2012 was the year that the divide between the people and the powerful became dangerously wide. The tragedy is there's still so much to be proud of in Britain...

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Where will 2012 stand in history? It was not one of the outstanding, iconic years like 1945, the year World War II ended, or 1989 when the Berlin Wall fell.

It saw no earth-shattering events to stand beside the collapse of the Soviet Union, the terrorist attacks on New York or the invasion of Iraq. In many ways, indeed, the story of 2012 was simply more of the same. In Britain, the Coalition limped miserably along, while the economy stubbornly refused to improve.

On the Continent, the euro staggered blindly from crisis to crisis. In the Middle East, the festering sore of the Israel-Palestine conflict claimed the lives of hundreds more victims, while the Arab Spring slid further into bloodshed.

And across the Atlantic, Barack Obama won an unexpectedly comfortable re-election against a backdrop of bitter ideological wrangling, fiscal brinkmanship and the horrifying massacres in Colorado and Connecticut.

Here in Britain, most will remember it as the year of two glorious public celebrations: the Queen’s Diamond Jubilee and the Olympics.

After months of bad news, the summer’s events were a chance to remind ourselves that in the cultural and sporting arenas at least, British creativity and inspiration still lead the world.

It was, as one American newspaper put it, a year with a pronounced British accent, from the box-office triumphs of James Bond and the adaptation of Oxford don J. R. R. Tolkien’s The Hobbit, to our cricketers’ splendid series victory in India and our rugby team’s thrashing of the supposedly unbeatable All Blacks.

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And yet, if 2012 had a British accent, it was not one that Bond author Ian Fleming, or indeed Tolkien, would have recognised. Last month’s release of the latest census results showed how much our country had changed during the years of New Labour rule.

Tolkien, a deeply religious man shaped by the horrors he witnessed on the Somme, would be astonished to discover that barely six out of ten people now call themselves Christians.

And Fleming, steeped in the values of Empire and convinced the British had a right to rule the world, would have been astounded by the news that almost eight million people in England and Wales were born abroad, while in London, white British residents are now a minority.

Patriotic: It was a year with a pronounced British accent, with box-office triumphs including James Bond and the adaptation of Oxford don J.R.R. Tolkien's The Hobbit

To my mind, though, the real change since the days of Fleming and Tolkien has been deeper and more subtle. It is true that to modern eyes, their era often seems intolerant and censorious.

Yet they grew up in an age that took duty seriously, prized responsibility, shrank from self-indulgence and had a profound, almost transcendent faith in the great institutions of the British Establishment.

Perhaps it is just as well, then, that they were not around to see what happened in Britain in 2012.

For there is no getting away from the fact that, as far as the country’s political and cultural establishment were concerned, this was probably the single worst year in  living memory.

Almost every week seemed to bring new revelations of arrogance and wrongdoing, from the petty pilfering of some MPs such as Denis MacShane — who even invented institutions and forged signatures to help himself to Parliamentary expenses — to the appalling allegations swirling around the squalid, shell-suited figure of the late Jimmy Savile.

Shocking: Almost every week seemed to bring new revelations of arrogance and wrongdoing, including the appalling allegations swirling around the squalid, shell-suited figure of the late Jimmy Savile

There is a grim irony in the fact that while we are facing perhaps the most difficult political and economic decisions in a generation, politics itself has never been in deeper disrepute.

Indeed, the grotesque farce of the elections for local police commissioners — which were so badly publicised that one polling station in Wales recorded no votes at all — speaks volumes about the corrosion of popular interest in politics.

It is little wonder that many ordinary people feel they have no stake in the political process. At the top, they see an unhappy Coalition riven by childish bickering, opposed by a Labour Party that often seems to have lost all gumption, guts and soul.

They see one of our best-known backbench MPs, the outspoken Nadine Dorries, choosing to abandon her constituents for the tawdry attractions of I’m A Celebrity . . . Get Me Out of Here! — a decision that turned politics itself into a national laughing stock.

And when many voters picture their political representatives, they imagine characters like Denis MacShane, the expenses fiddler, or Andrew Mitchell, the short-lived Tory Chief Whip who was accused of referring to police officers as plebs.

Andrew Mitchell, the short-lived Tory Chief Whip, was accused of referring to police officers as plebs

Whether Mr Mitchell used the offending word, or whether, as now seems possible, he was framed, his alleged insult was the most resonant political remark of the year.

For me, the really revealing thing about it is simply that it sounds so plausible. Sadly, it is the kind of remark most of us can imagine our privileged political masters saying, even if only under their breath.

The truth is that our institutions have never felt more unaccountable, arrogant and out of touch than they did in 2012. And that, in turn, explains why, although history is littered with largely forgotten scandals, the Jimmy Savile affair will surely echo down the years.

It had already been a bad year for the BBC. Its disastrously frivolous coverage of the Jubilee river pageant was widely regarded as one of the lowest points in its recent history, even attracting fierce criticism from the corporation’s own star performers.

But the Savile scandal was in a different league. At the very least, it suggested that for decades the BBC had been harbouring a malignant child abuser whom it then shrank from exposing because, if some accounts are to be believed, Newsnight’s revelations clashed with BBC1’s plans for a tribute to the ghastly Savile.

