We have far more to offer the world, far more to take real pride in, than putty, brass and paint.

Almost a year ago I was invited to address the Newspaper Society at its annual lunch and, although I achieved a certain fresh notoriety for poking serious fun at political correctness in some of its most unacceptable guises, the main theme I was pursuing was somewhat obscured.

So I feel it needs repeating as it is axiomatic to the debate about Britain in the World - and, incidentally, to the way in which others outside Britain view us as a nation.

In common, I am sure, with many other people, I have sensed over recent years a mood of introspection throughout the country which has gradually translated into a loss of morale and, increasingly, of self-confidence.

Now I know very well, of course, how many people have gone through very difficult times in recent years. But it is not just that. For it is hardly surprising that our self-confidence as a nation is at a low ebb when we are subjected day after day to a widespread cynicism about so many aspects of our national life. There is a persistent current that flows along undermining the integrity and motives of individuals, organisations and institutions.

There is no doubt that foreigners too have sensed this national loss of confidence in what Britain stands for and, assuredly, must think we are crazy not to take far greater pride in the notable strengths of the British character and in the things we perform so remarkably well in this country.

Whilst there will always be areas where we can learn some useful hints from the ways other people do things, and adapt them to our own local requirements in the UK, there is no doubt that people abroad envy us greatly for the high standards we have achieved in many spheres of our national life.

Why else should foreigners want to send their people to this country to learn from our experience - an experience based on the highest possible standards? Why else should so many major international companies, from the United States of America, Japan, Germany, and elsewhere, want to invest so heavily in Britain or place their corporate headquarters here?

Of course there is always room for improvement and constructive self- criticism and, of course, there are always exceptions to the rules. But in the face of an approach to life which appears to seek only to denigrate, to decry, and to destroy, surely it is about time we took pride in the fact that we have so many valuable national assets.

There is, after all, every reason for us to have faith and self- confidence in ourselves and in our country, in the special and irreplaceable values of our society, and in what Britain contributes to today's world, and should contribute to tomorrow's.

What better symbolizes, ladies and gentlemen, all that is so special about Britain and its place in the world- and about the Commonwealth - than the heartwarming success of The Queen?s state visit last week to South Africa?

The question, inevitably, is whether this lack of national self-confidence matters overseas, as it does at home? Does it affect Britain?s role in the world? The answer is 'yes'- to both questions.

There was a time when Britain exerted her influence on the world by throwing her weight around: by means of a strategically placed gunboat, a battalion, or even a strongly worded Foreign Office telegram. Now we must do so by excellence and example. But to do that, we have first to believe in ourselves. Otherwise, as is increasingly the case, we shall sell ourselves short.

However much people in other countries may see in us and our institutions virtues and strengths which we often fail to recognise in ourselves, there is always the danger that their views will change and that the world will come to see us as we too often see ourselves.

The point, of course, is that unless we can start to project, and invest in, our strengths more positively, we shall end up squandering the wonderful assets we have, with grave consequences for our influence in the world outside, and for our own self- esteem.

There are, without a doubt, those who will say that Britain already does a lot to project her strengths beyond these shores. But I believe this is a dangerously complacent view to take, bearing in mind the emphasis other countries place upon the projection of their strengths.

It is a question of having a better sense of what we are good at, and of a determination to make the best use of our national assets in a balance and co-ordinated way, for the good of Britain and the world at large. For Britain should have an important role in helping to maintain civilised values in the world - what I would call the 'timeless element' in the overseas role of a truly civilised nation.

In this regard, I was intrigued recently to hear that when a group of young people were asked what mattered to them most in terms of Britain's foreign policy, they spoke first of what they described as a universal responsibility transcending narrow, national interests.

I think this probably applies most particularly in the way in which we deal with the 'new agenda' issues - those international problems which know no national frontiers, like the environment, AIDS, drugs, terrorism, economic development and the important debate over the globalisation of free trade.

Left to themselves, such problems will eventually have a catastrophic effect on us all - which is why they need a response that is moral, unselfish, statesmanlike and not, in certain cases, merely following the latest fashionable theory.

