'We must be bolder'

In what commentators described as a "watershed speech", Tony Blair set out a more radical programme of change.

Bouncing back from defeat in the vote over the Private Finance Initiative (PFI), Mr Blair, who was later joined in Blackpool by former American President Bill Clinton, earned a four-minute standing ovation.

His 54-minute speech was described by the general secretary of manufacturing union Amicus, Derek Simpson, as "ten out of ten for theory, but we look forward to the Government taking the practical test".

In a clear message of defiance to critics within Labour ranks, Mr Blair declared: "Now is the time to quicken the march of progress, not mark time. What started with the renewal of the Labour Party only ends with the renewal of Britain."

Although there were no new policy announcements, he set out his determination not only to solve the problems of health, education and crime in Britain, but to tackle world poverty and the environment.

He said he was determined to see through the reform of the public sector, while still holding true to Labour's core values of delivering quality services, free at the point of delivery.

"We are at our best when we are at our boldest", was his central theme - and an often repeated phrase.

The Prime Minister attacked the Tories and the Left for their "pessimism".

The audience loved it. Their applause drowned him out at several key points in his speech, not allowing him to reach the end of his sentence.

His key aim to push ahead with using the PFI to build new hospitals and schools was justified by his assertion that it was already starting to deliver.

"We said schools and hospitals first. We're building them. Lots of them.

"I am not going to go to parents and children and patients in my constituency, or any other, and say I'm sorry but because there is an argument going on about PFI, we're going to put these projects on hold."

To huge applause Mr Blair added: "They don't care who builds them - so long as they're built.

"So long as they're on cost, on budget, and helping to deliver a better NHS and better state schools for the people of Sedgefield and every other constituency in the land."

Mr Blair also backed a new wave of crackdowns on crime. Promising a new Criminal Justice and Sentencing Reform Bill, he said he would rebalance the system in favour of the victims of crime.

He stuck by his plan to fine or take benefit away from parents of truants who refused to co-operate, and to withdraw housing benefit from anti-social tenants and their landlords who abused it while "making life hell for the community".

* Mr Blair took a side-swipe at US President George Bush last night. At a meeting for northern delegates, he praised his guest, Mr Clinton, saying much of the world's present problems would have benefited from his touch.