I am very pleased to be to speaking to you today. To 500 Charter Mark winners - a record. Many of you are previous winners. 18 of you are here for the third time.
So my first reason for speaking to you today is simple. To say thank you. To say thank you to Dyfed-Powys Police, for investigating every reported crime and solving two thirds of them; to the Compensation Agency in Northern Ireland for cutting costs by a tenth while increasing applicants' satisfaction by a quarter; to the Newcastle Benefits Agency for working with the local authority to improve their service to pensioners. To say thank you to you all for the work you do.
But there's another reason. I want others to notice how good government can be. Because we should value our best public servants - people like you - as much as our captains of industry.
Valuing public service
I said last week that we needed to change society's prejudices about volunteering. That do-gooding shouldn't be a term of derision. Well it's the same for public service.
We inherited an under-valued public sector. It is absurd that we ever got into the position under the previous administration where government seemed to devalue the very people it relied upon to deliver its programme. Where private was always best. Where the public sector was always demonised as inefficient.
In the last 21 months, I've met many people across the public sector who are as efficient and entrepreneurial as anyone in the private sector, but also have a sense of public duty that is awe-inspiring. Most of them could be earning far more money in business. But they don't and you don't.
Why not? Because of a commitment to public service. Because helping a five year old to read, coaxing a patient out of a coma, convicting a burglar is fulfilling in a way that money can't buy. This country needs its wealth creators, but it needs its social entrepreneurs as well.
So let me say today, loud and clear - this government values public service; this government is proud of its public servants. What made you choose this career is what made me go into politics - a chance to serve, to make a difference. It is not just a job. It is a vocation. Britain relies on that ethos of public service, and we need to rekindle it if we are to deliver improved public services.
After 18 years of public service being talked down, this is a difficult task. There was a time when we could assume that the brightest and best of each generation would want to join the public sector. But that is an assumption we can no longer make, particularly when the financial rewards at the top of the private sector are so great, and too often public sector workers are weighed down by bureaucracy and silly rules.
So this year I want to launch a major new initiative on this. Not delivering a solution from on high, but starting from what public servants think, from your day-to-day experience, your successes and frustrations. Through this speech today I want to start a conversation with public servants and others, about recruitment, retention and motivation. Write to me or take part in the debate on the Number 10 web site. We will respond through the Modernising Government White Paper later this year. And we will not duck the difficult questions you raise.
So, first, we will tackle pay. For example, in teaching, we are proposing the most radical changes to the profession in living memory. In health, we will see that nurses are properly rewarded and improve recruitment and retention. In both, we are revising pay scales and introducing new grades - advanced skills teachers and nurse consultants - so that more can afford to stay at the front-line.
But increased pay must be tied to improved results. And that may mean taking on some sacred cows to make better use of the pay bill. Do we need greater differentials within the public sector? Should we decentralise pay more? What are the lessons of performance pay and where else should we be using it?
Of course, there will always be constraints on public resources. We will never match the salaries at the top end of the private sector. So we need to look at non-financial rewards too.
This is about esteem - from ceremonies like today's to nominations to the House of Lords, from careers advice to portrayal in the media. But what more should we do?
It's about career prospects. So in both teaching and health we are looking to fast-track careers. But what more do we need to do to retain the enthusiasm of young people? Should we be devolving responsibility earlier and further down our organisations? How can we spot those with exceptional potential and bring them on quicker?
It is about making sure we get the best people into public service drawn from all sections of the community and all ethnic and religious backgrounds. So for example new patterns of family life mean working habits must change. But progress is often frustratingly slow. What more could we do to make a difference?
It's about developing skills. So, we're creating the Centre for Management and Policy Studies in Whitehall - a virtual business school for the public sector. There are similar initiatives in health, education, local government. But again we may need to do more.
It's about greater career flexibility. So we are examining how we can make it easier for people to move between departments and around the public sector. And we need to get more interchange with the private sector - so it becomes routine rather than exceptional for there to be private sector appointments to the civil service for a few years and civil servants gaining experience in the private sector before rejoining the civil service.
And of course it means not tolerating mediocrity in the public sector. I make no apology for saying that we cannot afford incompetent teachers, nurses, police officers, local government workers. Because all that will do is undermine the good work done by people like you. So, what more could we do to have fast but fair disciplinary and incompetence procedures?
Modernising public services
So we need to value and reward public servants. But the main reason people will come into the public sector and their most important reward will still be the chance to make a difference, to be part of a public service they are proud of. So I now want to turn to our strategy for modernising public services.
This must start with a diagnosis of the problems faced by the public sector. First, they needed proper investment, especially schools and hospitals. So, over the next three years, we are investing in our public services - ??40 billion in health and education alone.
But the problem was not just how much government spent. It was how it was spent. Ministers traditionally spent most of their time fighting yearly spending rounds. Departments pursued policies that were contradictory. Efficiencies were covered up for fear the Treasury would take the money back. Front line workers were hampered by silly rules.
