Here is the full text of Tony Blair's speech to the IPPR and Demos at Beveridge Hall, University of London:
There is a sense that in these days it is better for politicians to reject grand visions and great causes and go, as the Tories have done, for "minimalist politics", an offer so bare that its very paucity is supposed to give it credibility.
However, the big challenges facing the country - pension reform, child care, public health, increasing employment, to name just four - will not be met by minimalist politics but by bold and far-reaching reform rooted in the values of fairness and social justice.
The vision of a true opportunity society replacing the traditional welfare state can be realised only if we deepen the changes we have made to the country and have the courage to see them through.
The minimalist approach rests on not challenging the assumption that politics is boring, politicians all the same and all of us break our promises.
In fact, we should challenge it.
We should challenge the notion that Britain is a country in decline.
Its economy has just recorded a record number of quarters of uninterrupted economic growth.
We have two million more jobs and the highest employment levels ever.
Youth unemployment - a cancer of the 1980's - now virtually disappeared.
Britain is pouring investment into its public services.
Talk to a Head Teacher.
Visit your local hospital or GP premises.
See the computers in classrooms.
The extra hospital wings.
When Michael Howard told his story about visiting Brixton and finding no police, it took the Borough Commander and outraged residents to point out that numbers of police were at record levels and crime had fallen not risen in Brixton.
Britain is working.
After 1997 it did indeed get better.
And if anyone doubts that the policies we are pursuing across the board - from investment in the NHS to help for Africa - are different from what went before, just go back and study the Tory record.
Waiting lists up by 400,000.
Unemployment hitting three million.
Classrooms literally crumbling.
Aid falling as a percentage of GDP.
The reason we can and should "go big" in the vision we put forward is precisely because we can be proud of a solid record of achievement.
The reason for continuing, however, is that it is not enough.
The work is not complete.
Together we and the British people have achieved much in the past few years - a world of difference from the Tory years.
But there are still too many denied opportunity.
Too many hard-working families in difficulty and distress.
Too many of the elderly insecure and fearful of the future.
Until Britain is a land of opportunity for all, we cannot rest.
My argument, today, is as follows.
In my speech in Brighton, I described us as moving from the traditional welfare state to an opportunity society.
What I mean is this.
We have made real progress in Britain in the past 7 ½ years.
But the truth about the country is that for almost 30 years, social mobility has stayed relatively constant.
I want to see social mobility, as it did for the decades after the war, rising once again, a dominant feature of British life.
But to do that in today's world means more than relief from poverty and access to basic services.
It means creating genuine opportunity to make the most of your talent, and to access the best services, from whatever walk of life you come.
And, in my judgement, this can't be done within the existing structures of state and government.
In the first two terms, we have successfully made radical improvements to the existing 20th Century welfare state and public services; and we have begun to alter its structures.
But now, on the foundations of economic stability and record investment, the third term vision has to be to alter fundamentally the contract between citizen and state at the heart of that 20th Century settlement; to move from a welfare state that relieves poverty and provides basic services to one which offers high quality services and the opportunity for all to fulfil their potential to the full.
Just as we have moved from mass production in industry, we need to move from mass production in what the state does.
At the centre of the service or the structure has to be the individual.
They have both the right and responsibility to take the opportunities offered and to shape the outcome.
The role of government becomes to empower not dictate.
The nature of provision - public, private or voluntary sector - becomes less important than the delivery of the service the user wants.
In place of rigidity and uniformity, comes flexibility and adaptability.
And there need to be new and imaginative ways of funding some of the services that, though universal, must be funded on a sustainable, progressive basis.
All of this requires an inversion of the state/citizen relationship, with the citizen not at the bottom of the pyramid taking what is handed down; but at the top of it with power in their hands to get the service they want.
The implications are large.
It means deepening and following through the logic of the existing reforms in the NHS, schools and law and order; and taking a new approach to what I described in my speech in September as the seven new challenges the citizen faces in the modern world.
So far from retreating from New Labour, we need radically to extend its reach.
But first, some history.
There is no better place to make the case for an opportunity society than here in Beveridge Hall.
William Beveridge's fame is of course founded on his famous report of 1942; on the system of national insurance and public welfare assistance which it recommended, and which Attlee's government put in place alongside the National Health Service.
