Question: How is Conservative foreign policy developing at the moment, and what are you spending most of your time working on?

William Hague: We have the policy commission which Dame Pauline Neville-Jones is heading, which is looking at the whole range of foreign policy and its connection with domestic policy. She's looking at international and national security coupled with the cohesion of our own society - and of course people will see how relevant that is after the recent alleged terror plot.

What I've been doing pending that report, which is due next year, is setting out certain themes that we will be pursuing through and beyond that report. Top of the list is nuclear proliferation, which I gave quite a long and widely unnoticed speech on recently.

I think this is rapidly coming up the agenda. People can see from Iran and North Korea how important this is becoming but the world is responding in a fire-fighting way. I think there's a great need for international agreement on changes to the nuclear proliferation regime, and it's time Britain was actively making the case for that.

It's very important if we're going to keep the moral high ground in the nuclear proliferation debate to show we're having new ideas about how to help countries that don't have nuclear weapons, and that we can give them something in return for not developing nuclear weapons.

I think it could need a multilateral agency to oversee that or a fresh agreement at the United Nations to really reinforce the point so countries can be confident that if they don't develop nuclear weapons they will be able to get the nuclear fuel necessary for peaceful nuclear proliferation from other countries, from the nuclear weapons states.

So there's a huge piece of work for this country to push forward on nuclear proliferation and I think it will be one of the dominant issues of the next 10 to 15 years.

We should be actively making the case on international platforms - G8 summits, UN summits. The British prime minister and the British foreign secretary should really be pushing that forward, and we'll regret it in a few years time if we haven't done so.

The second area we're taking forward is European policy. I think there's a big opportunity now the constitution has run into the sand and the euro is in effect off the agenda in Britain to make the case for a different sort of Europe.

We've always been the nay-sayers while Europe has pursued an integrationist agenda, and the debate in Britain has been about whether to go along with it or not. Well now the integrationist agenda is running out of steam and is being rejected by people on the continent and can't be reconciled in any case with a greatly expanded EU.

So there's a real chance here for the UK to put the case for a different model, for a more flexible Europe with overlapping structures and agreements among the countries of the EU around the core of a single market, rather than thinking every country always has to be in agreement. I think there will be a much readier audience in the future for that.

Hague on Europe

Question Built to Last says the party will not sign a constitution that would create a European super-state. Would the party accept a constitution that takes a less integrationist line?

William Hague: At the moment the only forms of constitution that are on the table are intended to take it that way so it's very difficult to see at the moment a European constitution that would be proposed by the majority of EU states that we would be happy to accept.

We hope in the future that will change but I think it will take some time. We're not opposed forever to a document that clarifies and codifies European treaties so far, which is what some people say that the constitution is all about, but it would have to be in a different environment in which subsidiarity really was being applied. It never has been applied despite the use of the word for more than a decade, and powers should be passed back to nation states in some areas, with a different model of the future of Europe.

We're no longer whistling in the wind about that. We've been accused in the past of putting forward a hopeless idea that wouldn't be accepted by other people but I think now there is a much readier market for these views on the continent. I think it makes it quite an exciting time for us in European politics.

Question: Are we ready for Bulgaria and Romania to join the EU?

William Hague: We're strongly in favour of the principle of Bulgarian and Romanian membership, but we do want to see all the questions or issues that the EU countries have raised first being satisfied. And indeed we want the EU to be open to the countries of the Balkans and Turkey in due course.

Question: Your speech at the 2001 party conference, ‘Let me take you to a foreign land', was a vision of Britain under Labour in 2005 – how much of it do you think came to pass?

William Hague: A lot of it didn't come to pass. I think both and I and Tony Blair got something wrong in 2001, we both thought he would have a really good chance of getting the country into the euro in the parliament that followed. That was why he wasn't talking about it and I was talking about it. And of course that speech, which was widely misunderstood, was about European regulation and the euro, not about immigration.

I don't know anybody in the House of Commons who wants to join the euro in the near future - that's very different from a few years ago. It's hard to imagine now what it was like in 1998 when those of us who opposed the euro were seen as a beleaguered, shrinking minority. That has now become the general consensus and indeed there are countries in the euro which are wondering about whether they ought to be in it. So I think we've won that argument. I think we've been vindicated.

Hague on the Middle East

Question: Is Iraq sliding into civil war?

William Hague: It could do, recent events are not encouraging. I think it could go either way is the honest truth. It could go to a civil war, it's not there yet. Clearly there's a huge amount of sectarian violence, I think that doesn't constitute a civil war but clearly it could go further in that direction. Equally it's possible it could start to tip the other way given that there is a democratic government with all major shades of opinion within the country and that Iraqi forces are steadily taking control of more and more areas. There is the hope it could go the other way.