Britain is indeed a remarkable country, not least for the way in which it has given birth to a host of non-governmental organizations which provide an opportunity for the kind of unselfish, disinterested service that is so much a hallmark of the British character. I am thinking of the crucial services performed by such organisations as Oxfam, Save The Children, Wateraid and Actionaid - to name but a very few.

I meet the hard- pressed representatives of organisations like these all over the world, and it is heartening nowadays to witness a growing and effective partnership between Government agencies and departments, such as the Overseas Development Administration, and many non- governmental organisations.

Although it may be unfashionable to say so, I believe that one of the elements which makes this nation what it is depends, crucially, on those robust qualities in the British character - qualities developed over a long period of time, in peace and war - which have manifested themselves in unshakeable standards of public service, of military prowess, independence of thought, voluntary effort, of artistic and scientific endeavour and great good humour.

These qualities- the Shakespearean 'becoming graces' of the British character - have provided us with our greatest possessions. But we need to believe in them, and ourselves, with more confidence and pride in order to use them more effectively overseas.

For instance, we have in our English language and culture a unique global asset. Both manifest themselves in the invaluable work in the British Council, of which I am enormously proud to be Vice Patron and in whose offices last week I launched an important programme to promote and coordinate the worldwide teaching of English by British institutions over the next five years.

They manifest themselves in the BBC World Service which, for 61 years, has been renowned throughout the globe for the remarkable integrity and quality of its broadcasting; and in the world famous stature of the Royal Shakespeare Company, the Royal National Theatre, the Royal Opera and Ballet and in our great orchestras.

All these, individually and together, are a powerful and subtle cultural vehicle the world over for British influence. They bring respect for our artistic quality and creativity, and reinforce a more general appreciation in other countries of British excellence.

For me, they are the great capital ships of the British cultural fleet. They perform their roles brilliantly- you certainly won't get anything better - and they deserve our consistent confidence and support in order to maintain their morale. Cultural diplomacy works. It is enormously important to Britain and we must not undervalue the priceless asset it represents.

Then there is our undoubted expertise in financial services. The formidable influence of the City of London brings great benefits to Britain because its reputation is deeply rooted in our history, built up over centuries on foundations which, on the whole, have shown themselves able to withstand the jolts and tremors of financial life.

But in order to maintain that well earned reputation in an uncertain world, the foundations need to be checked every now and then to ensure they are of a high enough standard.

There is no doubt, ladies and gentlemen, that we have an outstanding talent for doing many more things supremely well in this country- and one of them is a talent for advising our competitors how to organise themselves in certain spheres somewhat better than we have done ourselves! It seems to me that we need to take our own advice a bit more- and believe in its longer term potential.

We have a huge asset in the fact that we are one of the most inventive nations on Earth , but I would suggest that we fail to capitalize adequately on our excellence in this field. The same could be said in regard to the world-wide reputation Britain has in the field of quality design. Our success in the global fashion industry is but one example.

The question I want to ask here is a simple one. Could we not capitalize on our excellence by promoting Britain more effectively overseas? And could we not do this by harnessing our many strengths - cultural, commercial and diplomatic - welding them into an imaginatively coordinated demonstration of the best of Britain, and all done with enormous panache and style?

Clearly, it would have to be based on careful targeting, but would there not be a chance of packing a more powerful British punch and making a substantial impact in the face of ever fiercer competition?

I know from my own travels that this can on occasion be done, as I found when I visited earlier this month a very successful British Week in Casablanca which brought together a powerful combination of the best of British craftsmanship, manufacturing and expertise. But I wonder whether we still have a way to go in meeting effectively the challenge offered by other countries?

No discussion of Britain's place in the world can possibly be complete without careful consideration of the immense skills displayed by our Armed Forces and the roles which may be allotted to them in the future.

I happen to think that Britain has a special contribution to make the challenges of the new disorder of the post-cold war world, and to help in the creation of a better and more orderly world. Our Armed Forces have particular expertise in this area, and a long and proven tradition of excellence and professionalism which is recognised and admired the world over.

Once again, that tradition is something which has to be nurtured to ensure the foundations are not weakened by short- term considerations or the dictates of the latest fashionable theory.

