There are some people who seem to think that the way you reduce the cost of living in this country is for the state to spend more and more taxpayers' money. It is as if somehow you measure the compassion of the government by the amount of other people's money it can spend.

2012 has been an extraordinary year for our country. We cheered our Queen to the rafters with the Jubilee, showed the world what we're made of by staging the most spectacular Olympic and Paralympic Games ever and - let's not forget - punched way above our weight in the medals table.

The EU must be able to act with the speed and flexibility of a network, not the cumbersome rigidity of a bloc.

We have the character of an island nation: independent, forthright, passionate in defence of our sovereignty. We can no more change this British sensibility than we can drain the English Channel. And because of this sensibility, we come to the European Union with a frame of mind that is more practical than emotional.

I am not a British isolationist. I don't just want a better deal for Britain. I want a better deal for Europe too.

There should be no "means of communication" which "we cannot read".

It is vital that we get these policies right as we take forward our plans to drive down the deficit and transform our economy.