What was worse was that the BBC, as though punch-drunk from the inevitable storm of criticism, then contrived to smear a completely innocent man, Lord McAlpine, as a child abuser himself — a calamitous error of judgment that forced the resignation of the corporation’s new director-general George Entwistle.

What happened to the BBC, however, was not unique. Failures of leadership and loss of nerve were everywhere in 2012, which was a wretched year for institutions of all kinds. The Church of England, whose hold on our national imagination has declined so precipitously in recent years, sank to a new low in the autumn. To most sensible people, the advent of women bishops is long overdue. Yet, in its wisdom, the Church’s General Synod chose to reject it.

It was a bad year, too, for the police, whose disgraceful dishonesty after the Hillsborough disaster in 1989, when they tried to smear innocent Liverpool fans who had been crushed to death, was finally exposed by an independent report.

Or take the British security services in Northern Ireland, whose involvement in the murder of solicitor Pat Finucane was at last admitted by a government inquiry.

This was, in fact, the year of the inquiry, which has become the Coalition’s stock response to challenges of any kind. Increasingly, it seems that whenever a difficult issue arises — such as the question of a new runway at Heathrow — the Government’s only answer is to convene yet another inquiry.

Stock response: Increasingly, it seems that whenever a difficult issue arises, the Government's only answer is to convene yet another inquiry

Meanwhile, the most notorious inquiry of all, Lord Justice Leveson’s investigation into phone hacking and journalistic misconduct, reached a sadly predictable conclusion with his calls for state regulation of the Press.

No sane person would dispute that papers such as the News of the World behaved disgracefully. There is a bitter irony, though, in the fact that Lord Justice Leveson’s proposals would interfere with the one thing most likely to bring scandals to light and hold the powerful to account — a free Press.

Yet the past year was not all doom and despondency. And surely not even the most cussed and curmudgeonly among us could deny that there was much to celebrate.

For while 2012 may have been a terrible year for the Establishment, it showed the British people at their best. The London Olympics were widely expected to be a complete washout. Many commentators — myself among them — predicted chaos on the roads, empty seats at the venues and a general air of apathy  and disorganisation.

Never have I been happier to be proved wrong. From the splendid opening ceremony, a patriotic paean to the courage and imagination that have made Britain the envy of the world, to the selflessness of the volunteers, the dedication of our Armed Forces and the achievements of our athletes, the Games could hardly have been a  better showcase for our country.

Proud: Even the sportsmen and women who had so many of us cheering with full-hearted pride were reassuringly down-to-earth people, from the sardonic Bradley Wiggins to Sheffield's beloved Jessica Ennis

To my mind, they were more than a sporting sideshow. For what brought them alive was the generosity and public-spiritedness of thousands of ordinary people who gave their time without any thought of financial reward or self-interest.

Even the sportsmen and women who had so many of us cheering with  full-hearted pride were reassuringly normal, down-to-earth people, from the sardonic Bradley Wiggins to  Sheffield’s beloved Jessica Ennis.

And, of course, there was the  admirable figure of Mo Farah, born in Somalia but now delighted to drape himself in the Union Jack without apology or ambiguity.

What made men and women like these such marvellous role models — in stark contrast to our arrogant footballers or our pampered politicians — is that they embody values long thought to have fallen from fashion.

They trained for long, punishing hours, pushing themselves to the limit, determined to produce the best possible performance they could.

Admirable: Mo Farah was born in Somalia but draped himself in the Union Jack without apology or ambiguity

In our public life, perhaps the only major figure who embodies a similar spirit of sheer dedication is the Queen herself, which is why so many millions of people wanted to pay her an emotional tribute during her Diamond Jubilee.

Despite the carping of a handful of second-rate intellectuals, the indisputable fact is that the vast majority of ordinary people have enormous affection for the monarchy.

If nothing else, it is the one institution — apart from our Armed Forces — that still stands unambiguously for the notion of public responsibility.

There is, however, something terribly worrying in the fact that other institutions seem unable to learn the obvious lessons and to bridge the gap between the people and the powerful.

From Europe to the economy, the gulf between our political class and the families it claims to represent has probably never been greater.

Popular unease about the extraordinary rise of immigration in the past ten years, as reflected in the latest census, is merely one symptom of a wider malaise. And it is hard to banish the fear that, in the long run, apathy and alienation will breed discontent and unrest.

The tragedy is that there is still so much to be proud of. No other country on earth could have hosted an Olympics with the wit, imagination and flair that we showed during those memorable summer weeks.

Our popular culture remains second to none, while our scientists and engineers are as ingenious as any in the world.

We will need them in 2013, which promises to be a hard year.

The economy is unlikely to improve, the Coalition inspires little confidence and the dreadful situation in Europe may well get worse.

Yet as this summer so magnificently proved, the British people have unmatched reserves of spirit, stoicism and selflessness. Perhaps, in the next 12 months, our national institutions and our political masters might start to emulate them.

It may sound an unlikely prospect, but stranger things have happened.