This year will show the best of Britain. The Olympics and the Diamond Jubilee, a nation proud of our past, but with our face to the future. A nation that treasures liberty, honours hard work and values fair play and fair chances. That is the character of our country: strong, confident, united.
And our character as a nation is being tested, because even in this year of celebration families are under pressure, worrying about paying their bills, about keeping their jobs, about the future.
The road to full recovery for our economy will be long, and it will be hard. Anybody who says there is a quick or easy way out is kidding themselves. So the Coalition Government is working hard to clean up after the financial storm of 2008. Sweeping up Labour's mess and keeping our economy safe.
At times like these, we must pull together. Not let ourselves be pulled apart. Pull together as one nation. A liberal nation because that is the spirit of Britain.
Some people think there is something slightly un-British about liberalism. But this country, our country, is the home of liberty. And we Liberal Democrats are heirs to the great, British liberal cause. I am proud that now, in this Coalition Government, Liberal Democrats are repairing Labour's industrial-scale destruction of liberty.
Reversing 28 days of detention without trial, destroying the DNA records of innocent people held by the state, ending the illiberal nonsense of ID cards.
British liberties restored by British liberals.
Before 2015, because of us there will be:
the first gay marriage - and an end to child detention
the first bank levy - an end to huge tax loopholes for the rich
the first elections to House of Lords - an end to Control Orders
the first coalition government in our lifetimes
and an end to the myth that Liberal Democrats can't govern.
We are governing to fix our economy. We are governing to fight for fairness. We are in government - and we are on your side.
So yes, these are hard times. But this will be a good year for a great nation. A good year for Britain.
But let me tell you, this will be a good year for British liberalism too.
Our biggest challenge is to rescue our economy. We need to sort out the financial mess Labour left us. But we need economic reform too. We need a new economy that serves not one square mile, but one nation. Not creative accounting, but creative industries. Not the City, but all our cities. Healing the divide between North and South. That's why our Regional Growth Fund - that Ian Wrigglesworth has helped to lead - is investing £2.4 billion. Creating more than 300 hundred thousand jobs in the areas that need them most.
And we will bring sanity and responsibility to our banking sector. That's why we've put up the bank levy. And why we are protecting high street banks from risky investments.
We will free our cities. That's why we are striking deals with our biggest cities:
Sheffield and Manchester
Liverpool and Leeds
Bristol and Birmingham
Nottingham and Newcastle
Giving all of these great cities new powers and new opportunities, to be the engines of growth again.
And we will rebalance power in the workplace. That's why I want us to build a 'John Lewis' economy, where workers have a real stake. Not capital versus labour, bosses versus workers but modern enterprises built on shared endeavour and shared profit.
An old liberal idea to build a new liberal economy.
And a sustainable economy, one that protects the environment. Tackling climate change, green jobs for the future, green apprenticeships and a Green Deal to cut energy bills.
Some say we have to choose between boosting growth and being green. What a load of rubbish. Going for growth means going green. The race is on to lead the world in clean energy. The new economic powerhouses - China, India, Brazil - are competing.
So the choice for the UK is simple: wake up, or end up playing catch up. Going green is not a luxury for the good times. It is the best road out of the bad times.
Our party is the green party of government. We have always been a green party. And let me tell you this: we always will be a green party because we need an economy fit for the future to pull us out of this economic downturn.
And in these hard times, we have to look out for each other. That's why I fought so hard for benefits to be increased fully in line with inflation. The biggest cash rise ever in the basic state pension because we promised to look after pensioners. And we will.
Benefits for the unemployed were protected, too. Not everyone agreed with me on this, if you believed some of the stories. You would think these benefits are unlimited handouts for so-called "scroungers''. But these are benefits for ordinary people. Many of them laid off through no fault of their own and who strive to get back into work.
Most people who claim Job Seekers Allowance are off benefits within three months. They don't all sit there waiting for the next welfare cheque. That is a dangerous myth, that dishonours those down on their luck.
A friend of mine recently shared his memories of his father becoming unemployed. His Dad signed on but every day, he set the alarm for the same time as he had done for his job. He got up, shaved, put on a shirt and tie and sat at the kitchen table, working to get a job. And my friend said: "I've never been more proud of my Dad".
