Charles Kennedy: We must exploit the opportunity presented to us

Labour's curtailed majority means they may adopt a more consensual approach

In Parliament today, the largest force of MPs in the liberal tradition for over 80 years will take their seats to hear Tony Blair set out his new legislative programme. The Liberal Democrats sit in opposition to a Labour party elected on a 36 per cent share of the vote, the lowest ever recorded for a Government with an outright majority. Even under the perverse first-past-the-post system, the Liberal Democrats have now established national three party politics in Britain.

So what will the new three party politics mean during the next parliament?

The Prime Minister has clearly been bruised during the campaign and his assailants grow ever noisier. Many of his backbenchers have been returned with very slim majorities. In over 100 seats, the Liberal Democrats are breathing down their necks.

As a result, Labour's third term will be very different. Without the massive majority Tony Blair enjoyed in his first eight years, his new MPs will be much more difficult to manage. Attempts to railroad controversial and badly drafted legislation through Parliament with the help of pliant loyalists will be more difficult.

In the last parliament, while both Labour and the Conservatives were split over issues such as the war in Iraq, tuition fees, draconian anti-terror legislation and identity cards, it was the Liberal Democrats who stood firm and united.

The Conservatives flip-flopped over the great issues of the day, seeking political advantage. They failed to recognise that political advantage comes from clearly setting out your principles and sticking to your guns. That was the Liberal Democrat approach and, as a result, we were able to influence the course of events and the quality of British law.

The Conservatives are now into a protracted leadership battle. Labour may not be far off the same divisive process. The Liberal Democrats are strongly placed to play a more powerful role in the next parliament. Labour's curtailed majority means they may have to adopt a more consensual approach - both within their own party and with opposition parties. This will make for a healthier, and more effective, House of Commons.

Government concessions in the dying days of the last parliament mean that new anti-terror legislation will be brought forward. The Liberal Democrats recognise that a primary role of government is to ensure the security of the nation and it is incumbent on opposition parties to approach such issues constructively. The Liberal Democrat approach will be just that - but it will also be rooted in principle.

We must preserve a sensible balance between security and civil liberty. It must be judges, not an over-mighty political executive, who decide whether someone is to be locked up. But we will be urging the Government to give the judiciary and the police the tools to make that task easier when it comes to terrorism: for example, allowing phone tap evidence to be admissible in court. We also want to close loopholes in the present legislation and would favour introducing a new offence of planning a terrorist act.

On compulsory identity cards, too, our opposition has been principled and implacable. Far from being a cure-all as the Government suggests, little evidence has been presented to support their claims. For too long, Labour has been trading on the politics of fear to pursue pet projects. This cannot continue.

So the challenge of the next parliament will be fascinating - not least, the long-term challenges of pensions and local government finance. Labour went into the election with little to say on these issues. By contrast, the Liberal Democrats set out clearly the fair and sustainable direction we believe the country should take.

It would also be clearly absurd for the Government to bring forward legislation to reform the voting system without any attempt to address the great unfairness in our electoral system. When the Prime Minister of the country resorts to spending the last week of his campaign exhorting tactical voting, surely even he now recognises that an electoral system designed for just two parties cannot much longer survive.

What nobody could have foreseen at the 2001 election is that Iraq would become the defining issue both of the Parliament and, probably, of Tony Blair's prime ministership. Equally, in this Parliament, the potential political challenges are likely to be the product of events rather than of manifesto promises.

Now that the Liberal Democrats have established three party politics in Westminster, we must capitalise on the opportunity that presents us. Almost a quarter of those who voted at the general election are relying on us. We will not let them down.