Philip Collins went from housing estate to Houses of Parliament. Now, as director of the Social Market Foundation, his interests include the future of the university. Karen Gold reports.

The hero of Philip Collins's first novel, The Men from the Boys , is called Adam. Born at the respectable end of a Manchester estate, he wins a scholarship to Bury Grammar School, goes to Cambridge and becomes a BBC researcher, before returning, disillusioned and disconsolate, to his northern roots. Collins, 35, grew up at the respectable end of a Manchester estate, won a scholarship to Bury Grammar School, worked as a BBC researcher and did a PhD at Cambridge before becoming director of the Social Market Foundation two years ago. So are he and Adam one and the same?

"Circumstantially, I'm the same as Adam. Mentally, I'm not the same," he says. "I'm more relaxed than Adam. He's socially mobile but he doesn't take to the upwardly mobile life. I never went back to Manchester and thought it was somehow more real and grounded. The truth is that in the first draft of the book, Adam was entirely me, but I wasn't interesting enough to sustain a character in fiction, so I had to find something more interesting to say."

Despite this self-deprecation, many people do find Collins's career quite interesting. After reading history at Birmingham University (Bury Grammar thought he wasn't Oxbridge material) and his stint at the BBC, he worked as a researcher for Frank Field MP and then opted for a political science PhD on utopias at St John's College, Cambridge.

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He captained the Cambridge University football team and wrote two comedy shows for the Edinburgh Fringe before abandoning academic life as "too solitary".

The City beckoned: he joined Flemings Bank as an investment strategist and was poached by various stockbrokers, ending up as head of UK equity market strategy at Dresdner Kleinwort Benson. He made enough money to buy a house in London and another on the Lancashire moors. And then he decided to go into politics.

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By this time it was the late 1990s, when the Social Market Foundation was still a Tory think-tank. Founded by SDP intellectuals in 1988 it had moved sharply right under the chairmanship of the historian Lord Skidelsky, whom Collins approached with a research project making the connection between increasing personal liberty by reducing state provision of public services. He would probably not package the idea in that form today, with the SMF repositioned as a Blairite think-tank, but in fact it is, he says, at the heart of what remain his own two key research interests: decentralisation - "the more responsibility you give to people actually doing things, the more responsive and highly motivated they will be" - and social mobility - "the relative likelihood of getting into social class I from social class V is the same as it was 100 years ago. One of the tests we have for a liberal society is whether people through the application of their own ability and effort can move through the social classes. So we are very interested in looking for policies that can contribute to that end."

These issues hardly echo Adam's guilt at the loss of his working-class solidarity. But they do resonate with new Labour - unsurprisingly, since Collins's spell as Parliamentary researcher coincided with the rise of the young Blairites, alongside whom he campaigned and played football. Many of them are now MPs - David Miliband, for example, recently promoted from the Downing Street policy unit to education minister.

With such immaculate connections it was almost inevitable that when SMF's council, under its new chair, Labour peer Lord Lipsey, realised that no one wanted research from a right-wing think-tank, they would appoint Collins director.

By that time, in May 2000, the foundation was in serious trouble, he says. "If you're not talking to government as a think-tank, you're no one really. We had dwindling resources, we were talking to an opposition that was going to be there for a very long time, and the whole thing just fell off a cliff."

Today it has largely climbed back up again. The SMF now publishes 12 pamphlets, two edited volumes and 20 short papers a year and hosts public meetings and conferences. Estelle Morris made her notorious "barge-pole" statement at a recent one. Its growing influence is demonstrated by its speakers - David Blunkett, Gordon Brown, David Willetts - and by the fact that businesses are prepared to subscribe ?5,000 a year to sit down to lunch with them.

Behind these public sessions are twice-weekly private ones, often more interesting, says Collins. "We can get people from government, MPs and civil servants, around the table under rules of non-attribution and they will have an argument. People are off the leash a bit; they can say, 'I appreciate the difficulty of doing this, but here's another thought.'

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Sometimes we get genuine progress in a way you rarely do in a set-piece question and answer."

And what do they talk about? In its new incarnation, the SMF is almost entirely concerned with public services: health, education, welfare, non-commercial broadcasting. It has set up a health commission in the aftermath of the Wanless report on the future of the National Health Service, and it has just finished a series, in conjunction with Universities UK, on the future of the university, looking at access, employability, research and teaching. "The great ghost at the banquet throughout that series was funding. We tried not to talk about it, but we didn't always succeed. But there was a fairly optimistic feeling coming out of the seminars that the sector, beleaguered as it is, manages to do an enormous number of things."

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What happens after talk and publication is the crucial next stage for the SMF, Collins says. "No matter how great an idea you have, if it is not going with the grain of government then you are looking at five years of arguing, or taking it to the opposition."

So the foundation's six researchers are looking for policy ideas that might appeal to ministers. "We are quite assiduous in scouring journals for interesting thoughts that we can often give a wider constituency to. Sometimes if we say something, it gets through in a way that, if it's not said by us, it doesn't."

In particular he would like the profile of family policy to rise, both within and beyond the SMF. When The Men from the Boys came out, he says, people expected it to be a political novel. In fact it is a paean to good parenting, not only Adam's but, implicitly, Collins's schoolteacher parents' too.

"I had friends grow up on the same estate as me, and lots of the people who grew up with us are in and out of prison, and we would ask, 'What's the difference between us and them?' And the key difference is that our parents made sure we did our homework and knew very clearly what was wrong and what wasn't."

Fitting in writing a second novel is increasingly difficult, he says. He has lost the aspiration he once had to be an MP but he hasn't yet had enough of politics.

"I'm slightly haunted by the idea that I always move on, that I'll never devote myself to something. My whole energy is devoted to putting off the choice between writing and politics. I shall let the market dictate what I do: it will choose, rather than me."

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The Men from the Boys is published in hardback by HarperCollins, ?14.99. The paperback is out in January, price ?6.99.