So let's never forget. Unemployment benefits are benefits for people who fall on hard times and hard times are not the moment to slash them. But if you are on benefit, you owe it to the nation, to yourself, and to your family to strain every sinew to find a job. To get up every day, just like my friend's Dad at the kitchen table and work at finding a job.
That's why I am such strong supporter of the basic idea driving the Coalition's welfare reforms to make work pay, boost independence and give real help finding a job rather than leaving people stuck on the dole, enslaved by poverty.
That is why, in a few weeks time, I will be launching the new Youth Contract. A Liberal Democrat drive for youth jobs: 20,000 more apprenticeships, 160,000 new jobs and 250,000 work experience places. A £1 billion scheme to get every jobless youngster earning or learning, getting all our young people earning or learning.
Because no matter how hard things may be we will never, ever leave our young people behind.
That includes encouraging work experience. There's been some controversy about this policy but I make no apology for it because we are doing the right thing. Labour's benefit rules actually penalised unemployed youngsters for getting work experience. So thousands of them ended up on the sofa, glued to the TV, cut off from the world of work, wasting time and losing hope. Our policy means young people can get up and get on, keep their skills alive, keep up the habits of a working life and improve their chance of landing a job.
Because let me tell you this: there is nothing liberal about leaving our young people to waste away on the dole.
So: we all have a part to play, a duty to the nation, and this duty is greatest of all for those with the greatest means. Those with the broadest shoulders should carry the heaviest burden - that is basic justice, Liberal justice. But that is not how it feels today.
Too often, rather than paying their dues the wealthy pay their accountants to get them out of it. Avoiding tax, minimising the amount they have to contribute - that's the name of their game. Boasting about the latest wheeze for moving an asset here, a property there and a loophole everywhere. All to make the tax bill lower.
Let me tell you, few things make me angrier as the unemployed struggle to find work, as ordinary families struggle to make ends meet, as young people struggle to get on the housing ladder: the sight of the wealthiest scheming to keep their tax bill down to the bare minimum is frankly disgraceful. Multimillionaires avoiding tax by moving their money around.
So: we will call time on the tycoon tax dodgers and make sure everyone pays a fair level of tax. We've already raised capital gains tax, cut tax reliefs for the wealthiest, clamped down on tax avoidance at the top and we will go further because the Liberal Democrats have a crystal clear approach.
A philosophy of tax as old as our party, described by Mill, pursued by Gladstone, implemented by Lloyd George: tax wealth, not wages. That is why we will raise the income tax threshold to £10,000. A radical tax policy. Our tax policy.
From next month, 25 million people will have more money in their pocket and over a million low-paid workers will have stopped paying income tax altogether. Just think about that for a moment: a million more workers with no tax bill because of us, because of you.
That's what it means to be a Liberal Democrat: real tax cuts at a time of real need. But we have to do more. That is why the Budget in ten days time and must offer concrete help to hard-pressed, hard-working families: a big increase in the income tax threshold, further and faster towards £10,000.
Help we promised, help we must deliver in Government, today.
I want the Budget to show how we are anchoring this Government in the centre ground. Credible - but fair. The last Labour budgets led our nation to the economic precipice. Fantasy budgets issued by a party in denial - out of ideas - and abdicating responsibility.
This month's Coalition budget will show the determination of both parties in Government to repair the public finances. Keep our economy safe and help working families.
The last big tax-cutting budget was in 1988. Nigel Lawson cut billions from the tax bills of the highest-paid workers: a budget for the few, not for the many. But this year's Coalition Budget must be a budget for fairness - not an 80s Lawson budget but a modern liberal budget.
Because we need a tax system for a nation pulling together: not being pulled apart. More important now than ever, when the forces of division are so strong. In dark economic times, people can turn inwards, close their doors, look for scapegoats. Fear can breed resentment and division: divisions between north and south between the nations of the UK, between different races or religions, between rich and poor, between the generations. Britain has a proud record of diversity and tolerance but we cannot be complacent. When the economy weakens, prejudice can breed.
So let's fight it, in every corner of our nation.
We are bringing forward proposals for gay marriage, already provoking debate. Let me just say, if you are a young gay person, your freedom to love who you choose is a
fundamental right in a liberal society - and you will always have our support.
Let's also fight for liberalism in London where just one more Liberal Democrat member of the Assembly would ensure the BNP gets kicked off. What a great moment for British tolerance that would be.
Let's wipe away the ugly face of racism and reaction. I call on all Londoners - vote for Brian Paddick, vote Liberal Democrat and kick out the BNP bigots.
