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1 It's an enormous privilege to be here this afternoon and it is only right that I begin my remarks with a few words of thanks and applause.

2 For nearly 2 decades now ACEVO has brought together chief executives to make a difference. Your members represent I think, much of what is truly remarkable and valuable about our country:  our innovation and our inventiveness; our compassion and concern for the underdog; that quiet passion; that steely determination and most importantly an intolerance of injustice.  The country owes you a debt of gratitude, and we don't get to say this very often, but it is a privilege to serve alongside you.

3 I want to talk about what we need to do with that passion for change if we're to make Britain a better place in which everyone, regardless of the home into which they were born, regardless of their wealth, their race, or their creed everyone can achieve the full measure of their potential.   The challenge became very clear to me one sunny Monday morning when I went on a visit a few weeks ago, a couple of miles south of where I live in Birmingham.

4 On a visit, I met an inspiring man named Kevin, who had just been given the chance to set up home independently in Northfield in Birmingham.  Lots of attempts had been made at resettling Kevin in the community, but these all failed, and when the long stay hospital that was his home closed, Kevin ended up in a Mental Health Trust home.  Now thanks to a hugely innovative supported living outreach team that has brought  together the health service, Local Authorities and the not for profit sector operating in Birmingham, Kevin has now moved into his own flat.  He is now enjoying the quiet miracle of a normal life.

5 From needing 24 hour supervision and support, Kevin now only needs support during the day, and has settled well into his local community.  Not only was he happy, he was trying courses at college and starting to experiment with getting a job.  And when I asked him what the biggest difference was between his new life and his old life on a ward, he said quite simply that it was the chance to enjoy his own peace and quiet.

6 Two hours later that day I visited Sandwell Community Caring Trust, which is an extraordinary venture that offers a range of sheltered housing, and children's respite centre services to the local population, helping people who had lived in long term hospitals to have their own homes.  One home, they had equipped for two terminally ill children who had been living in foster homes and were now for the first time making their own choices about their lives.  They had gone shopping and decorated their rooms with West Bromwich Albion football scarf's and posters. For the first time, these two young people were given the chance to make real decisions, such as how to decorate their rooms.

7 Now, I know what you think of politicians.  And I'm afraid that I have to confess to having read a bit of Machiavelli.  And in fifteenth century Florence he said something interesting.  He said there is nothing so hard in this world as to seek to introduce a new order of things.  Well he was right.

8 Kevin had been living on a locked ward for over 18 years and now he is a free man.

9 When I asked, Sandwell Community Caring Trust said it took them 4 years to get their West Bromwich development in place.  And that even now they struggle to pick up local authority business even though they are offering a remarkable service often with lower unit costs.

10 So, here we are in the 21st century in Britain and we have; on the one hand residents desperate for a different life - the quiet miracle of a normal life - and on the other, we have people like you, people committed people with a vocation, a passion and a calling desperate to make a difference.  But in the middle is the system.  Both are frustrated - which tells us that we have to change the system.

11 Now I know what you're thinking.  I know that sounds glib.  I know you've heard this before.  But what we have to realise the imperative of reform has never been stronger than it is today.

12 The truth is that today our health and social care system in England is at an inflexion point.

13 We have made huge advances in the battle against big killer diseases.  Our investment in advanced medical science, in 138 new hospitals in over 100,000 new doctors and nurses have cut waiting times by over a year and quite simply cut death rates: mortality rates for cardiovascular disease are down nearly 31% in the under 75s; cancer mortality rates are down 12%. People are quite simply living longer because of additional investment and reform.

14 These trends are going to accelerate, providing terrific new opportunities in terms of rapidly changing technology but also risks of new inequalities.  At the start of the cold war, Albert Einstein said; 'It has become appallingly obvious that our technology has exceeded our humanity'. Now we have a chance of over-turning that aphorism.  We live in an age when technology - particularly medical technology - creates new chances, not threats, for humanity.  We stand on the brink in this country of a revolution in medical science. In the next few years, we will finish mapping the human genome. By 2010, genetic screening will be widespread. By 2015, 30% of life threatening diseases may have found a cure.  And we may well have a cure for cancer in my lifetime.

15 But to guarantee that the result is a society where all of us are able to achieve the full measure of our potential, we have to weave a web of care around the individual.  This means the nearly 17 million people in our country who live with long term conditions: including 1.5 million with diabetes; 5 million people with asthma; 4 million with heart disease and 10 million with hypertension.  Nearly 2.5 million people with learning disabilities and 2.5 million adults with sensory impairments.  We have to deliver these changes to everybody, not to the rich.  We strongly believe in the basic value of the NHS that there should be equal access for all and it is this equity that is the biggest challenge to our local NHS and care systems:

16 Although there are different interpretations of data, it's not clear that advances in life expectancy are being matched year for year by advances in healthy life expectancy.  A woman today might live to 83 - but today up to 5 ½ years might be in ill health.

17 We may spend too little on prevention in this country just - 2% of our health spend goes on public health and prevention, compared to between 4-5  % in the US, Germany or Holland - even though we have good evidence that, especially for older people, that this is crucial, we are still not putting the money into the right place.

18 In our first two terms in office, this Government made great strides to modernise social care. A new framework of entitlements was set out in fair access to care, and in national service frameworks for older people and long term conditions.  We established the right structure of regulation and resources were doubled.  In our second phase of reform we have to build on these foundations.  We have to take the NHS and local care system into every corner of every community.  We have to seek out the convenience of every member of the public and meet that - rather than the systems convenience.  We have to match the advances we are making on one hand in medical science with advances in what you might call the salve of care.