Labour's proudest 20th century boast as a party was that our 1945 government created the welfare state and did more than any other government of the century to attack poverty, promote equality and unify the country.
The values which animated those great reformers of the 1940s - Beveridge, Attlee, and Bevan - are our values: equity, solidarity, a society of mutual obligation; the condition of the poor and less advantaged, the test of humanity and decency for the nation at large.
Yet the institutions they created 60 years ago were rooted in social conditions and assumptions radically different to those of today.
It is this difference which is the starting point for my argument today.
I hardly need dwell on the contrast between today and the Britain in which my parents grew up in the 1930s and 1940s.
A Britain where whooping cough, diphtheria and measles were still major child killers; there were one million miners and only 70,000 university students; food was rationed, only one in seven households had a car, only one in five women worked; and life expectancy was 63 for men and 68 for women - it is now 76 for men and 81 for women, and is projected to rise by 2020 to 79 for men and 83 for women.
Beveridge and Attlee were constructing their welfare state for the conditions of the 1940s.
They conceived of welfare as a basic minimum, for citizens who queued for everything; who had little choice or variety in either the public or the private sectors; who had low aspirations beyond the basics; and who certainly grumbled but rarely complained, and even then in a spirit of deference and semi-apology.
It was on this basis, for example, that Beveridge recommended a flat-rate pension for all, regardless of need or previous earning; he even proposed that contributions be flat rate.
Early assumptions about the NHS proved similarly timeworn, notably the common view - which applied in the 1950s too - that demand on the NHS would steadily fall once many of the then-prevalent diseases had been eradicated.
However, Beveridge recognised more than most that institutions are images of their time; that each generation must create or recreate them anew.
This Senate House, a great modernist creation of its day, is a supreme testament.
Beveridge had a hand in its creation, and was adamant that 'it must not be a replica of the middle ages.
It should be something that could not have been built by any earlier generation than this ¿ a world of learning in a world of affairs.
Beveridge was in fact an educationalist first and foremost, Director of the London School of Economics for 18 years between the wars.
It is equally telling, therefore, that he should be remembered almost exclusively as a welfare reformer.
For in the 1940s and decades beyond it was welfare, together with the nationalisation of industry, which the mainstream left regarded as the main drivers of social equity and prosperity.
The 1945 Labour government has no education legacy beyond cautiously implementing the 1944 Butler Act.
Higher education remained the preserve of a tiny elite for decades longer.
And secondary education - even after the comprehensives were introduced in the 1960s - continued to be largely a low skill mass production preparation for low skill mass production jobs.
Economy and society were transformed in the decades after 1950.
Yet the institutions of the Attlee-Beveridge welfare state remained substantially intact - both their strengths, in the endurance of the progressive values which even Thatcherism proved unable to undermine, but also their growing inadequacy, where a failure to adapt to social change was exacerbated by deliberate neglect and lack of investment in the 1980s and '90s.
What we have done since 1997 is to halt this growing social division and start to turn it around.
It isn't just the jobs and investment I mentioned earlier.
Two million pensioners have been lifted out of acute hardship; 700,000 children out of poverty.
Tax credits have given many hard-working families a decent income for the first time in their lives.
When the Tories claim welfare spending has risen under this Government, this is a typical sleight of hand.
Spending on unemployment, on social and economic failure, has fallen not risen.
The spending that has increased - on pensions, on child benefit, on tax credits has been deliberate - to help people in need and in low paid work.
That is not spending we should cut; but spending we should be proud of.
And the spending in public services has often been on the very basics in the services we need: more nurses, doctors, teachers, police; and better facilities for them to work in.
Spending on school buildings is now seven times higher than in 1997.
Ten years ago half of the NHS estate was built before the NHS itself; it is now down to a quarter, with 100 new hospital building schemes in progress.
Training places for all major categories of public service professional have been radically expanded.
All of this has been necessary and has yielded real advances.
But there is something else we have learnt during Government.
The biggest advances have always been due to the boldest reforms.
Bank of England independence gave us the stability.
Insisting on the responsibility to work if you could, as well as the right to help, and merging Job Centre and Benefit Services, has further underpinned the New Deal's success.
Inpatient waiting lists - now down almost 300,000 since we took office, only have really started to fall systemically since the new independent Diagnostic and Treatment Centres were introduced and choice began; and as the Audit Commission recently reported, choice is most popular among the lowest socio economic groups.