When I carry out Investitures on behalf of The Queen at Buckingham Palace, I am regularly reminded of the extent of the Armed Forces' contribution to Britain's reputation overseas. Only last week I gave a decoration to a young Major whose task had been to restore the electricity and water supply to the city of Sarajevo. He had worked night and day to make a difference to the lives of countless thousands of war weary citizens.

You can perhaps imagine the pride I feel when reading the citations that accompany these remarkable people who carry out such selfless tasks all over the world, and whose contribution adds lustre to the name of Britain.

I do not accept that we should be shy or reticent about this excellence, which we tend to take too much for granted. Whatever roles the Armed Forces are called upon to perform in the years ahead, there is no doubt in my mind that their high standards of professional training will enable them to adapt to any requirement.

They are truly one of this country's most versatile assets - but an asset that requires special support and understanding if we are to be able to go on using it to our, and the world's, great advantage.

The same is true of the long tradition of impartial and independent public service which underpins the Civil Service, our police forces, our firemen, the National Health service, and many others.

Here too, is a tradition firmly founded on the highest possible standards and a strong sense of duty which are envied the world over. For our public services work in Britain for everyone.

Unlike in many countries, no- one, even the poorest and the humblest among us, needs to 'know the right people' to ensure that the system works fairly for them. But it would be a tragedy if we allowed that strong spirit of selfless public service to wither away by neglect or denigration. The traditions built up over generations can easily be destroyed in the twinkling of an eye.

I know that this conference has examined, in various breakout sessions, a whole series of issues which are central to Britain's role in the world. Personally, I would very much hope to see this country playing as full a role as possible in the development of a more sustainable approach to the problems and challenges which confront the whole world.

I would dearly love to see Britain being in the forefront of the development of an increasingly integrated response to these challenges; to use her capacity for independent thinking to develop a more balanced alternative to the dictates of conventional economic wisdom so that we can lead the field into the next century.

I would also like to see Britain using her traditional assets- and here I am thinking of great strengths inherent in our Diplomatic Service (surely one of the best in the world), in our academic institutions and in their vast, residual knowledge of the world, and its great cultures and religions - in order to help act as a bridge between the world of Islam and the West.

I believe that this would be one of the most crucial roles Britain could play in the kind of world that is now being shaped in the aftermath of the cold war. It seems to me that many of Britain's historical connections and traditions - to say nothing of the vast body of experience we have in the Islamic communities who now form part of modern British society- could suit us to the role of bridge- builder and interpreter.

But this could not be done without a willingness on our part to learn from the world of Islam, and to balance our innate pragmatism with an acute awareness of the vital importance of the things of the Spirit, of the things that have no commercial value and which do not conform to the insatiable demands of cost- effectiveness and 'efficiency'.

Only through balancing these two elements in the human experience could we begin to hope that a true understanding could occur.

Having said all this I know, of course, that none of these things can be done for nothing. We have to invest in the things we are good at if we are to go on being good at them. That fact brings its own special problems. There are difficult judgements to be made when resources are in question. But the dividend can be substantial even for a comparatively modest outlay.

Above all, we must be prepared to take the long-term view and not expect an immediate, or easily calculable, return. The success of the British Know How Funds in the countries of Eastern Europe and the Former Soviet Union shows how much benefit and goodwill can be won at modest cost. But we also need, critically, the self-confidence, and the belief in the value of those assets, to use them wisely and to good effect.

Rudyard Kipling put rather well one of the points I have been trying to make in his poem, The Return, where he says:

'If England was what England seems, An' not the England of our dreams, But only putty, brass an' paint, 'Ow quick we'd drop 'er! But she ain't!

We have far more to offer the world, far more to take real pride in, than putty, brass and paint. If we denigrate the things in which we excel, if we disregard the humanity, the tolerance and fairness, the sense of justice, and of right and wrong, and the suspicion of ideology and dogma, which inform so much of what we do well, we are throwing away things of long and tested value to us as a society.

We must not lose those civilising qualities which have stood the test of time, and which we can contribute to the benefit of others, as well as ourselves.

It is only through a belief in those perennial qualities, and a willingness to recognise their enduring value in the continuing march of history by having the vision and courage to invest in them, that we shall restore a proper sense of our worth as a nation, and thus contribute to the creation of a saner, safer world for our children in the next century.