19 You will be essential in this new world above all because of your values which to put in to effect as we make these reforms.  Because you have these values, but also because of three abilities that you have:

20 You can unlock people's motivation to gain more control over their own health; providing accessible information, giving voice to peoples' concerns, influencing the development of services often far better than we can and in a more holistic way than traditional statutory public services can.

Let me give you three examples;

21 Take Children's hospices, which are an example of innovation in the provision of services for children and young people with palliative care needs and their families.

22 A good example of this innovation is Christopher's in the Guildford area of Surrey whose founders carefully explored local needs to ensure that the type of service they established complemented and did not duplicate or replicate services but actually built upon the pre-existing pattern of local provision for children with palliative care needs.

23 Or take the Red Cross. The Red Cross is now working in partnership with the RNID and RNIB to develop the web-based communityequipment.com to provide an effective means to recycle equipment.  I know that they have plans to use their combined experience, their flexibility and commercial knowledge to look at different models to support delivery of these key services to the people who need them.  I hope they will work with us to do this. I was lucky enough to see this in practice when I visited the Red Cross service in Leicester a couple of weeks ago.  It is a good example of where the VCS is delivering a completely new service, commissioned by and on behalf of the statutory sector which is recognised as innovative and effective.

24 Or take the new generation of social enterprise. The most common form of social enterprise activities are in health and social care.  Of these, by far the largest proportions are engaged in social care.

25 In many communities in the future, better use of social entrepreneurs will not only allow us to deliver services better, it will create jobs in communities that need them and I believe in the next few years they will be joined by new examples of social enterprise, emerging particularly among entrepreneurial clinicians within primary care.

26 Traditionally the ethos in nursing has been to work within corporate philanthropic models.  Now we are moving into an era of nurses increasingly questioning traditional service provision and they will identify new models of care which they actively run themselves.  The Chief Nursing Officer is committed to supporting the development of nurse entrepreneurs.

27 Just look at the Bromley By Bow Centre, a PMS practice in NE London linked to a number of social enterprise projects and has been designated a social enterprise hub.

28 Or the Kath Locke Centre, based in Hulme, Manchester, and run by the Big Life Group, offering a far more holistic health approach to well-being. They combine the best in conventional NHS healthcare services with complementary therapies.  And I could give you example after example after example.

29 So it is clear to me that when we ask the big questions - as we are in our new White paper - we need your intellectual aid in getting the right answers.

30 Since last year, when John Reid signed the strategic agreement between the DoH and VCS, the National Strategic Partnership Forum, led by Melinda Letts, we have set out a vision for how our relationship must change.

31 But to accelerate change I announced on 17 October the membership of a Third Sector Commissioning Task Force to actually strengthen the commercial relationship between the third sector and the public sector, co-chaired by myself and Jo Williams of Mencap.

32 The aims of the Task Force are simple:

33 But these are big challenges.  What is clear to me is that the way we commission many services simply isn't working. In parts of our health and social care economy, we need a double-shift up to a larger combined scale for some things on the other hand but down to a more neighbourhood level for others.  We need your help working out what should get commissioned at what level.

34 Now the inaugural meeting of the Task Force itself takes place tomorrow and it's already developed on agenda of work and we need your help to address the challenges it raises.

35 The quality of public sector commissioners is too patchy, the users and providers are not involved early enough, the regimes between health and social care are inconsistent.

36 Within purchasing and procurement, we need to support diversity of provision and allow smaller providers to come in and compete with the larger ones, rather than constrain innovation through rigid procedures and bureaucracy.  We have to address the prohibitive costs involved in engaging with public procurement, we have to make full cost recovery a reality across the board and we have to address the tendency for short-term contracts and its effect in stifling both planning and investment in service development and the ability to generate capital to support service development.

37 When we monitor contracts, the planners need to know what the contracts staff are doing and how they are doing it, and vice versa, and both groups need to be much better informed by user experience and feedback.  We also need to find ways to streamline the demands of different regulators, again to reduce the burden of bureaucracy.  These are all big problems.

38 In this agenda there are challenges for you: and in a mature relationship of trust and confidence we also need to recognise that relationships work both ways.  Whilst there are clearly ways in which the public sector needs to smarten up its act, the mature relationship of trust and confidence that we aspire to demands that perceptions of Third Sector organisations held outside the sector must change.  The money the Government has invested through ChangeUp  and Futurebuilders will of course help to address the long-standing issues about the sector's capacity and capability to realistically engage with public service delivery.  But the sector itself - organisations individually and collectively - also has a role to play in building relationships with public sector partners and nurturing the public sector's confidence in the Third Sector as an equal efficient partner in the delivery of services.

39 The challenges are not all ours. You too have challenges to overcome. Can you provide and advocate services at the same time? Are you accountable enough to the people whose lives you want to change?  Are you prepared to make some big changes to thrive in a new world of public-not-for-profit partnerships?  I am just putting these ideas out there.

40 In conclusion, it is our Government's ambition to change this country for good. By creating a society in which each of us achieves the full measure of our potential and where, through our interdependence with each other, our society is richer. The Nobel Prize Winner Amartya Sen called this the enlargement of our capability, but pointed out that to deliver this we must remember that poverty is as oppressive as tyranny; poor economic opportunity as stultifying as systematic social deprivation; inexcusable neglect as brutal as intolerance.

41 Social justice is not an optional extra for a modern society.  A society that ignores social justice as a goal generates rage and waste in enormous quantities.  Anger that fractures it; waste that weighs it down.  A society that takes social justice seriously must not just hold on to values of social justice, but it must act on them to change the world we live in.  Its that action rooted in those values that make us partners in delivering change.