HOW I'D RUN BRITAIN PLC; in This Rare Interview, the Brilliant Council House Boy Who Created the Tesco Phenomenon Gives His Views on Meddling Quangos, an NHS Overrun by Bureaucrats, Under-Performing Schools and, Oh Yes, Why He Wishes We Weren't Such a Coarse Society

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Byline: by Alex Brummer MAIL CITY EDITOR

SIR TERRY LEAHY never forgets his roots. He may be the greatest businessman of his generation, who catapulted Tesco from a lowly position as the 65th biggest company in Britain to the largest in the nation, but the values of family, hard work and community learned on a povertystricken Liverpool council estate are never far from his mind.

'I've always felt comfortable with ordinary shoppers, ordinary workers because that is my background. It's a strength, not a weakness,'

Thinking back to his own childhood, to his mother who was a nurse and his father who was crippled in the war and suffered from tuberculosis, he has no regrets.

'We were very poor, yes. But it was a successful community even though it was poor. The great institutions like the Church and the grammar schools reached into these council estates and gave you a way out. That was the really important thing,' Leahy says.

As chief executive of Tesco for more than a decade, Leahy has done his best to focus on building a High Street grocer into an international powerhouse -- and has kept his personal opinions about the state of Britain to himself.

Now, in his first interview since he said he was stepping down, he reveals those private views -- expressing his frustration with an education system that doesn't work, an NHS in which the bureaucrats have become more important than the doctors and a country where the quangos have grabbed power from the elected politicians. Leahy's past reticence on speaking out on the great issues facing Britain is all the more surprising given that his firm is the country's biggest private sector employer, with 490,000 staff on the payroll.

But today he says: 'There's been too much government and the state has tried to do too much.'

He also discusses his efforts and those of his wife Alison, an NHS hospital doctor, to lead greener lives in their own home.

Most of all, he regrets how British society has become coarsened. He wants a nation where 'people are taught values, taught how to work with people, taught how to be generous rather than selfish'.

Leahy is a modest, soberly dressed figure far removed from the celebrity lifestyle of other knighted retailers such as Sir Stuart Rose of Marks & Spencer and Sir Philip Green of Top-Shop. He is the last businessman in Britain one would expect to see tumbling bleary-eyed out of a Mayfair nightclub.

Bespectacled, of medium height with tightly cropped hair, he could easily be managing the local Tesco Express and passed in the street without a second glance.

In his decade at the top he has shunned publicity, mostly leaving financial presentations before the media to his senior colleagues. He commutes quietly between his ecofriendly home in St Albans and Tesco's industrial-like headquarters in Cheshunt, Hertfordshire. It is where he used to plot every next move for the mega-grocer -- like a master studying the chess board.

He has outperformed rivals like J Sainsbury by repeatedly being one step ahead of them -- in returning his stores from the outskirts of communities to the High Street, in conquering Eastern Europe and Asia, and by using the celebrated Clubcard as a marketing tool for all kinds of services, from banking to funerals.

Not that Tesco doesn't have its critics, who accuse the retail giant of concreting over the country and destroying the local shops that keep villages and communities together.

But Leahy takes on those critics head on. 'Over the years we have developed a format for every location. We have supermarkets for market towns. We have Tesco Express for villages, High Streets and council estates. All of these formats plug into a global supply chain that brings good quality, cheap food to millions of consumers. So nobody is disadvantaged.

'If we put an Express store into the community, people stay there, they don't go to the next town or the big supermarket for their shopping. …