Ten years after its premiere, director Max Stafford-Clark is revisiting Our Country’s Good, a play based on Thomas Keneally’s novel The Playmaker. Keneally wove historical fact and character into an imaginative account of how the first British convicts to land in Australia became involved in performing George Farquhar’s early 18th-century comedy The Recruiting Officer.

Our Country’s Good, says Stafford-Clark, “is about the healing power of theatre. Different characters see theatre as different things - a means of personal expression, a refuge, a way of life. It opens up different possibilities for them.” Keneally has a junior officer, Ralph Clark, put in charge of the production, but it is the enlightened Governor-in-chief Arthur Phillip who dreams up the idea. “He sees theatre as particularly therapeutic for the convicts. Yet he meets right-wing opposition from the officers. Captain Watkin Tench is clear that theatre is entertainment; it doesn’t matter to him whether you do it or not. Major Robbie Ross sees theatre as dangerous.”

These attitudes echo those of 1988. Stafford-Clark remembers receiving subsidy from the old Greater London Council for work they thought would reflect their outlook. “The Tories believe in art but not subsidy; Labour believes in subsidy but not art. New Labour is very suspicious of theatre. Dialogue between Labour and the arts got off to a bad start.”

Other modern parallels work within the world of theatre. The anachronistic term “director” crops up a couple of times (the director as such only emerged a century after the action of this play). “And the last thing Ralph does as director is to cut the prologue,” smiles the experienced Stafford-Clark. When he took the production to Warsaw in the late 1980s, “audiences gasped each night when Ralph called the prologue, written by a convict, ‘too - too political’.”

There’s another anachronism - in Stafford-Clark’s use of Beethoven’s Fifth Symphony at the play’s close; not the fate knocking opening motif but the glorious optimism of the last movement. That’s set to stay in the new production. By contrast, he acknowledges the play’s opening was never fully written and the Aborigine, whose short speeches are all separate from the main action, “was the one part we could never research and he is underwritten. He’s far more present in Keneally’s novel.”

Stafford-Clark is a scrupulous, unsentimental director. He points to a three-minute scene in which the female prisoner Duckling tends the dying officer Harry, who has loved her but whom she has kept at emotional arm’s length. The scene is played as if it’s a condensation of a long period. “It’s eight hours, or three minutes out of eight hours. On film she’d have a cup of tea or a cigarette. There’s a danger it could become a special, holy three minutes. Harry’s death is imperceptible. She hopes he’ll recover.”

Nor is theatre itself sentimentalised. “There’s a lot about how it creates community and co-operation, but Mary Brenham, always the keenest actor among the convicts, might tell the nervous Caesar ‘Think of us as your family’ but she is also determined to star in Australia’s first curtain-call.”

At the Young Vic Theatre, London SE1 until October 24 ; UK tour from November 3 to December 9. Tel: 0171 928 6363