From controversial reforms on health and education to Britain's lingering military presence in Iraq, the prime minister has his work cut out convincing not just the country at large, but his own party in particular.

And in the coming year, there is a new kid on the block -- David Cameron, the 39-year-old new leader of the main opposition Conservatives basking on an upswing in the polls thanks to his perceived zest and novelty and a sense of disillusion after eight and a half years of Blair.

"It is always going to be tough," Blair admitted just before Christmas.

"I am battling on all fronts, but I'm enjoying battling because I think we are doing the right thing, and then it's not such a problem."

However much he relishes the challenge though, at the front of everyone's mind is his promise to hand over the reins of power to his ambitious finance minister, Gordon Brown.

Blair has said he will not fight another election but exactly when he will go is unclear, and commentators say his authority is already slipping.

On the EU front, the prime minister can point to some successes during six months in the chair, which he passes to Austria on January 1.

Analysts highlight the launch of membership talks with Turkey and Croatia, reforms to the bloc's ageing sugar regime, new rules on the use of chemicals and police access to telephone and Internet data and of course the late-night budget deal at a fraught mid-December summit.

Still, despite European Commission chief Jose Manuel Barroso calling it an "excellent" presidency, it rather pales in comparison to his bold vision when he took the helm on July 1.

"I am a passionate pro-European," he told Euro-MPs in June, proclaiming a vision of a modernising Europe that would rediscover its ideals and vitality and re-enthuse the public -- not least in his eurosceptic homeland.

But, after 4,653 EU meetings under the British presidency, Blair was forced to scale back his ambitions when leaders met in Brussels earlier this month.

Having originally strongly ruled out any cut to Britain's cherished budget rebate, he agreed to axe 10.5 billion euros off what it would otherwise have received up to 2013.

In return, he won a promise that overall EU spending would be reviewed in the next few years -- but without any commitment to reforming the costly farm subsidies system which benefits France and the most.

"Six months after he called for a new approach in Europe, there is little sign of it," Conservative foreign affairs spokesman William Hague said.

A poll published just before Christmas showed 47 percent of Britons think the country has had no benefit from its EU membership. Only 37 percent take a more positive view.

At the same time, the budget wrangling and the sacrifices required from the bloc's newest and poorest members in order to secure an accord have tarnished his image among those who saw him as a liberal reformer.

Back home meanwhile, it is the domestic reform agenda which is landing him in trouble.

Blair wants to give more power to schools, a plan publicly opposed by his deputy, John Prescott, and which nearly 70 MPs in his ruling Labour Party are reportedly vowing to reject.

The government is also determined to push through pension reforms but that will cost money and political will. Around nine million British workers risk falling into poverty when they retire, and one proposal to ease the burden is to raise the retirement age by three years to 68 by 2050.

Britain's continued presence in Iraq continues to sow discord, although it may be possible for its troops to start withdrawing in late 2006.

Another tricky choice awaits Blair in summer, when he must decide whether Britain should build new nuclear power stations.

The prime minister is said to be in favour of nuclear power to help meet future energy needs, but again he is likely to meet stiff opposition from Labour rebels and environmentalists.