Specialist schools - fiercely contested at first - have outperformed standard comprehensives.
In time, the student finance reforms already cited as an international model by the OECD, will be seen to have saved and enriched university opportunities.
Only when we really got tough on ASB, did the measures start to bite.
Asylum applications fell by 70 per cent only after a systematic overhaul of the system.
Up to then in each area incremental change within existing structures had improved things but not transformed them.
So the lesson is clear: press on with confidence; don't hang back in hesitation; point out the changes in Britain that really have made this country fairer and stronger; and use the experience of the first two terms to drive through lasting change in the third.
New Labour will, of course, remain under constant attack left and right.
Parts of the left still won't accept that the only reason we won two elections was precisely because we were New Labour, fighting in the centre ground, rejecting past dogmas and avoiding the mistakes of the 70's and 80's.
As for the Tories, they have looked at their polling and focus groups and decided to retreat to where they are most comfortable, beguiled by apparent support for hard right positions on issues like immigration and Europe.
This is an error, the full significance of which they will realise later.
Meanwhile, what it does is to give them a set of policies that are almost laughably inconsistent.
Hence their desire to conceal them behind "minimalist" pledges.
The Tory alternative will not be presented primarily as a policy alternative.
They dare not do that, because every time their major policies are exposed - particularly their ever-changing patients' and pupils' passports - they reveal themselves for what they are: policies to benefit a small minority of the better-off at the expense of the rest.
A patients passport only accessible by the better-off, subsidised by the rest.
A pupil's passport taking £1 billion out of state education to benefit a minority.
Most flagrant of all, their latest £2 billion proposed cut in inheritance tax, a subsidy mostly to the top 5 per cent of tax payers at the expense of the rest.
And in every area, sums which don't add up unless taxes rise or services for the great majority are cut even more than they currently indicate.
No, the Tories dare not fight the next election on policy - on what they would actually do in government.
But where the attacks from left and right will come together is this.
We will be under pressure to deliver higher expectations; but also under pressure on tax and spending.
The Chancellor has already rightly signalled that the next spending round will be tough.
The danger is that the left wants to deliver the higher expectations and loses sight of the tax and spending issue.
The right will opportunistically capitalise on the expectations, criticise the spending and hope to pin us between the two; to force a choice between support for our goals of social justice and the means of achieving them.
This is why the continuing reform programme is so crucial.
It is only by changing the system we will make it more effective.
The NHS isn't just a matter of money.
There are good and bad secondary schools with exactly the same funding and social intake.
The existing criminal law was never going to tackle ASB and won't tackle drug-related crime or organised crime.
If we take the new challenges, they won't be solved simply by spending more money within existing Government and state structures.
Taking all this together, we are engaged not on a set of discrete reforms, area by area, but a fundamental shift from a 20th century welfare state with services largely collective, uniform and passive, founded on low skills for the majority, to a 21st century opportunity society with services are personal, diverse and active, founded on high skills.
The purpose is however entirely traditional: social justice; to put middle-class aspirations in the hands of working class families and their children, to open up opportunity not for a few but for all.
Let me now say more about each aspect of this prospectus.
The five-year strategies on education, health, law and order and transport and published in July set out our forward plans in these areas.
In each area we will follow through hard in the directions of reform now established.
In health, we will open up the system further to meet demand from NHS patients and entrench choice.
We are planning a significant increase beyond that already announced, in the NHS's spending on independent providers of diagnostic and treatment services.
There will be a second wave of procurement worth £500 million, producing an extra 250,000 elective procedures a year.
Services such as diagnostics where there are continuing bottlenecks will be expanded by a mix of public and independent provision.
The result will be nearly 10 per cent of procedures being undertaken in the independent sector.
Choice will be extended until by 2008 it covers all elective procedures.
All of it, however, delivered within the NHS, free at the point of use and consistent with NHS values.
This essential new capacity will help meet our commitment that by 2008 every patient will be able to choose their hospital, with a maximum eighteen week wait between referral by a GP for specialist treatment to the start of that treatment.
In education, specialist schools will become near universal, and there will be 200 entirely new academies - free to parents, with no selection by ability - run by independent sponsors in areas where schools have been weak or failing in the past.
