Ed Miliband has warned Labour that it will have to learn "hard lessons" about its past mistakes and accept that it will have to work hard to win back the trust of the British people.
In a stern message designed to show there is no complacency about the party's prospects in his tight-knit circle, Miliband told the Labour conference it could not count on Tory failure in order to win back power.
"My message to the public is this: we know waiting for the Tories to fail won't win us back your trust," he said in an echo of the mantra of Tory modernisers a decade ago. "And we won't deserve your trust if that's what we do."
Miliband reinforced his message by saying Labour would have to embark on an ambitious overhaul of its thinking if it is to respond to a "quiet crisis" in which the "hard-working majority" are being failed by society.
Citing the summer riots, the phone-hacking scandal and the banking crisis, the Labour leader spoke of "a something for nothing culture" in which people can "take what you can".
He added: "These are just the noisy scandals, which grab the front pages. But, you know, there's a quiet crisis which doesn't get the headlines.
"It's about the people who don't make a fuss, who don't hack phones, loot shops, fiddle their expenses or earn telephone number salaries at the banks. It's the grafters, the hard-working majority who do the right thing. It's a crisis which is happening in your town, your street and maybe even in your home."
Miliband underlined the scale of the ambitions Labour must embrace when he said the crisis dates back 30 years, indicating that it embraces the eras of Margaret Thatcher, Tony Blair and Gordon Brown.
"These crises point to something deep in our country – the failure of a system," he said. "A way of doing things. An old set of rules. An economy and a society too often rewarding not the right people with the right values, but the wrong people with the wrong values.
"So the task of leadership in this generation is no ordinary task. It is to chart a new course. And strike a new bargain in our country."
But Miliband made it clear that he was not planning to turn the clock back to the era before the crises, when he said that Labour had been wrong to oppose some of the main tenets of Thatcherism.
"Now there are hard lessons here for my party, which some won't like," he added. "Some of what happened in the 1980s was right. It was right to let people buy their council houses. It was right to cut tax rates of 60, 70, 80%.
"And it was right to change the rules on the closed shop, on strikes before ballots. These changes were right, and we were wrong to oppose it at the time. But while some of it was right, too much of what happened was based on the wrong values."
Miliband said New Labour had been right to moderate Thatcherism by rebuilding the public realm. But he said that New Labour, too, had embraced the wrong values.
"We changed the fabric of our country, but we did not do enough to change the values of our economy," he said.
"You believe rewards should be for hard work. But you've been told we have to tolerate the wealthiest taking what they can. And what's happened? Your living standards have been squeezed by runaway rewards at the top."
This approach had led to a "fast buck" economy in which vested interests are able to rip off consumers without being challenged, he said.
"In our economy, you've been told the fast buck is OK. And what's happened? We've ended up with a financial crisis and you've ended up footing the bill," he said.
"You believe in a society where everybody is responsible for their actions. But you've been told that if companies are big enough or powerful enough they can get away with anything. And what's happened? Big vested interests like the energy companies have gone unchallenged, while you're being ripped off."
While the main thrust of Miliband's speech was designed to outline a vision for the long term, he did not miss the opportunity to criticise the Tories' handling of the economy, criticising George Osborne for threatening economic growth by raising taxes and cutting spending more dramatically than in any other country.
With slow economic growth raising questions about the chancellor's plans to eliminate the structural deficit across the course of this parliament, Miliband attempted to portray Labour as the party that is most serious about stabilising the public finances.
"The next Labour government will still face tough decisions," he said. "We won't be able to reverse many of the cuts this government is making.
"And let me tell you, if this government fails to deal with the deficit in this parliament, we are determined to do so. It's why we will set new fiscal rules to bind government to a disciplined approach. And it's right, as a down payment, to tell you that we would use every penny of the sale of bank shares to pay down the debt."
Miliband, who acknowledges that his first speech as the Labour leader last year was overshadowed by the "soap opera" of his leadership battle with his brother, attempted to laugh off the family feud. He joked that his sons, Daniel and Sam, are "a new generation of Miliband brothers".
He said: "I know what you're thinking. But just to reassure you. We're really hoping they become doctors."
But he used his family history – his late father, Ralph, escaped from Nazi-occupied Belgium and his mother, Marion, was sheltered from the Nazis in Poland – to make a serious point about his values and mission.
"My parents fled the Nazis and came to Britain," he said. "They embraced its values. Outsiders, who built a life for us.
"So this is who I am. The heritage of the outsider. The vantage point of the insider. The guy who is determined to break the closed circles of Britain."
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