The Conservatives will seek to reduce taxes, shrink the state and allow the nation to achieve the "British dream", Michael Howard has said.

Signalling that any future Tory administration will examine radical reform of the public sector, Howard said the belief that spending more would deliver better services had been "blown out of the water".

Setting out the origins of his personal philosophy, Howard went on to pledge a smaller state, where individuals are free to create wealth and pursue the "British dream".

And he also gave his endorsement to same-sex partnerships.

However, the Tory leader suffers a setback in a new Populus poll for the Times, which suggests that the Liberal Democrats and not the Conservatives have benefited from the Hutton report and that Labour retains a five-point lead.

According to the poll, support for the Liberal Democrats has jumped seven points to 25 per cent.  Labour are on 36 per cent and the Tories on 31 points.