compassionate by their presence. There is a long and honourable tradition of decent Conservatives who want to help those who need help, and Macmillan himself was of course a prime example at all stages of his political career.

Macmillan  was alive to the difference. As he put it; “As usual the Liberals offer a mixture of sound and original ideas. Unfortunately none of the sound ideas is original and none of the original ideas is sound.”  We do have practical differences, as I discovered on a regular basis when I was Immigration Minister.

There are similar debates about key issues such as childcare. All of these debates can be, and are, resolved within Government, as they would be whether it was a Coalition or a one-party administration. But they illustrate that the moderate Conservative tradition is a vital part of any Conservative mix, and is distinctive from the instincts and habits that the LibDems bring to politics.

This distinction is key for those who worry that in the Coalition the tail is wagging the dog. We are reforming and we are reforming in a Conservative direction. Every Conservative policy is about promoting opportunity and social mobility.  We know that  making Britain succeed globally and allowing people to achieve their aspirations are the two keys to a successful society. Economic growth and individual growth need to go hand in hand. This is the basis for economic and social policy under this Government and I cannot understand why any Conservative, whichever tradition they adhere to, would object in principle to this approach.

There will always be disagreements about tactics and day-to-day priorities but these must not be allowed to divide the right, when the only beneficiaries will be the left. All  of us who campaigned so hard and so successfully to preserve a first-past-the-post electoral system must accept the consequences. Under first-past-the post a serious party that aspires to Government has to be a broad coalition.  This in turn requires a degree of self-discipline and capacity to compromise. If we Conservatives forget that, our opponents will be the beneficiaries.

This means that the tone of the discourse between Conservatives is important. If we sound as though we dislike each other, others will draw the obvious conclusion. I love Twitter, but its general tone should not be a guide to how Conservatives address each other. Disagreement on an issue, however emotive, does not mean treachery, or not being a proper Conservative. Politics is a team game, and mutual loyalty is vital for a successful team.

The biggest and longest-running cause of Conservative discord is Europe. Every Conservative should have a high regard for the lessons of history, and the party’s history on this issue since the 1990s is terrible. The effect of this has been, ironically and yet predictably, that Britain’s fate in Europe has been in the hands of those who have no sympathy at all for the Eurosceptic viewpoint. Surely we are all able to learn this lesson of history and not repeat it.

I am not just lecturing others. We must all learn lessons. For years pro-Europeans opposed the idea of a referendum. But the strategy of negotiating a new settlement, and then putting that to British people, is clearly the right one for current times. Most British people want it to happen. So much has changed since the 1975 vote that it is time to put the argument again. I hope and expect that the outcome of this process will be to renegotiate, reform, and revalidate Britain’s place in Europe. The Prime Minister has made clear that this plan will be central to Conservative policy up to and beyond the next election. It is time for the whole party to get behind it. And it is possible for those who hold the whole range of views on Europe to do so.

For those of us sympathetic to the European argument this is an opportunity to make our case, and the Prime Minister’s case, that a properly reformed EU will be hugely to Britain’s advantage. For too long only a few lonely voices in the Conservative Party have made the case that we are better off in. Those of us who hold that view cannot wait for the few weeks before a Referendum to argue our corner.  There is a hard-headed Conservative case for Britain’s membership of the EU, for all its imperfections, and it needs to be heard.

The core of the argument is economic. All sectors of industry agree that we are better off in. Let’s start with manufacturing. Five out of every six cars made in this country are exported, and 700,000 jobs depend on the industry.  How many of those firms would invest long-term in Britain outside the EU? No wonder Ford’s European Chief Executive, Stephen Oddell, has said that “Leaving a trading partner where 50% of your exports go… would be devastating for the UK economy.”  

Then there is the City, often seen as the part of the economy most hampered by EU rules. Goldman Sachs are unlikely to be sentimental about the economic effects of leaving, and they have concluded that departure would be a loss/loss scenario, in which the loss would be greater for the UK than the EU.  In particular they argue that “The UK’s ability to conduct business in financial services across the European Union is likely to be severely compromised by a departure from the EU.”

Then there is the argument that we should concentrate on the fast-growing economies in Asia and South America rather than sclerotic old Europe.  I have never understood how you make it easier to export to China by making it more difficult to export to Germany, and indeed the German example is surely one to follow. Last year Germany exported $804bn worth of goods to Europe, and another $519bn to the rest of the world. They are complementary markets, not alternatives.