I think to pull out our forces when it could go either way would be a mistake. I think the great mistakes that were made were in the failure to plan for the aftermath.

I think the more one learns about it the more this becomes clear - the lack of coordination  between military and civil authorities, the absence of any plan commensurate with the plans made for the Second World War that were made in meticulous detail before the invasion of Germany in 1944 for how everything would be administered.

And the absence of a suitable number of troops, I think, has been the monumental error in Iraq because the evidence is if the coalition forces had been able to show real control from the beginning then they would have won much more of the respect and support of the Iraqi populations than has been the case, and I think that's a very powerful lesson for the future.

Question: Would a Conservative government ever sanction pre-emptive action against Iran?

William Hague: We don't rule it out. We're not calling for it, and I must stress that we're not advocating it at the moment. We're not calling for it, our position is the same as I understand the government's is now - although there was some confusion when Jack Straw was still the foreign secretary because he took a different line - and the same as the American, French and German governments. We're fully behind the offer from the permanent five members of the United Nations security council plus Germany to offer the Iranians civil nuclear power, but we don't entirely rule out military action. We just think it is not entirely wise to rule anything out in these circumstances.

A lot more will transpire on this in the next two weeks because Iran is meant to respond to the proposals. It may be we want to put a great deal of pressure on Iran. It's very important, I think, that countries in this situation should be able to see the penalties as well as the benefits of what they might do. This is one of the ways in which the policy of Libya was changed very successfully.

If Iran doesn't respond positively in the next few weeks I think we have to move swiftly on to advocating serious sanctions which must include as a starting point a UN ban on the sale of military technology and nuclear technology to Iran. Unless we're prepared to do that I don't think they will think we're serious. So again I hope the British government will strongly and publicly support such measures if we come to that in the next few weeks.

Question: Do you think the prime minister is right to go to the Middle East this autumn?

William Hague: I think it's very important for western politicians to go to the Middle East. I've called in several articles for ministers to take much more high-level, proactive approach with the countries of the gulf and north Africa so on such a visit - and inevitably on such a visit Israel and Lebanon are high on the list - I hope countries like the United Arab Emirates, Qatar, Oman and Egypt will not be forgotten.

I think there needs to be a very serious upgrading of British diplomacy towards the moderate Arab countries of the Middle East. These are potentially our key allies in the years to come.

Not surprisingly I see this as the great danger area in foreign affairs over the next decade. I think we have to become - as the next government we hope - very, very knowledgeable about the Middle East.

I think that British diplomacy needs upgrading and that means we shouldn't just be having the prime minister's fundraiser as the envoy to the Middle East - the British foreign secretary should be the prime minister's personal envoy to the Middle East and should be very visible there.

Question: Should Margaret Beckett have spent more time in the Middle East during the recent crisis?

William Hague: She's only been in the job a few months and I don't want to criticise unfairly. While I was disappointed when I asked her at the end of May what discussions she had with her Gulf counterparts and the answer was no recent discussion – which meant there hadn't ever been any – nevertheless let's give her a chance.

But I really do think it's very important over the coming months for that high-level engagement to get going with the Middle East in general.

Question: Tony Blair seems to have worked effectively with both Democrats and Republicans in the US. Could the Conservatives build a relationship with the Democrats?

William Hague: When I went to Washington in February we restored good relations with the White House, but also started to develop relations with the Democrats too - at a fairly junior level to begin with but we will now be continuing that and we see it as quite important.

I think the relationship of the Conservatives with America has been too narrowly partisan in recent years. Republicans are our sister party and of course they will remain our sister party, we will always have our closest relations with them. But it's very important to know senior people in the Democratic Party, for them to understand our points of view, because we don't know which administration we'll be working with after the next general election. So we will be doing quite a lot of work on that over the next couple of years.

Hague on domestic politics

Question: What's the mood of the Conservative Party heading into the autumn conference?

William Hague: There's a generally reinvigorated mood in the party. I think the opening months of David Cameron's leadership have been very successful.

There's a really strong esprit de corps, if I can put it that way, which is true at the senior levels of the party where we all work together, I think, more happily and with a greater mutual respect than I've ever known while I've been at a senior level in the party.

I think this is reflected too thorough all levels of the party and when you look at some of the people trying to be candidates, young people getting involved for the first time, it's quite inspirational.

Question: Is that all down to David Cameron?

William Hague: I have no hesitation in saying as a former leader that in his all-round political skills he's much the best qualified of any of us who've been the leader recently to take the party back to power.

I think he's got the right strategy and so far has done the right things. Of course there's something else helping us too which is the longevity of the Labour government - their time is passing, people's disappointment with Labour is becoming very great - and there's a natural interest again in the opposition.