The Tories are upbeat, but must prove they really are a "government-in-waiting".

Tory Christmas shenanigans got under way this past week. A right-of-centre think tank attracted a young, glamorous Westminster crowd to a lively gathering at the Museum of Garden History (rakes and hoes aplenty). A well-known, popular BBC presenter excitedly asked groups of revellers: "Have you noticed? It's like 1995 again: everyone wanting to be involved with Blair's gang." He repeated his observation to a group of mannerly, twentysomething Tories. They smiled and nodded, even though 12 years ago they were sitting their GCSEs.

David Cameron gave a speech yards from where William Bligh, captain of HMS Bounty, is buried - although there was no mention of any mutinies. Talk was of a government out of control, the Tory blogger Iain Dale's new monthly print magazine (yet to receive a name) and the fact that "at least it's Ashcroft's signature on our cheques".

On Tuesday morning, Cameron held a front-bench briefing. The mood was upbeat, the message serious. He told his shadow cabinet that they and the party had to start looking and acting like a government-in-waiting. He wants them to project a more positive front, concentrating on stronger communities, stronger families and a greener, safer country.

It seems the meeting was effective. "We are beginning to feel a responsibility," says a frontbencher, "an understanding of how quickly the next two years will pass. If you had said at the end of the summer that we would seriously be talking about being in power, I would not have believed it." Now, however, "the government-in-waiting line hit home".

A shadow cabinet member reveals that "a no-swagger rule has been imposed". No matter how bright the future or how far down the plughole Gordon and his chums are, no one is allowed to adopt a cocky, dandyish strut. This will be harder for some than others.

With fewer than four weeks of 2007 left, Tory thoughts turn to 2008. Planning of policy announcements is under way and it's not just the big guns who will be making them. Many of the sharp, younger MPs have been let off the leash and are coming up with proposals for next year.

The shadow schools minister Nick Gibb and his team are keeping a steady stream of education initiatives coming. "Early next year, there will be a big focus on maths and science. Later on, there will be a big push concentrating on history and citizenship. We're concerned about the lack of historical knowledge pupils have." He warns that this will not be easy. "We are prepared to take on the education establishment, which has become a monoculture. Cameron understands this and knows it could be a difficult fight, but the current level of illiteracy is not acceptable."

Other inevitable areas include a debate on the Union, what the UK is going to look like in the 21st century and House of Lords reform. There are also areas that Conservatives would rather not talk about but will have to, such as university targets and the question of nuclear power.

Next big test

The May local elections are hugely important. "It's an obvious statement," says a strategist, "but we have to do well. If Labour is collapsing and we're ahead in the polls, the proof will be in votes won. It's paramount we don't muck anything up."

Already there are a few plans coming out that should prove helpful. The shadow housing minister, Grant Shapps, has come up with some forward-thinking - he dislikes the term "radical" - ideas that at first may seem quite un-Tory. He suggests that the party should try to dispel any nimby associations it may have by linking planning permission to the subsidy of popular projects such as hospitals, swimming pools or the regeneration of run-down town centres.

"Local people would be more amenable to central government pressure for a proposed 8,000 new homes if that would safeguard their hospital from closure, enable developers to build a new town centre and maybe even [allow them to] pay less council tax," he says. This is sure to rile the housing minister Yvette Cooper, who regularly accuses the Conservative Party of not wanting to build houses, and will be a vote-winner at local level. Just in time for May.

The shadow home secretary, David Davis, is drawing inspiration from Yuletide epiphanies. Expect proposals on counterterrorism, and a refining of this year's immigration policy. There will be police reform, con centrating predominantly on reducing police bureaucracy and - a modern, groovy one for the kids - e-crime!

A week facing the elements in east Yorkshire and dangling from the climbing wall he has in his barn at home always delivers Davis back to London honed and spoiling for a fight. Jacqui Smith has been warned.

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