David Cameron: a Prime Minister in a hurry

On the day that David Cameron cut short his visit to Balmoral to oversee the British response to the crisis in Nairobi, he walked from his office into the Cabinet room – and was astounded by what he saw. Sir John Major, who seems to be enjoying being an ex-prime minister more than he did the job itself, was hosting a gathering of cricketing giants. Sir Garry Sobers, Mike Gatting, David Gower and other titans of the crease were mingling where the Coalition’s most senior ministers hold their meetings.

You never know who you are going to bump into in No 10. On one point, however, Cameron is more determined than ever: Ed Miliband is not going to get the chance to find out.

The Labour leader’s barnstorming performance in Brighton has visibly riled, provoked and energised the PM, as he prepares his own speech for this week’s Tory conference in Manchester. Surely he acknowledges the panache of his opponent’s delivery?

“Look, it was a great miracle of memory – he managed to memorise the entire 1983 Labour manifesto and recite it! That was going to be in my speech, but I’ve dropped that joke.”

Taking the measure of his Labour opponent, he perches on the edge of his armchair in the downstairs study. “I just think it’s a mistake. If we want to secure a recovery for all, if we want to build an 'opportunity Britain’, we’re not going to do that by bashing business with higher taxes. If we want to build more houses and give people the chance of home ownership, we’re not going to do it by confiscating land off people. I just think it’s a very backward-looking, very old-style prospectus. You’re sending a message: 'Come to Britain and we’ll tax you more.’ It’s nuts.”

Behind the scenes, plenty of senior Tories are concerned that Miliband’s “retail offer” of smaller utility bills and more housing – so-called “consumer socialism” – may resonate with voters less interested in economic doctrine than in their family’s appreciable standard of living. Cameron’s refrain is that the economic disease has to be cured: it is not enough to patch up the symptoms. But he acknowledges that “we can’t just be the people who say we’ll look under the bonnet of the car and fix it, we have to explain our values and our motivations”. The Conservatives must do more to make their strategy of “fiscal conservatism” and “monetary activism” voter-friendly.

“I think, first of all, we do have to do more to explain how we are going to help people with the cost of living. But we have to make the big argument, which is that, in the end, there is only one way you can improve people’s living standards – you have got to secure a recovering economy, secure good jobs, keep the deficit down so that interest rates and mortgage rates are low, and then you’ve got to cut people’s taxes.

“Now we are doing all of those things, and Labour would do none of those things – they’d borrow more so interest rates would go up, they are not committed to cutting people’s taxes, and they wouldn’t provide the jobs that we have through our flexible and competitive economy.

“On fuel bills specifically, I think we have to explain: Look, we want competitive fuel prices, not for 20 months [a reference to Miliband’s proposed price freeze], we want them for 20 years and what that means is you have got to make the market more competitive, you’ve got to access new sources of energy like unconventional gas, you’ve got to make sure that consumers are put on to the lowest tariffs. You’ve got to look at the causes of high bills rather than just simply say something about the fact of high bills, a policy it seems to me which actually unravelled within about 12 hours of it being announced. In the end, Labour’s problem is that no one trusts them to run the economy, and I think last week can’t have done them any good.”

That said, he wants to make clear in Manchester a sense of urgency – with the difference that, unlike Miliband, he is in a position to do, as well as to talk. Hence, he discloses to The Sunday Telegraph that the start date of George Osborne’s “Help to Buy” scheme, under which the Government will provide up to £12 billion of “guarantees” to encourage mortgage lenders to offer more generous loans, is to be brought forward from January 2014 to next week. Far from backing away from the controversial proposal, the PM and Chancellor are accelerating their plan.

“Right now, the mortgage market is still broken, young people who have got a decent job and have got decent earnings [still] cannot buy a house or a flat because they have to have a £30,000, £40,000, or £50,000 deposit. Now, if you haven’t got rich parents, you can’t get that sort of money, so the Help to Buy scheme is not coming in next year, it’s coming in next week, because I am passionate about helping people who want to own their own flat or home.”

By putting energy prices at the heart of the political debate, Miliband has raised a series of interconnected issues. Osborne is known to have been increasingly impressed by the former chancellor Lord Lawson’s more sceptical view of the orthodoxy on global warming – an orthodoxy reaffirmed last week by the Intergovernmental Panel on Climate Change. I ask Cameron if he, too, has shifted his ground on greenery.

“I’m certainly not more Lawsonian. It’s worth looking at what this report this week says – that [there is a] 95 per cent certainty that human activity is altering the climate. I think I said this almost 10 years ago: if someone came to you and said there is a 95 per cent chance that your house might burn down, even if you are in the 5 per cent that doesn’t agree with it, you still take out the insurance, just in case.”

The question, to stick with the PM’s metaphor, is how high a premium to pay for this security. Again, Osborne has signalled his concerns about green taxes and subsidies – a cause of serious friction with Clegg, who privately fears that the Tories were never truly committed to greenery. So Cameron chooses his words with care.

“What we’ve done in energy is try to make sure there is a balance of different technologies to give us a balanced energy supply. We do need some of these new renewable technologies and that’s why there are subsidies, but we shouldn’t have those for a second longer than they’re necessary.”

