'Big society' is the solution to poverty, declares Cameron

Conservative leader accuses Labour of fostering a centralising bureaucracy

The Conservatives will replace Labour's "big government" with a "big society" which would be more effective at tackling poverty, David Cameron pledged last night.

In a keynote speech, the Tory leader rejected both a return to Thatcherism and New Labour's vision of a "smarter" state. He said voluntary groups and charities could take on a key role in helping people to escape poverty.

Mr Cameron argued that since 1997, Labour has run Britain's most centralising government since the Second World War. He claimed that, far from promoting "social solidarity," it had led to "selfishness and individualism".

Giving the Hugo Young Memorial Lecture, he sought to answer critics of his speech to last month's Tory conference who questioned how his promise to root out poverty could be squared with his pledge to usher in "smaller government" in a "post-bureaucratic age". Last night he said the state would have a powerful, active role in securing a cultural change which empowered people and encouraged them to take responsibility for their own lives. "We must use the state to remake society," he said, and turn "state action to social action". But he conceded that this "re-imagined state" might not be created in two five-year parliaments and could take a generation.

The Tory leader argued: "The era of big government has run its course. Poverty and inequality have got worse, despite Labour's massive expansion of the state. We need new answers now, and they will only come from a bigger society, not bigger government."

He promised a "clean break" with Labour policy in three areas:

*the Sure Start scheme for the under-fives should stay, but it must better involve voluntary bodies and charities and increase its focus on the poorest;

*self-governing state schools accountable to parents, with a new "pupil premium", creating an incentive for the best schools to attract children from the poorest families;

n "payment by results" for both welfare recipients and welfare-to-work providers seeking to get them back into jobs.

Mr Cameron promised a radical devolution of power to the lowest possible level, with some services taken over by community groups neighbourhood by neighbourhood.

The Tories would expand the role of community activists, franchise out proven state-funded programmes to successful social entrepreneurs and seek to mobilise the millions of people not currently involved in such work – for example, by encouraging a "social action" line in people's entries on the Facebook social networking site.

Mr Cameron said organisations which had been asked to go outside government for funding improved their record of engaging with the public. But he conceded that it was wrong to assume that a "simplistic retrenchment of the state" would allow better alternatives to spring to life.

Distancing himself from Thatcherism, he said: "Our alternative to big government is not no government – some reheated version of ideological laissez-faire. Nor is it just smarter government. Because we believe that a strong society will solve our problems more effectively than big government has or ever will, we want the state to act as an instrument for helping to create a strong society. Our alternative to big government is the big society."

Mocking Gordon Brown's "moral compass," he said it was no wonder that "society is broken" when people were paid more not to work than work and were better off leaving their children than nurturing them. In this world, he said, "state control is a substitute for moral choice and personal responsibility".

Yvette Cooper, the Work and Pensions Secretary, said: "The truth is that, behind the rhetoric, this is just a return to Thatcherism or 19th century liberalism, calling on the state to withdraw, leaving people to fend for themselves, and charities and community groups to pick up the pieces. The last time the Tories tried that, child poverty doubled."

Good samaritans: Community champions

Debbie Scott

David Cameron was so impressed by the chief executive of Tomorrow's People, the employment charity, he invited her to be a Tory peer on Monday. The charity was founded in 1984 and helps long-term unemployed people overcome the barriers that prevent them working. Scott, who has an OBE, is famous for her enthusiasm and "nothing is impossible" attitude.

Jamie Oliver

After shooting to fame as the Naked Chef, Oliver set up the north London restaurant Fifteen in 2002. Broadcast on television as Jamie's Kitchen, the restaurant took on 15 disadvantaged young people as chef apprentices. There are now franchises in Amsterdam, Cornwall and Melbourne. All profits go back into the Fifteen Foundation to train more youngsters.

Selwyn Dyson Image

The former management consultant founded the UK wing of Emmaus Communities, which helps homeless people to rebuild their lives. Mr Image, who was made a CBE in 2007, set up his first branch in Cambridge in 1992. The movement began in France in the 1940s.

Jessie Joe Jacobs

Winner of this year's Social Entrepreneur Awards run by the Bank of Scotland, Jacobs co-founded her charity, A Way Out, while studying at Durham University in 2002. She provided a youth club and activities for a community in Stockton-on-Tees to reduce the impact of drugs and poverty on young people. Now 50 children attend every night, and she plans to use her £100,000 prize to set up more franchises.