Finally there is the argument that our businesses have to obey all these petty rules that hinder them. Does anyone imagine that the rules would be less onerous, or indeed less of a hindrance to British business, if they were made without any input from Britain? Since Britain will need to trade with Europe, we would be putting an added burden on our business, not removing one. And we would have to pay a large fee for access to the Single Market, as Norway does. The idea that we can remove all the irritations, but retain all the benefits, is not worthy even of the saloon bar.

Of course there is need for reform, not just for Britain’s sake but for Europe’s. We need a Transatlantic Free Trade deal. We need a single market in a number of new areas, including digital services. Above all, we need a reform deal which will deliver benefits to every country in the EU, so that others will be as keen as we are on reform.  This will show how beneficial it can be when Britain plays a leading role in Europe.

This European reform will be consistent with all the other hard-headed, unsentimental, pragmatic, Conservative reforms which the Government has embarked on. It will fit in with a wider modernising agenda which is nothing to do with party image and everything to do with making Britain (and Europe) fit to compete in the modern world. All these reforms, taken together, will change Britain for the better. So the job of all Conservatives at this point is neither to flap nor falter, but to get on with the job of persuading people that Conservative principles in action give all British people the chance to succeed. We should be proud of our record so far, and we know there is much more to come. We have an important job to do. We should devote all our energy and time to doing it. 

Only by calming down shall EU rebels get what they want, or have any colleagues left to share it

Nik Darlington 9.54am

Yesterday on these pages, Giles questioned whether the Tory party truly wants to resist the UKIP surge, or whether the Tory party in fact embraced it. This morning on ConHome, Paul Goodman questions whether Tory MPs even want to win the next election.

For some “lunatics”, to paraphrase Mr Soames commenting yesterday, this is not wide of the mark. The MP for Ketting, Philip Hollobone (majority 9,094), is insisting on parliamentary time to debate a referendum bill and “if it ends the coalition, so be it”.

That would, in all likelihood, end the Tory party’s tenure in office. It would not, in all likelihood, end Mr Hollobone’s tenure in the House of Commons.

There are however many hard-working, bright colleagues who would be sacrificed at the alter of Mr Hollobone’s (and others’) capricious whim.

To recap, John Baron (Basildon & Billericay: majority 12,398) posited a motion criticising the Queen’s Speech for not including an EU Referendum Bill. Coalition with the Liberal Democrats precludes this, however David Cameron has since announced the independent publication of a draft bill that is presumed will be taken on by the first name out of the hat for private members bills.

Mr Baron and supporters - including Peter Bone (Wellingborough: majority 11,787) and the reinstated Nadine Dorries (Mid Bedfordshire: majority 15,152) - have extracted this significant concession. Yet they press on. And on. Today’s Times (£) cartoon puts this best.

Has the Prime Minister handled this badly? Of course he has. Should a doomed stand be made against the muddled, undemocratic ranks of the Labour party, the Lib Dems, Greens and the rest? Yes, it should.

Europe is a salient issue for voters and the British people deserve a say on EU membership, pending the Prime Minister’s negotiations. For what it is worth, looking at the status quo, on balance I would vote to stay in; but it would be a close call.

It would not take much to convince me otherwise. The ‘out’ lobby has a war chest of momentum, funding and evidence. The ‘in’ lobby does not. In fact, I fear supporters of EU membership have at worst largely forgotten why they support it, and at best are relying on out-dated evidence.

Nevertheless, Europe is not the most salient issue for voters. It does not even come close. The crucial consideration in this sordid episode is that the Conservative party is being poisoned by myopia, desperation, and fears the wrong enemy.

Lance the boil. Have the debate about a referendum bill. Expose opposing parties. Be done with it.

Demonstrate to voters what this Conservative-led Government has achieved in the realms of welfare reform, schools and immigration; ram home the paucity of Labour’s alternative; press on with vital reforms to healthcare; and continue the hard but necessary work of rebuilding Britain’s economy.

Only by doing so shall the Conservative party have a hope of winning in 2015. Only be doing so shall there be a chance for an EU referendum. And only by doing so shall those MPs in safe seats who yearn for that referendum, have any colleagues left to ensure it.

Follow Nik on Twitter @NikDarlington

With railways, the many smaller reforms matter as much to this Government as the big projects

Matthew Plummer 10.49am

One of the reasons I was motivated to go out canvassing in the snow last weekend – not something I thought I’d be writing in late March – is the manner in which the Government has got stuck into overhauling the rail network. There’s been a lot of noise about the 50th anniversary of the Beeching Axe, which fell hardest under the Wilson Labour government. But what many of those nostalgic about the steam era haven’t realised is the extent of the work taking place on the railways today.

Of course, there are the high profile schemes – Crossrail and HS2 – both of which will address badly needed capacity shortages, as anyone travelling into Euston or on the Central Line during the rush hour will tell you. But there are other smaller projects that will bring dramatic improvements to local services, such as Manchester’s Ordsall Chord (which the Economist wrote up glowingly last week).