We've already started to address these problems and will elaborate our strategy in the White Paper. I believe it is nothing short of a quiet revolution in the way government works in Britain, an approach focused on outcomes, rather than inputs.
That's why we started with a Comprehensive Spending Review - so that we could adapt the spending patterns we inherited to the priorities on which we were elected.
We have made big changes in what the money is spent on, but only in return for clear targets. For the first time, these have been published, in Public Service Agreements. They set out long term objectives in each area, backed by 500 clear, demanding targets such as: cutting deaths from heart disease and strokes by a third amongst people under 65; or getting half of 16 year olds achieving 5 or more A-C's at GCSE.
In turn, departments are setting standards for local public services to deliver - whether on exam results, rough sleepers, truancy or waiting lists. And local agencies are setting their own targets for local people to judge their success.
Focusing on outcomes will allow us to address the second traditional weakness of Whitehall I mentioned - contradictory policy making. Government is organised vertically, with departments based on the function they perform - such as paying benefits or running the National Health Service. But people's problems are rarely so neat: the socially excluded will need help not only with housing, but education, health and so on; starting up a new business will involve interaction with a whole range of Government agencies.
We are determined to overcome these divisions. New approaches to joined up government are being tried all over Whitehall - the Social Exclusion Unit in the Cabinet Office, Sure-start for the very young or the new Active Community Unit that we announced last week. All examples of policies being developed and implemented jointly across departments, with joint targets and often joint budgets.
Focusing on outcomes also helps us free up the public sector. Because we have agreed what departments are trying to achieve, we spend less time double guessing how they do it. The centre can devote more time to developing strategy and less to trying to micro-manage front line services.
In particular, we have given departments three year spending plans. Departments can now shift money between programmes and keep any savings they make from one year to the next - another revolution in Whitehall, which should eradicate the traditional March rush to spend unused budgets before the end of the financial year.
Again, departments are passing those freedoms on to their front line. We have abolished crude and universal capping of council tax, while at the same time protecting local tax payers. We have put doctors and nurses in the driving seat in shaping and funding local health services.
And the more successful you are, the more autonomy we will give you. So, for example, OFSTED is introducing a light touch inspection regime for good schools. The best councils - beacon councils - will in due course have more freedom to vary local taxes.
But that doesn't mean we will tolerate failure. Because the people who suffer from a bad service are the users - the pupils, the ill, the elderly, often the most vulnerable in society.
So we need rigorous and fair inspection systems to know whether public services are achieving their targets. We need league tables to allow individuals to choose which services to use. And we need competition within the public sector and where appropriate with the private sector - because what matters is not who delivers the service but the outcome it secures.
Now freeing up the public sector doesn't mean we will cut you adrift. We will help you by spreading best practice. This needs to be rigorous, based on evidence of what does and doesn't work. In the health service, we are setting up the National Institute for Clinical Effectiveness - to assess what treatments works best and at what cost and issue guidance to front-line doctors. In local government, we welcome the fact that the LGA has set up a new Improvement and Development Agency. In education, we are implementing a numeracy and literacy strategy to tackle decades of under-performance.
But guidance from the centre can only go so far. The problems you face are all different. You often know how to solve them, but are held back by silly rules or set ways of doing things. That's the rationale behind action zones for health, education and employment. They are laboratories to test new ways of working. They suspend rules that stifle innovation and ensure that those innovations can be spread around the system.
But it's also about culture. We shouldn't be afraid to take risks, even if that means risking failure. When we fail, we should learn from our mistakes. Because if we never make mistakes we'll never change anything. My idea of the ideal public servant is not someone who never fails, but someone who always tries to make a difference.
Finally, we need to organise our services around the individual. That means listening to their views. That is why we have set up a People's Panel of 5000 to ask taxpayers about the services they get. And it means organising services around the needs of users, not the convenience of producers. We live in a 24 hour economy - we can no longer deliver services 9 to 5, Monday to Friday. We are in the middle of an information revolution - we need to explore how the telephone and the Internet can improve convenience. For example, NHS Direct will enable people to contact a nurse over the phone when they need help, rather than going to hard-pressed A&E departments.
So we need public services that feel tailor-made - not uniform,'one size fits all'. We need to find better ways of delivering services, particularly enabled by new technology. And there's a ??2.5 billion Capital Modernisation Fund to turn those new ideas into reality.
I've argued today that we need to turn back the tide. Stop denigrating public service, start valuing public servants again. Match the private sector at its best, be proud of the public sector at our best. Provide proper rewards and funding, not services starved of cash and with low morale.
I've tried to start a debate about attracting people into the public sector. I've said that will involve financial and non-financial rewards. And that it will involve giving you the resources to do your jobs.
I have outlined our strategy. Invest in public services. Focus on outcomes. Devolve power to the front-line. Value the public servants who succeed. Encourage innovation. Work across government boundaries. Organise around the individual.