A Tory government would ensure Britain kept the pound and set its own interest rates, Shadow Chancellor Michael Portillo pledged yesterday.

He warned joining the single currency threatened to take Europe back to ''boom and bust'' and was the wrong policy for Britain.

In a rallying speech to conference, Mr Portillo insisted: ''At the election we will oppose the euro.

''British public opinion is suspicious of the euro as an unproven piece of political dogma. That is our view. That is the view of the moderate majority. We want to keep the pound,'' Mr Portillo declared.

Looking every bit a Prime Minister in waiting, the Shadow Chancellor gave a barnstorming performance to a packed conference hall.

The speech may have been thin on economics but it was thick on direction and drive, laced with wrath aimed not at the Chancellor, but on Prime Minister Tony Blair.

''He promised taxes wouldn't rise. But they have.

''He promised shorter waiting lists. But they're longer. He promised smaller classes. But they're larger. He promised more police. But there are fewer. He promised his government would be purer than pure. What a joke,'' Mr Portillo roared.

Compassion was the watch-word as Mr Portillo made humble reference to his own roots, his schooling, and his crushing defeat in the last election.

''It's four years since I could address a party conference from the platform,'' Mr Portillo said. ''A lot of water has flowed under the bridge.''

Mr Portillo used his period away from politics to ''connect with the Britain of today''.

''Now, as Shadow Chancellor, I cannot forget those experiences. My job is not just about dry economics. The quality of British life cannot be measured in material terms alone,'' he said.

''We are the party that understands how much the world has changed.''

The former hard-right Tory Defence Secretary was transformed into a caring-sharing Shadow Chancellor. Purged of any perception of greed of prejudice.

''We are for all Britons: black Britons, British Asians, white Britons.

Britain is a country of rich diversity,'' Mr Portillo said. ''We are for people whatever their sexual orientation. The Conservative Party isn't merely a party of tolerance: It's a party willing to accord every one of our citizens respect. We value people for what's inside them.''

Accusing Labour of ''smears'' against Tory policy of asylum Mr Portillo said the Conservative strategy would enable Britain to ''give a warm welcome to those who come to Britain in fear of their lives''.

''That's how my father came. Britain's willingness to take in refugees defines us as a generous and responsible people. It's a tradition that will be upheld by the Conservative Party.''

Mr Portillo spoke of the housing estates he had visited and the distress he had felt at the poverty of expectation and ambition.

He also told of a Saturday school organised by a black community in Sandwell, West Midlands, where parents were determined their children should have a better chance.

''Education would be the ladder by which they'd climb,'' he said. ''Many Labour politicians climbed that ladder. But now they want to kick it away from others. For reasons of pure dogma, they destroy good schools: grant-maintained schools and grammar schools.

''But they send their own children to exclusive schools. That's Labour's real policy on education. One rule for themselves, another rule for those they govern.

''William Hague went to a state school. So did Theresa May. So did I. No state school should ever feel second class.''

Turning to policies on welfare, pensions and the NHS, Mr Portillo promised a Tory Government would not shirk its responsibilities.

''Britain spends too little on health,'' he said. ''There's a consensus among the parties that we should spend much more money on the NHS. But not on how to spend it, nor on how that money can be supplemented.''

Mr Portillo said a Tory government would give doctors responsibility, and trust them to spend the money wisely, treating the sickest patients first.''

He promised new measures to cut red tape for business plans to make VAT simpler and fairer.

Criticising the Chancellor's ''stealth taxes'', Mr Portillo said: ''Labour thinks high taxes give them the moral high ground. They talk of social justice. They believe that money that government spends is always more worthwhile than money that people spend for themselves on their families.

''But I don't.''