At the bottom end of the glamour spectrum, hundreds of platforms all around the country are being extended so that longer trains can be run – even the sleepy branch line down to my Dad’s place in the High Weald is having money spent on it. Stations are being reopened, while signalling is being modernised. And not a moment too soon: passenger use of the railways has doubled in the last two decades and continues to grow, despite the economic downturn.

Around the country, Conservative councils and MPs are lobbying central government for better railway services, and earlier this month Brighton’s Conservative MPs and councillors came out strongly for the innovative Brighton Mainline 2 scheme that will drive economic growth and transform travel across Sussex and Kent.

At a more fundamental level, we’ve taken action to bring the railways into the 21st century. Despite howls of protest from Labour, the Department for Transport has pressed on with reducing the number of ticket offices, which add to the already high overheads of running trains. Besides, when did you last actually buy a ticket over the counter? Most people purchase their tickets online or at ticket machines. Labour has consistently argued the union’s line that this is a precursor to closing railway lines, when the exact opposite is true – by bringing down operating costs we are putting our railways on a sounder footing and ensuring their long term viability.

The next election will see commuters look at their wallets and purses and ask what we’ve done for them. We’ve got a great story to tell motorists on freezing fuel duty, but railway season ticket costs have increased, albeit at a lower rate than was planned by Labour. Our action to keep these down is a good thing, given that the average commuter spends a fifth of their pre-tax salary on train travel.

So it is essential that we make sure the hard pressed commuter knows about our track record: we are an unashamedly pro-railways government that has balanced protecting people’s pockets with investing in the service they rely on every day.

Or in other words, we need to talk less about the exciting headline projects, and concentrate on telling the people who pour through London Bridge each weekday about the hundreds of small improvements we’re getting done to make sure they can get a seat on a train that’ll run on time.

Follow Matthew on Twitter @mwyp

If you’re in Eastleigh and you’re reading this, do something worthwhile and VOTE HUTCHINGS today

Craig Barrett 11.02am

Another Thursday, another by-election. Following the resignation in disgrace of Chris Huhne, voters are today going to the polls in a constituency that has been a tightly fought battleground between the Tories and the Lib Dems since the previous by-election, in 1994. A Lib Dem majority of fewer than 4,000 votes belies a seat where the Lib Dems have a very active party machine and hold all of the local council seats.

Needless to say, all parties in contention have thrown everything at it.  UKIP’s sole spokesman, Nigel Farage, declined to stand again in the seat which he fought in 1994, presumably thinking that he couldn’t win and to fail to win once again would be a humiliation too far.

The Labour party has John O’Farrell, former joke-writer for Gordon Brown, who has been roundly criticised for his comments lamenting the fact that the IRA failed to murder Lady Thatcher in Brighton in 1984.

The Lib Dems have selected a local councillor, Mike Thornton, who, in best Liberal Democrat tradition, has voted in favour of housing developments which his leaflets suggests he opposes.

Our candidate, Maria Hutchings, is a working mother with four kids, a genuine local campaigner whose campaign has been masterminded by the energetic, relentless, indomitable Michael Fabricant, whose endless stream of tweeted photographs shows the entire Parliamentary party (and their cousins and their aunts, not to mention their dogs) has visited the constituency to ensure that Maria’s message of being a local campaigner who can be trusted has been strongly made to every voter. I haven’t been down myself but my reading of her message is that she has sound Conservative views and will be a hard-worker for her constituents. The race appears to be too close to call.

My suspicion is that the biggest winner out of all of this will be SouthWest Trains.  Nevertheless, if you’re in Eastleigh and you are reading this, do something worthwhile today: VOTE HUTCHINGS.

Follow Craig on Twitter @mrsteeduk

Mansion Tax: a self-indulgence to make a point, not fix a problem

Nik Darlington 11.10am

In the 1920s and 1930s the sociologist Elton Mayo conducted a series of experiments to test the productivity of workers at the Hawthorne Works in Chicago. Later in the 1950s, Henry Landsberger interpreted the data to show how people change their behaviour when being studied closely. It is a crucially inherent human bias, called the ‘Hawthorne Effect’ after the location of its first monitoring.

Translate it to the public realm today and it can go some way to explaining why figures of public attention and certain significance embrace a stance on an issue purely for political effect. A psychological underpinning for ‘triangulation’ tactics, perhaps, to wrong-foot opponents; or simply self-indulgence, in the knowledge that one’s every utterance is being watched and measured by others.

