Riding out a storm, but this speech will not change the political weather

Tony Blair delivered a speech of two halves. The first looked ahead to the domestic agenda for a third term. Wisely, there was no vague talk of boldness or proclamations that he did not have a reverse gear. Instead there were some substantial policy announcements.

Tony Blair delivered a speech of two halves. The first looked ahead to the domestic agenda for a third term. Wisely, there was no vague talk of boldness or proclamations that he did not have a reverse gear. Instead there were some substantial policy announcements.

The proposed expansion of Sure Start children's centres is a significant commitment. Sure Start has been one of the great successes of the second term, offering flexible child care and co-ordinated help for parents seeking work in poor areas. Mr Blair also hinted there would be radical measures aimed at pensioners. Moving to the younger voters, he promised to address the housing crisis - one of the great sleeping issues - by helping first-time homebuyers. In all, there were 10 specific policy commitments, listed formally one after the other.

Some of the commitments were not quite as meaty as they seemed. Mr Blair suggested improved pensions would be paid for from savings in incapacity benefit and the job-seekers' allowance. That will raise some cash but nowhere near enough to address the shortfall in pensions. It reminds me of similar claims before 1997 that the abolition of the assisted places scheme in schools would address the cash crisis in education.

The expansion of Sure Start will also be expensive. There is already an internal debate in the Government about how it will be financed. Mr Blair's ally, Stephen Byers, has urged publicly for co-payments to be introduced for Sure Start.

That strikes me as a feasible and sensible solution. Co-payments have been used extensively in other fields already, from entry fees for local authority swimming pools to tickets on nationalised British Rail trains. Even so, it would be a significant expansion and will generate controversy. Mr Blair chose not to mention co-payments as a possible source of funding in his speech. Similarly, the section of his speech on choice in public services raises awkward questions. He stated his aim was for "all patients to be able to choose their hospital, to book the time and date for treatment". In the next sentence, he pledged "Maximum waiting times down from 18 months to 18 weeks". But what if one local hospital proves highly popular to patients as they exercise their choice? Presumably the waiting list for the popular hospital will soar and therefore, on one level, the successful hospital will be deemed to be failing.

Still it was almost certainly a pre-election conference speech, not a moment for outlining the thorny problems relating to new policies. On that basis, his programme of policies provides the outlines for a progressive programme in the run-up to an election. It was not so much reminiscent of Margaret Thatcher at her pre-election conference in 1986, much studied in Downing Street as a model for renewing a tired government. There were closer echoes with Tony Blair in 1996 highlighting policies that pointed in a radical direction, while leaving out the more awkward details for another time.

The second half of the speech was much less convincing. He acknowledged the problem of trust related to his decisions over Iraq. At which point he left his candour behind and deployed an old tactic.

He erected a false dividing line, suggesting the debate over Iraq centred on those, like him, who believed that the nature of the terrorist threat had changed and those who did not. Yet nearly all of us accept that the threat changed dramatically after 11 September.

The real debate is over whether the war against Iraq made that threat even worse. Mr Blair proceeded to suggest that the other divide was over those who believe that the terrorists seek to liberate Iraq and those who do not. That was an astonishing claim. I know of no one that argues the terrorists are liberating Iraq. Does Mr Blair really believe this?

Unlike some of Mr Blair's conference speeches, I suspect this one will not greatly change the political weather. His political fate depends on events in Iraq, the performance of the main other political parties, not least in this Thursday's Hartlepool by-election, and the degree to which he can regain the political initiative if he wins a third term.