As Prime Minister, Tony Blair spoke little about his faith, believing that religion in Britain is a private matter that does not sit comfortably with public life. But he made no secret of his Christianity and acknowledged, in office and afterwards, the enormous help and sustenance he received from his religious beliefs. His decision to set up a Faith Foundation to encourage interfaith dialogue and rescue religion from extremism is therefore particularly welcome: not only does it draw on his deep personal convictions and long political experience, but also it comes at a time when faith plays an ever more central part in politics and policy. Rarely have faith issues intruded as forcefully into Britain's largely secular society, or religious extremism been as critical to fanning and prolonging conflicts around the world.

In outlining his hopes for this new forum to The Times, Mr Blair has focused on two key challenges: the reconciliation of faith with modernity; and the interfaith dialogue between the world's main religions. Already, this dialogue is gathering pace: not only are academic and church bodies playing an ever more visible role in current debates on multiculturalism, extremism, identity and Britishness, but also in the wider world there have been potentially momentous initiatives to end historic schisms and enmities - the Vatican's overtures to Eastern Orthodoxy, the Pope's readiness to reassess Martin Luther and the call by 138 Muslim leaders for an institutional dialogue with Christianity. What could Mr Blair's initiative add to the work of the Three Faiths Forum, St Ethelburga's Centre for Reconciliation and Peace and the Cambridge Interfaith programme, to name but three?

The answer is much needed political weight and experience. Religious leaders speak from the heart; they are not often versed in the pitfalls of politics or public relations. The furore that followed the Archbishop of Canterbury's remarks on Sharia two months ago clearly shows how meaning and intentions can be obscured by a wrong choice of words or emotive associations. Mr Blair himself demonstrated a sensible caution in outlining his proposals. The scale is ambitious: he sees the forum in global dimensions, building partnerships with existing interfaith bodies, championing moderation and religious tolerance so that different faiths, like societies and economies, can live and work together. But the initial steps will be modest, with the forum growing as it raises funds, hopes and expectations.

Sensibly, Mr Blair also shied away from doctrinal disputes. There are indeed epochal struggles and reassessments now going on within religions, especially within Islam. But it is not the place of any forum intending to promote tolerance to side with this or that faction, impose its views or plunge into theological controversy. Mr Blair clearly wants to see faith credibly underpinning modernity, progress and intellectual clarity. For that, the forum must grapple with issues such as embryology, poverty and Aids, but only to ensure that the common voice of moderation is heard in all faiths, not as an arbiter between faiths or as doctrinal melting pot.

Mr Blair's new role is one of the most sensitive he has yet attempted. It would be a pity if his other commitments in the Middle East, Europe and in saving souls at JPMorgan left him little time for the impetus needed. Rather than retiring and doing too little, it looks as though he is doing too much. If he engages clearly and vocally in the faith debate, he will find it harder to return to frontline politics. Perhaps that is why he says his faith will be “the rest of my life's work”. He has embarked on a project with characteristic ambition. The man who sought to redefine the arguments between Left and Right is now looking to host not one, but two even bigger debates: the argument between people of faith, the moderate of one side and the doctrinaire on the other, and that between those who believe and those who do not. He is cultivating a conversation that involves every one of us. Nearly a year after leaving office, Mr Blair has returned to public service.