And let me also say a word or two about Scotland. I want the Scottish people to have much more power for over Scottish affairs. The Liberal Democrats are, after all, the party of home rule. But I also know that, as nations in a United Kingdom, we are better together than we would be apart: richer, safer and stronger
Alex Salmond wants to break up the nations of the United Kingdom. I want to keep them together. He says this is a time for division - I say it is a time for unity. He wants to split us apart - I want us to pull together.
It is our job, as liberals, to fight against the forces of division. Fight for our vision of an optimistic, open and tolerant nation: a nation confident enough to face outwards to the world. Arguing, as I will be, at the Rio+20 Summit for green growth to create jobs, engaging with emerging nations to drive free trade, supporting President Obama's drive, in Korea this year to keep nuclear material out of the hands of terrorists and becoming the first major economy to hit the UN's 0.7 per cent target for foreign aid.
Real help for the poorest in the world, promised by us and the Conservatives in opposition - delivered by us together in government. This is a time that demands a better politics. A politics of the national interest.
That's why I am proud of this Coalition Government. We have shown that two parties, two very different parties, can govern together. Never again will the political Luddites be able to say that coalitions don't work. Coalition is working, it is has been tested and it has passed the test.
Take NHS reform. Controversial, yes. Difficult, yes. But the value of coalition has been proven because this is a coalition Government. The health bill was stopped in its tracks and rewritten because this is a coalition Government. Competition will be the servant of health care, not the master because this is a coalition government.
This is a bill for patients not profits. It is not a Liberal Democrat health bill but it is a better bill because of the Liberal Democrats, a better bill because of you. A better bill because of Shirley Williams - Shirley: thank you.
So: I am proud of how Coalition is working but I am even more proud of us, of you. The Liberal Democrats are once again a truly national party of government. The only party of the centre ground, not of the left or right, of north or south, rich or poor but doing the right thing for the whole nation.
The other parties are bound and gagged by vested interests. We are not. The other parties are hemmed into certain parts of the country. Look at the electoral map: blue seats in the south, red ones in the north. Look at where the money comes from: trade unions on one side, City financiers on the other. That is why we can say today: the Liberal Democrats are the only true one nation party.
A one nation party of the radical centre, representing all regions and nations. Seeing not what divides us - but what unites us. Sound on the economy, passionate about fairness: doing the right thing and battling vested interests. Challenging the status quo
For this is the timeless liberal mission: taking on the establishment when it fails the people. A more urgent challenge today than for generations because the old establishment has failed.
The two square miles - the City and Westminster have failed. Failed the ordinary people of this country and must not be allowed to fail them again. Now that we're in Government, people might ask if we can still be the party that challenges the establishment. The answer to that is an emphatic yes.
I may be Deputy Prime Minister but let me tell you: I am as much of a radical as ever.
Jo Grimond decried the conservatives of all parties, those who he said showed a 'sentiment in favour of things as they are':
Things as they are means an economy for executives not ordinary workers
Things as they are means a bank system that bankrupts our economy
Things as they are means life chances being crushed by the fortunes of birth
Things as they are means a tax system that hurts ordinary working families
Things are they are means a House of Lords stuffed with machine politicians
Things as they are means political parties kow-towing to media moguls
Things as they are just won't do any more
And we are in politics to change them. We are the pioneers of British politics: our eyes on the horizon. By 2015, we will have done a lot but we will have plenty left to do.
Take education - a touchstone issue for this party. We will have changed the landscape by the end of this parliament, spending £2.5 billion a year on our pupil premium to strengthen our schools and create new opportunities for our children.
But that is just the beginning.
So I want our ambitions for education to be at the very heart of our manifesto in 2015. Education that delivers on the liberal promise: that every child can go as far as their talent will take them. That is what we Liberal Democrats will fight for.
So: 2015 is not the destination. 2015 is a staging post. This country will be a more liberal nation but we will just be beginning to tackle the deep problems that cramp the lives of our citizens and hobble our economy.
Because let me tell you this: in 2015 we won't be looking back, asking people to thank us for what we have done. We will be looking forwards and asking for their support for what we can do together in the future.
We won't have finished the job in 2015. We will just be getting started, just getting started on making this nation.
A more liberal Britain with every passing year: that's the prize.
Let's get out there and fight for it.