Something like a mansion tax is such an indulgence. The only problems it solves are those embedded in its proponents’ own thinking.

True, there is a concerning malfunctioning of the free market in property in Britain. We live on a small archipelago, which as much as it might surprise cultural apologists is actually a very popular archipelago. Demand for scarce land and property is great, compounded by our little archipelago containing some of the most ravishing sylvan scenery known to man.

It is correct for any good Tory to question the proper functioning of free markets. Perhaps the most invidious Tory fallacy of recent decades has been the conflation of capitalism with free market libertarianism.

Yet let’s not chuck the proverbial cherub out with the bath water. Penalising the owners of expensive homes is not the proper way to correct property market imbalances. The unintended consequences of an arbitrary tax ceiling are well-explained by Toby Young here.

Furthermore, while it is true that the London property market is a bit berserk in parts, many marketplaces have their relatively crazy quirks. Should we whack a super tax on the salaries of footballers at Manchester United, because they collectively outweigh the wages of all players plying their trade in the lower leagues of Wales, Scotland and Northern Ireland? Actually, if anyone has proper stats on that, do let us know.

But of course not, that would be daft. What’s more, while we ought by default to dislike the coarse linguistics of ‘mansion tax’, who is the arbiter? This country house is a bit mansion-like; this dearer two-bed flat isn’t. The ‘problem’ of high property prices is not confined to London either. Even the good burghers of provincial towns like Cheltenham could fall prey to the punishments that shall befall ‘unearned’ wealth (again, who is the arbiter of whether wealth is ‘earned’?).

The the fact that good ‘working people’ might one day want to work so hard that the fruits of their labour reap a £2 million property is of no concern to proponents of a mansion tax; albeit such a purchase would most likely be weighed down by several years of mortgage debt and the onus to work on and on to pay it off. Moreover, the fact that someone, somewhere, is being hammered at approximately £80,000 a pop for owning an expensive home is little consolation to the person on an annual salary of one-quarter that figure (if you can identify a consolation, please say it).

The mansion tax’s introduction would be a policy of momentary significance and soon forgotten - relegated into the midst of myriad other taxes and conveniently forgotten by a succession of politicians drawn to the windfall begotten by negligent fiscal drag.

Ultimately, if the sole intention of a mansion tax is to send a message - and I cannot discern a practical fiscal rationale - it is philosophical navel gazing, not pragmatic policymaking. In other words, the type of approach followed by socialists supped on grand ideas and structural-theoretical solutions. Merely meaningless gesture politics.

Yet people can do funny things when they know other people are watching.

Follow Nik on Twitter @NikDarlington

We should all be unsettled by the reaction towards opponents of equal marriage

Nik Darlington 10.44am

Looking down the voting list from last night prompts some sadness. They are not what Downing Street might describe as ‘the usual suspects’. Neither are they the types deserving of the subsequent vitriol.

What is done, is done. There is a majority for this in the country; there is a majority for this in Parliament. To make this a partisan issue is as disappointing as it is dull. Move on.

Enough has been said on both sides of the debate about rights and wrongs. It shall do nobody any good to dredge over what are now old coals.

Instead, there are some brief observations to make about the reporting of last night’s historic parliamentary vote.

First of all, the nature of the ‘rebellion’. Broadcasters, broadsheets and tabloids are (unsurprisingly) focusing on the scale of Tory dissent, yet giving scant regard to the 22 Labour MPs who voted against, the 16 Labour MPs who abstained, the 4 Liberal Democrat MPs who voted against, and the 7 Liberal Democrats who abstained. Parliament’s vote as a whole reflects most national polling on the issue.

Though wrong to assume unthinkingly, it may well turn out to be the case that the Conservative party emerges from this difficult (and arguably ill-timed) culture war worse than it entered. So be it, one could say, for ultimately it was the right thing to do.

Nevertheless, should the Conservative party be scarred by this episode, that shall in no small part be thanks to the simultaneously superficial and spasmodic manner of its communication by the press.

Take various references across television and print to Tory MPs’ “failure” to back same-sex marriage. How is it itself a failure? I do not count myself among their number, but the many opponents of same-sex marriage (for whatever reason), not to mention opponents of this particular piece of legislation, would consider their vote a “success” rather than a “failure”.

Broadcasters - bound to impartiality by statute - ought to feel especially guilty about making such a partial editorial judgement. Indeed report that a multitude of MPs from all sides of the House of Commons “failed” to stop the Bill’s progression. That is a statement of pure and simple fact.

Yet do not presume yourself the arbiter of right or wrong. This has been a profoundly difficult situation for many people with variously strong religious, social and cultural beliefs. Nor presume to judge that those people have “failed”, have come up short, are somehow not quite as morally or intellectually vigorous as those in favour.

