Shadow Chancellor Michael Portillo yesterday turned twenty years conservative thinking on its head by stating that the goal of a Conservative government would be full employment.

In recognising the shockwaves that the statement would send through the party, Mr Portillo told his audience of economists from the Institute of Economic Affairs that the full employment policies of the fifties and sixties had followed from demand-side economic policy which was abandoned by the Thatcher government from 1979.

The Shadow Chancellor went on to explain in his speech that his definition of full employment meant the creation of the right economic conditions and circumstances which would permit and encourage full employment through the development of enterprise.

John Monks, general secretary of the TUC said, "It will be interesting to hear how Michael Portillo intends to do this and I hope it will not be at the expense of hard-fought workers' rights."