I will be happy to see these sponsored not just by individual entrepreneurs but also by companies: by churches and other faiths; and by the independent school sector.
200 is what we believe we can achieve.
But if we can do more, we will.
We will also promote a far stronger vocational pathway leading from school into apprenticeships and further education, so that the overwhelming majority of 16-18 year olds, not just those on a track to university, remain engaged in education or formal training and we make irrelevant the outdated concept of an education leaving age of 16.
Next week's Tomlinson report on
14-19 education will be an important further step forwards.
In law and order, we will bring back community policing through record police numbers and CSOs and street wardens and complete the reorganisation of the CJS, which is already seeing falls in ineffective trials, rises in fine enforcement and greater numbers of offenders brought to justice.
Equally important, however, are the new challenges we face to create a genuine opportunity society.
Last month I set them out in a speech.
I want to give some details of our approach today in key areas.
First, our employment record is excellent, but we should not rest until everyone who wants a job has a job.
Despite the changes we have made, for too many the welfare state is one which simply pays out benefits, trapping people into long term or even lifelong dependency.
We are piloting new approaches to reach out to those trapped on Incapacity Benefit to help them return to work.
We know that a million IB claimants say that they want to work - given the right help and support.
Early evidence published today shows that this works.
It is essential to bring the costs of the system down if we are to deal with rising costs in areas where we need to spend more.
Already, as a result of measures in the system the costs of IB are forecast to fall by £750 million.
As we come forward with further reforms to help people back to work, these costs will fall further.
We already have one of the best employment rates in the industrialised world.
But we should aspire to having the best.
On current figures this would mean an employment rate increased from the current 75% to around 80%, which would mean over 1.
5m more people in work - providing for themselves, their families, and of course their pensions and retirement.
This would be real full employment - closing the gap between the regions and ensuring that everyone who wants to work has the help, support and encouragement they need to get into work.
The second new challenge is lifelong learning.
Education in the future should not stop at 16 for anyone - and nor should the opportunities and provision on the part of the state.
I said at Brighton that we would put as much energy into vocational education as university education, and so we will.
Not only young people, but adults need skills to move into work or back to work, to progress in their jobs, and to retrain - at whatever age - to change jobs and careers.
Lifelong learning is not only central to our education policy, it is central to our employment policy, central to our economic policy, central to our policy for extending opportunity to all those out of work, and central even to our pensions policy as it enables more older people in their 50s and 60s to acquire the skills and opportunities to remain in work.
We have already greatly expanded apprenticeships, further education, and training to reduce the 7m adults without basic skills; and through the Employer Training Pilots we have pioneered new approaches to increase radically the amount of workplace training.
With leading retailers we have also launched the first of a new type of vocational academy led and managed by a leader from the industry.
In the coming months we will set out a comprehensive third term plan for adult skills, including proposals to alter radically the way skills and further education is provided.
The third new challenge is childcare and work/life balance.
In no respect has society changed more - and more for the better - than in the role of women and opportunities for them to work and lead fuller lives.
Most mothers now work full or part time and many dads would like to have a more time with their children.
For this to be possible we need to take the advances we have made in flexible working, in expanding childcare, and in nursery education and Sure Start, and make available comprehensive and flexible support to all parents of under-fives.
This is not just to help the parents: the evidence is very strong that good quality early years provision has a powerful impact on children's life-chances, particularly for the least advantaged and children with single parents.
Our third term commitment is to develop universal good quality affordable childcare for children aged 3-14 shaped around parents and children's needs.
This is not applying to everyone a standard state-run nursery system, but providing parents with a real choice between the public, private and voluntary sectors, including nurseries, playgroups, expanded provision in primary schools, children's centres and childminders.
This will also be a particular area for innovation in funding models: expansion of under-fives provision, beyond the existing right to part-time nursery places for three and four year olds, must be on the basis of a fair and sustainable allocation of costs.
Again, we will publish full proposals in the coming months, including new support for work/life balance for parents.
The fourth challenge is to help people provide for security in retirement.
The publication tomorrow of the initial report of the Pensions Commission, led by Adair Turner, will start a wide debate, and open the way for the commission to develop and consult on specific proposals over the next year.
There are two things I would like to say now.
Pensions, more than any other area, are for the long term.
Decisions made today will take decades to mature.
If people are to have security in retirement they must also have confidence in the system.
