The chairman of the Conservative Party seems remarkably chipper for a man the polls would liken to the captain on the last watch aboard the Titanic. When he succeeded Dr Brian Mawhinney, could Mr Ancram have imagined he and William Hague would be leading their troops into an election which might see Tony Blair returned with an even bigger majority?

Mr Ancram insists his position is much happier than the one his predecessor faced, because "we're not in government, not faced on the ground by the resentment and desire for change there was at the last election".

Then there is the evidence of "real elections" as opposed to the opinion polls. Victory in the European contest, "some of the best results we've had" in the London and local elections last year. Moreover, survey after survey suggests as many of 30 per cent of voters have yet to make up their minds. And what Mr Ancram calls Labour's "non-delivery-syndrome", the "let-down" factor among voters who held high expectations of Mr Blair's first term. Mr Ancram at least appears to believe there is still "all to play for". He would say that, of course.

Yet there is evidence that William Hague hasn't connected with the British people, hasn't come remotely close to persuading them he is a credible alternative prime minister-in-waiting.

Michael Ancram remembers campaigning in Scotland, "being met by people who said as long as Margaret Thatcher was our leader we would never win an election". They said she didn't have the necessary "qualities" - her voice and style were wrong. "But when it came to the election people took a different view, they looked for somebody who had conviction, commitment and a clear vision of what they wanted to see in society."

Then, he says, people measured Mrs Thatcher's vision "against the vacuum that was James Callaghan, who had no principles or beliefs". And he sees that situation being replicated now "because whatever you say about New Labour, and however hard Tony Blair tried to sell the third way, this government has never had a clear philosophy or, indeed, any clear set of principles. Most of the principles had to be abandoned in order to win the last election."

It isn't just a matter of the pro-Labour media. Respected Tory commentators, some of them admirers of the Tory leader, have been in public agony over the problem. And in blunt, brutal, terms it has on occasion been defined as, well, as Mr Hague's failure to convince people he is a fully-formed and rounded human being.

Mr Ancram observes "one of the luxuries of being a commentator" is that "when you're proved wrong you don't have to come back and say `sorry', you just move on to the next comment". After all, they said Mr Hague's message on Europe was wrong and he won the European election.

AS party chairman Mr Ancram says the word he gets on the ground, in street and market-place, is that the Tory message is coming over "much more clearly than at any time" in the last three years. And among the undecideds Mr Ancram claims "a significant shift" capable of surprising Mr Hague's opponent come polling day.

But surely he's getting another message? And it extends beyond Mr Hague. It's almost commonplace now, the observation that - if people line up Hague, Portillo and Widdecombe against Blair, Brown and Straw - they don't have a choice. Isn't the truth that people don't like the collective leadership image either?

Mr Ancram retorts that "the Blair magic" is beginning to rub off, that he is starting to be seen "for what has always been the case, that he is a man of image rather than substance, a man who's quite prepared to say things because he thinks they're to his advantage rather than because they're true."

He finds my listed threesome interesting: "You raised Brown, who is probably best known for producing budgets that sound good at the time but invariably turn out a week later to have promised exactly the opposite of what he's said they're doing." Jack Straw: "A man who accused Mr Mandelson of telling an untruth and, since Mr Mandelson has apparently been cleared of that, has been totally silent on the issue." And Mr Blair again: "Now increasingly seen as very good at the act but not very good at the delivery."

Beyond the personalities, of course, there is also a feeling that some of the Tory Party's policies are not very nice either. For example, when Ann Widdecombe, the shadow home secretary, talks about locking up asylum-seekers in secure camps. Fairly or unfairly, people think this is the Tories playing the race card. He recalls the party's last time in opposition when Mrs Thatcher, pursuing the Tory leadership, famously said people feared being "swamped". Aren't there uncomfortable echoes here?

Mr Ancram is emphatic: "We believe in creating a safe haven for genuine asylum-seekers but not a soft touch for anybody who wants to come here for economic reasons."

He cites popular support on this issue, a public inability to understand why, if people are in need of asylum, they can land in Italy or France but determine that they want to go on to Britain. And he notes that when Conservatives talked last year about "bogus" asylum-seekers "everybody threw their hands in the air in horror" while the same language previously used by Labour ministers "didn't count for anything".

The Liberal Democrats, in fairness, have been equally scathing of both major parties for their seeming contest on this issue. But isn't the very determination of economic migrants to come testament to Britain? And shouldn't a Tory party welcome the contribution they could make to British society?

Mr Ancram replies: "If that is an argument that's going to be made by people it should be made in terms of economic immigration, not in terms of asylum-seeking. What we are saying is we have a system of asylum that has to be fairly applied, and I make no apology for using language which actually tells things as they are. I find it an extraordinarily disturbing element of modern politics that there is a Big Brother censorship called political correctness which means we can't actually tell people in the country what is happening to them."

Even some Tories appear afflicted by political correctness. Michael Portillo was reportedly unhappy with Mr Hague's intention to make asylum a big election issue - as he was apparently about his leader's Britain as a "foreign land" speech.

The chairman says the shadow chancellor has never said anything about that to him, "and it's not something I know about". The point of the foreign land speech was to set out Mr Hague's belief that Britain "would not be what we know today to be Britain" after another four years of Labour government.

If Britain joined the euro the pound coins would be disposed of: "He said they would be melted down and that was probably a genuine description of what would happen." Mr Hague said taxes would be set from Brussels: "I know that your paper has been wrestling with the problems of Brussels trying to tell the Irish Government what taxes they should set, so that's not exactly a wild prediction."

Does he really believe a second Blair term equals the end of the United Kingdom as we have known it?

"What I do know is that if we were to go down the road of Blair's European superpower . . . that superpower would not be consistent with the United Kingdom as we know it today, because part of that vision is our membership of the single currency which, as we know, requires certain economic levers to be given up and handed over to Brussels," says Mr Ancram.

`WHAT William is saying to people is `do not believe you can vote Labour and that nothing will change, and that in four years' time if you don't like what's happened you can change your mind and have another go.' Because things will have happened which will be irrevocable . . ."

So does victory for Labour mean the battle for sterling is already lost?

Mr Ancram is convinced Mr Blair wants to get through the election without Europe becoming an issue and then "by hook or by crook he will get us into the single currency before the next election."

Mr Blair has indicated a two year period for decision. While naturally Mr Ancram won't concede the election - suppose Mr Blair wins big. How quickly does the Tory chairman expect him to move? "I think he'll go the moment he thinks he can manoeuvre a referendum into a winning position for himself."

Mr Ancram appears to know his enemy well.