On wind farms – seen by many as an expensive blight on the countryside, subsidised by the taxpayer to burnish the image of politicians who live nowhere near them – the PM is equally diplomatic. “Recently, I opened the London Array, the biggest offshore wind farm anywhere in the world, and it’s good that Britain is leading the way in this technology. But as I say, you shouldn’t keep the subsidies for any longer than is necessary.” The young Tory leader who wore recycled trainers has come a long way.

The price of power, quite rightly, is to be held accountable. On immigration, Cameron accepts that “more needs to be done”. Does he regret the controversial “Go home or face arrest” vans? “No, not a bit, I don’t at all.”

On defence, however, he is touchy about some of the criticisms. “We still have the fourth-largest defence budget in the world, and the cut in the defence budget across a five-year parliament has been 8 per cent – so, of course, it’s difficult. The argument that I do find frustrating is the idea that with the fourth-largest defence budget in the world, spending £33 billion on defence, we don’t have hugely capable Armed Forces – we do. In fact, the changes we’ve made have made them more capable.

“If you look at the Army, go to Afghanistan now and ask our forces – as I always do, twice a year – ask them, is there any equipment you don’t have that you want? Five years ago the answer was 'yes’. Today they say they’ve got really the best equipment of any army in the world, including protective vehicles, better body armour, better munitions, and all the rest of it. We have a hugely capable Armed Forces and I get frustrated sometimes that people think that no change is an option – it isn’t. You’ve got to make sure they are properly equipped for the future. But anyway, I’m letting my frustrations out!”

Cameron’s tribal task in this, his eighth party conference as Conservative leader, is to heal the wounds of a year that was scarred by furious divisions over Europe, gay marriage and allegations that Lord Feldman referred to grass-root activists as “swivel-eyed loons”.

While contesting fiercely that Feldman ever said such a thing, Cameron acknowledges that the “tough decisions” of government have taken their toll on party unity: “That leads to arguments, it sometimes leads to intraparty problems, yes, that’s true.” Now, however, he sees a renewed “sense of purpose among the Conservative tribe”.

On the HS2 rail link – deeply controversial for many Conservative MPs and activists – he is absolutely not for turning. “First of all, we have got to build a new West Coast Main Line. It’s full. There are 4,000 people standing every morning when they come in to that London platform at Euston, there are 5,000 standing every morning when they get in to Birmingham. So here’s the choice: shall we build an old-style Victorian one, or what about building one of these new high-speed rail lines like every other sensible country in the world is building? The cost of high-speed versus conventional is 10 per cent extra. Is it worth spending 10 per cent extra to get a modern high-speed rail line? I think it is.

“Second point, and this absolutely goes to your readers’ concerns about whether too much is being spent. In the next parliament – and I’m going to say this slowly – between 2015 and 2020, we will be spending more than three times as much on other road and rail schemes as on High Speed 2, a new North-South railway line, as we should now call it.”

On gay marriage, he is now responding to those MPs who complained that he was more interested in legislation for same-sex union than in keeping his long-standing promise to recognise marriage in the tax system. “It has taken longer than I would like, because obviously we have been battling with all the economic problems in front of us, and we’ve been in a coalition.” Tactfully, he omits to mention that Osborne has always been lukewarm about tax breaks for married couples.

On Europe, the Tory party has taken a break from its decades-long self-mutilation, uniting, at least for now, around James Wharton’s Private Member’s Bill, which would give legal force to Cameron’s promise to hold a referendum on Britain’s membership of the EU by the end of 2017. But the truce is always under threat: Graham Brady, the chairman of the backbench 1922 Committee, has warned that the PM must flesh out his agenda for renegotiating Britain’s relationship with Brussels before the European elections in May. Some Tory backbenchers are also calling for a referendum before the general election.

“The thing is, this is a renegotiation and then a referendum – and we do need time to carry out that renegotiation. We need a Conservative government re-elected with the ability to then get in there and get the reforms to Europe and the reforms of Europe for Britain that we need. On setting out the position, I’ve already said some things – like we need to get out of this idea that Britain is committed to ever-closer union. We’re not. We want it to be more competitive, we want it to be more flexible, we want it to impose less cost on businesses and wealth-creation.”

On the question of Ukip, he is adamant that chasing their votes by heading off to the Right is not the answer. Indeed, what he sees as Miliband’s lurch to the Left is the real opportunity. “There must be quite a lot of people who believe in a free-market economy, who want a compassionate society, who support properly run public services, who used to have a home in Labour and don’t any more. I think it is a good time to say to those people, you can have a home in the Conservative Party.

“Yes, I want to win back voters from Ukip and I am the Prime Minister that offers an in/out referendum, who is reforming welfare, who is sorting out our immigration system, who is turning our economy round, who is backing aspiration. But let me be clear: I am also a Prime Minister who is a modern, compassionate Conservative, who believes that there is a very important role for government in making sure that we look after the poorest in our society.”

Almost eight years since he became Tory leader, and more than three since he took office, is Cameron happy? “I’m content that I’m doing a job that I am absolutely passionate about, I adore my family. I wish I saw more of them – but in terms of really believing passionately in what I’m doing and loving my wife and little ones – I’m happy.”

As much as Cameron admires Sir John Major, this is not a man planning to join the Ex-Prime Ministers Club any time soon.