Time advances, opinions change, but not all at once. That is life; and there is no failure in that.

Follow Nik on Twitter @NikDarlington

Cameron’s EU referendum promise lays down the gauntlet to Labour

Nik Darlington 10.33am

“Mind your speech a little lest you should mar your fortunes.” David Cameron has followed the Bard’s advice to the letter. This has been the most mindful build-up to a prime ministerial speech in living memory. Are his fortunes intact?

First of all, I’m still keen on holding the EU referendum on the same day as the next General Election, something I’ve established on these pages before. Yet that is not going to happen now. By insisting it will be held before 2017 (which in practice means between 2015 and 2017), it does make a Tory victory more plausible.

Yet as Tim Montgomerie writes, it doesn’t “kill off” UKIP entirely. Surprisingly enough perhaps, UKIP’s voters don’t actually rank Europe as their greatest concern: immigration and crime, for instance, are more important. What today’s speech shall do though is present a stark choice to UKIP voters: do you want a referendum or not? If yes, vote Conservative.

Much of that depends on how the Labour party responds. Ed Miliband is stuck between a rock and a hard place. Support a referendum and he looks limp - following Mr Cameron’s lead and betraying Labour’s (admittedly not long held) Europhile principles. Oppose one and he looks undemocratic, betraying the will of the British people. It will be a difficult PMQs for him today, but then again, he’s had plenty of time to prepare for this moment. What is his answer going to be?

Staying with Labour and returning to UKIP, an interesting aspect here is that in certain parts of the country, many UKIP supporters are actually former Labour voters, not Tories. This reinforces how important Mr Miliband’s next step is. Reject a referendum and he possibly loses those voters forever.

There is a risk that the delay, potentially till 2017, creates an uncertain environment for British businesses. If you are an external investor reliant on untrammelled access to European markets, is Britain a safe bet? Mr Cameron’s explicit goal is to win an ‘in’ vote on significantly reconfigured terms - but terms that retain access to the European single market. Is that goal achievable? The tone of this morning’s speech will have reassured and mollified key European allies but there is no guarantee that the negotiation process - or this mooted new treaty - will get us what we want.

The Tory Reform Group has often been branded (from without) as a nest of Europhiles: “unpatriotic” (unfairly so) and “isolated” (these days, admittedly so). There is nothing inherently unpatriotic about wanting Britain to hold a strong hand of cards at the European top table, but as a pragmatist (and I speak for myself here not the TRG) one must recognise the realities of the world we live in.

Times have changed. Many in the TRG would, I wager, still call themselves pro-European; or more accurately, place other causes (such as public services, social policy, the environment, health, justice) far ahead of concerns about the EU.

I would also wager that no TRG member could disagree with the Prime Minister’s essential analysis today: the EU must become more competitive, powers must be held closer to those they affect; the democratic deficit must be closed; and the EU must shed its bureaucratic shackles to become leaner and more flexible.

Mr Cameron recalled the defining, founding ideals of European unity in postwar times. Awarding the EU a Nobel Peace Prize seems ridiculous in this age, but consider its beginnings and that prize is barely recognition enough.

Mr Cameron also recalled what makes the people of this little collection of islands different, and why we have often been seen as the “argumentative” member of the European family.

The past is the past; it can inform us but barely guide us. The European Union’s problem is that for too long it has looked to the future with more than one eye on the past. The world is different. The European Union needs to think differently, behave differently and function differently. That is more readily achievable, I believe, with Britain remaining strongly and critically involved. Not on the outside.

In party political terms, if the Labour party now promises a referendum (as it now surely must), the game is squared. In bigger terms, the best result for Britain would be a significant reforming of our relationship with the EU. And as Tim Montgomerie also writes this morning, perhaps it can allow sections of the Conservative party to let things rest for a while, and concentrate on the policies that voters genuinely do care about, like healthcare, schools, the cost of living and tax.

Things will change, positions will unravel and the realities of European negotiations will hit home hard. Yet for the moment, David Cameron has stolen the stage. Bien fait.

Follow Nik on Twitter @NikDarlington

Immigration, integration and Labour’s credibility crisis

Andrew Thorpe-Apps 1.48pm

In a recent speech in Tooting, Ed Miliband outlined plans to ensure that frontline staff in the state sector are able to speak ‘proficient’ English. It is part of achieving what he labelled a ‘connected nation’ rather than a ‘segregated one’.

“If we are going to build one nation, we need to start with everyone in Britain knowing how to speak English. We should expect that of people that come here. We will work together as a nation far more effectively when we can always talk together.”