Britain made "real progress" in 2013 in strengthening its economy and creating jobs, David Cameron has said in his Christmas message.
In a message which otherwise stressed the religious aspects of Christmas, the Prime Minister described the year which is coming to an end as a period in which "our country pulled together to overcome the challenges we face".
And he used the message to revive his concept of the "big society", which critics claim has been quietly sidelined since playing a major role in the Conservative general election campaign.
He voiced his gratitude for Christians who volunteer and help their neighbours, saying that by doing so they are helping to build the big society.
In his message issued by 10 Downing Street, Mr Cameron said: " Christmas gives us a space when we can consider the things that we value most - family, friends and fellowship. It is a time for being hopeful for the coming year and to reflect on the one that has passed.
"Looking back, 2013 has been a year when our country pulled together to overcome the challenges we face. Together we have made real progress on strengthening our economy and creating more decent jobs so that people can provide for their families. This progress is down to the efforts of millions who go out and work hard every day, putting in the hours, running businesses and keeping our economy going.
"And there are those millions who keep on strengthening our society too - being good neighbours, running clubs and voluntary associations, playing their part in countless small ways to help build what I call the 'big society'. Many of these people are Christians who live out to the letter that verse in Acts, that `it is more blessed to give than to receive'. These people put their faith into action and we can all be grateful for what they do."
Mr Cameron added: " 2013 was a significant year for the Christian faith - a year that welcomed the Most Rev Justin Welby as the new Archbishop of Canterbury and saw His Holiness Pope Francis elected to lead the Roman Catholic Church. Both have come in with exciting plans to rejuvenate their respective churches, which should inspire Christians around the world.
"For me, this season is also a time to think about the meaning of Christmas - the birth of Jesus Christ and the hope that gives to millions. In Handel's Messiah, these words from the Prophet Isaiah are brilliantly put to music 'His name shall be called Wonderful, Counsellor, the mighty God, the everlasting Father, the Prince of Peace'.
"With peace in mind, I would like to say thank you to our brave servicewomen and men who are helping bring peace here and around the world; to their families who cannot be with them; and to all the dedicated men and women in the emergency and caring services who are working hard to support those in need this Christmas.
"Have a peaceful Christmas - and a very happy New Year."
In a festive message to the armed forces - recorded during a visit to Afghanistan - Mr Cameron told them that what they stood for was as important as what they did.
"Can I wish everyone who serves, and the families of all those who serve, a very, very happy Christmas and a very good and hopeful 2014," he told British Forces Broadcasting Service (BFBS).
"First of all, I want to say how much it is we admire all the things that the military and armed services do for our country.
"Here in Afghanistan, once again, I've had the immense privilege of seeing that at first hand.
"But as important as what you do, it's what you stand for.
"It is those values of courage, of service, of putting others before yourself, of putting into your community.
"Those values are values that run right through our military and through service families, they're great values for you, they're great values for our country.
"So let's celebrate both what you do and what you stand for, and at this Christmas time above all, thank you."
In his Christmas message, Labour leader Ed Miliband paid tribute to those people who would be spending time over the festive season caring for the lonely and the homeless.
"As Christians prepare to celebrate the birth of Jesus Christ, we should also take time to think of all those alone or suffering at this time of year," he said.
"I would like to pay particular tribute to the many people, churches and charities who will be looking after those who are alone or homeless this Christmas time.
"We should also pay tribute to those who will be working so that the rest of us have an enjoyable break, especially our medical staff, our police and our armed forces, thank you for your service."