We cannot afford to have regular upheaval, and it is essential we move ahead by consensus so far as possible.
Moreover, reform needs to recognise that planning for retirement is not just about pensions.
It is about the balance between working and saving.
We need to give people more choice over how they plan for retirement.
We must change the culture that can write people off at 65 if not 60 or 55, whether they want to work or not.
Pension credit, and other improvements in pensioner incomes, now offer a decent income for all pensioners, far better then the position in 1997; and allows us to develop in the future a system which combines decent provision for those without savings with incentives for all in work to provide for themselves.
Already we have made a start.
Existing reforms are ensuring that millions for the first time are building up their own rights to a decent second pension.
We have already swept away many of the rules and regulations to give people more choice and flexibility over saving.
Now, those who choose to retire at 70 will receive a £120 pw basic state pension.
There is more to be done, and following the Turner Commission's final report we will set out proposals to address these issues systematically.
The fifth new challenge is public health.
Advances in medical technology hold the key to many diseases and illnesses.
Britain is at the forefront of these advances, and we are determined to continue being so, including in vital stem cell research.
But technology is not the only solution.
Many of these diseases result from life-style factors, such as smoking and obesity caused by unhealthy diets and lack of exercise.
Striking a balance between advancing public health, and not interfering unduly in lifestyle choices, is never easy; but there is general agreement that we could do more to tackle smoking and obesity in particular, promoting the health of teenagers as much as of older people.
We will address this in our forthcoming White Paper on public health, making it easier for people to make healthy choices about eating, living and working in smoke-free environments, and taking more exercise.
We will look carefully at measures that protect young children from pressures to make unhealthy choices - such as those from the excessive advertising of foods high in sugar, salt and fat.
Sixth challenge, law and order in a changing world.
This encompasses not just changes to the structure of the CJS described earlier.
It means also a wholly new infrastructure to protect our security - through ID cards and the electronic registration of all who enter our country.
Once established, this will reduce the costs of crime and illegal immigration and it is a classic example of the modern acceptance that a citizen has duties as well as rights.
In addition, I have become increasingly convinced that there is no long term solution to the most acute law and order problems without a different approach to drug and alcohol abuse.
I am in favour of tough measures to deal with both.
But the truth is that punishment alone will not work.
Thirty years ago, drug abuse was a low priority in tacking the wider problems of law and order and social responsibility.
Now it is central to both, and alcohol abuse is becoming a steadily bigger concern too.
300,000 children are growing up with one or both parents a drug addict; half of all crime is drug related.
The returns from drug treatment are often dramatic: an estimated £3 saved for every £1 invested.
Under this government the number of treatment places is up by more than 50,000 since we pledged to double treatment capacity in 1998; drug testing and treatment of offenders will be in place in all the 100 highest crime areas by the end of next year; we are doubling the amount we spend on every hard core addict and the new Serious Organised Crime Agency will tackle the drug trade as a top priority.
But I don't believe we are yet meeting the scale of the problem.
The challenge is immense to provide a whole new national infrastructure capable of tackling drugs effectively - the big traffickers, the small street dealers, the 280,000 regular users of heroin or crack cocaine, the high proportion of the prison and offending population which are addicts.
Seventh, pressures on housing mean that it is now a major barrier to opportunity, particularly for those trying to get into the housing market for the first time.
Our forthcoming housing strategy will show how we provide new pathways into home ownership as well as improving social housing.
In all the areas I have just highlighted we will be publishing substantial forward policy strategies in the months ahead.
Each of them, together with the four public service reform strategies we published in July will then form the basis of our third term manifesto, to be followed, should the people elect us, by a series of Reform Acts in each area to drive forward change.
So, there is a vast agenda of change to bring about.
All of it united by a recognition that the modern world demands new solutions to the new challenges.
All of it based on a belief that today people want the power to change their lives in their own hands, not those of an old-fashioned state and government.
All of it pervaded by a strong commitment to the values of social justice, equality and opportunity for all.
And all of it, in contrast to the Conservatives, placing progressive politics firmly in the centre ground.
I believe it is as compelling a vision, for Britain in 2004, as was that of Beveridge in 1942.
It is as relevant to the needs of the day; as progressive and radical in its means - and it will underpin the reforming passion of Labour in power for a third term.