Gordon Brown draws up his lines of battle - and highlights party fissures

Gordon Brown unveiled his personal blueprint for a fairer Britain and better world yesterday as he staked his claim to shape the strategy and policies for a third-term Labour government.

In a barnstorming speech to the Labour conference, the Chancellor called on Labour to build a national "progressive consensus" that went well beyond the party. But he issued a barely coded warning to Tony Blair and Alan Milburn, Labour's new policy and election co-ordinator, not to rush into more market-based reforms of public services that would divide the party.

Mr Brown pledged his full support to Mr Blair in the "difficult times" he faced over the hostage crisis in Iraq and the Prime Minister joined in the ecstatic response to the speech, shaking hands with his Chancellor in a show of unity.

But the speech failed to ease the tension between Mr Blair and Mr Brown over Labour's future direction. Pointedly, Mr Brown repeated his declaration a year ago that Labour was best when it stuck to its traditional values - a rejoinder to Mr Blair's statement that Labour was "best when at our boldest".

The Chancellor made clear he would not only control the purse strings for a third term Labour Government but much of the social policy too. He announced policies, including a 10-year plan for child care, a big increase in housebuilding, that would be unveiled in his pre-Budget report in November.

He also trailed new commitments on skills training; maintenance allowances to allow pupils to stay on in education; better pensions; extending the minimum wage for 16-year-olds; a drive to boost science and new firms to revive Britain's manufacturing industry. A review of the impact of globalisation on Britain will form part of the pre-Budget report.

In another challenge to Mr Blair, Mr Brown insisted that the economy must be central to Labour's general election campaign and, by implication, that he must be central to it even though his pivotal role at the 1997 and 2001 elections has been handed to Mr Milburn.

"With the economy central to people's concerns at this next election, that is the way to entrench and retain the trust of the people on the economy and to pay for the much needed reforms and investments in public services.

"Far from being trusted with the economy, this conference should be proud that Labour is today the only party trusted with the economy. But, for me, for us the Labour Party, and for the country, that is not enough.

"I want us to build a shared national purpose, a British progressive consensus, much more than a set of individual policies announced by politicians but a set of beliefs that come to be shared by the British people - that Britain can lead by example as the first country of the global age where prosperity and justice advance together.

"Our task, therefore, is not to consolidate the politics we inherited but by our words and deeds to transform people's view of what in our country is possible. To seek to win not just votes but hearts and minds to a shared national purpose - far beyond the ranks of our party or any party."

He said Labour must "learn the lessons" from the past. Even the great reforming governments that came into power in 1906 and 1945 lost their way on the economy, he said. So he would not abandon his prudent and stable policies.

In a coded warning that Mr Blair should not divide his party over further reforms, Mr Brown said: "The second lesson is that they failed to go out and deepen popular support for the next stage of their advance.

"And, instead of sustaining a progressive consensus in the country, they failed even to sustain a consensus among themselves.And so all of us must do whatever we can to ensure that we build the unity of purpose that this country needs by ensuring the strength of our unity of purpose in this party." In a sideswipe at the "choice" agenda favoured by Blairites, Mr Brown said: "I have seen this ethic of public service at work ... I have seen doctors and nurses who show not only exceptional skill and professionalism but extraordinary care and friendship ... There are values far beyond those of contracts, markets and exchange."

He argued that Britain could enjoy the best of both Europe and America as it built prosperity and justice for all. His "patriotic vision" meant "learning from but [being] different from America whom I admire for its enterprise but where - with 45 million without health insurance - great economic success is not matched by great social justice; learning from but different from the rest of Europe, which has greater social cohesion but where, with 19 million out of work, that social cohesion is not matched by economic dynamism."

He stressed repeatedly that Labour still had much to do and had not done enough. "In the year 2004, we still cannot be satisfied as long a poor child is still three times more likely to die before the age of one than someone born to privilege. We cannot relax when we know that the time from the cradle to the nursery school - the time that does most to determine life chances - is also the time when we offer mothers and fathers the least."

His vision was also a global one, suggesting that a progressive Britain could make a big difference to the world. "If we here in Britain cannot win the battle for an NHS free at the point of need, funded from taxation not charges, then what hope is there for Africa, where the poor cannot afford to pay for even the most basic health care and where the only hope of tackling disease, illness and Aids is a health service free to all based on need not ability to pay."

But he warned that the industrialised nations' goals for helping the Third World would not be achieved quickly enough.

With a rousing oratory, he brought the audience to its feet: "The promise of primary education for all will be delivered not in 2015, but 2130, 115 years too late; the promise for the halving of poverty not by 2015, but 2150, 135 years too late; and the promise of cutting infant deaths not by 2015 but by 2165, 150 years too late.

"And I say: 150 years is too long for a people to wait for justice; 150 years is too long to wait when infants are dying in Africa when there are medicines in the rest of the world to heal them; 150 years is too long to wait for promises to be redeemed and a bond of trust to be honoured; 150 years is too long to wait when all the world lacks is the will to act."

WHAT IS A PROGRESSIVE CONSENSUS?

Anthony King, political academic

"It is not clear. What he may have in mind is that the Government has succeeded in alienating large numbers of people ... who might be thought of as natural supporters, such as the Archbishop of Canterbury and Muslims. He may be implying that Labour ought to bring those people back into the big tent."

Ruth Lea, director at the Centre for Policy Studies

"I thought it was guff. Progressive consensus means nothing. What I felt it essentially meant was that if anyone disagrees with what they [the Labour Party] think is the consensus then they are not right. If you are with them, you are being progressive. So it is absolute cobblers."

Kate Beech, Labour member, Chichester, West Sussex

"I have been Labour all my life. I came out of Gordon Brown's speech thinking: 'Yes, that's fine, but why doesn't everybody get it?' I believe he was talking about moving forward as a country, with the people, to achieve what we want to achieve over the next five years."

Leonie Mathers, Labour member, Hucknall, Notts

"What I believe he meant... is bringing together everybody in making things better for everybody, building on our policies and taking them forward; we cannot leave people out ... Clearly Gordon Brown was also talking about pushing up standards in public services."

Roger Scruton, philosopher and writer

"The problem is that there is a conflict between the words. So if he has based his consensus on the progressive side, he is never going to reach it. Progressive is a buzz word that you have to use to show your left-wing credentials. Consensus puts him forward ... as someone who is not going to divide the nation."

Corin Redgrave, actor

"I would think it conveys a somewhat coded message for the arguments within the party and the direction it is taking. There are those within the Labour Party who are very concerned that it is taking an increasingly right-wing, reactionary direction ... It may well be that the phrase is not for our ears but for the ears within the conference."