Alan Milburn has called for charities to be "brought in from the cold" in the delivery of public services.

Speaking to the Association of Chief Executives of Voluntary Organisations (Acevo) on Tuesday, the chancellor of the Duchy of Lancaster said the not-for-profit sector would have a key role to play in a Labour third term.

The Cabinet minister, who doubles as Labour's election campaign and policy chief, echoed Tory calls for voluntary bodies to take over taxpayer-funded services in areas such as health and education.

As health secretary Milburn angered party traditionalists by calling for the break-up of the "monolithic" provision of care and learning.

And his latest comments will cause alarm on among some backbenchers about the pace and direction of future reforms.

"Acevo is leading the debate about how the voluntary sector can make a bigger contribution to the reforms and improvements that are needed both in public services and wider society," he said.

"I want to set out how I believe the voluntary sector can become part of the mainstream of public service delivery. I believe the voluntary sector stands on the edge of a new future."

Red tape

Milburn promised to rip up red tape and improve the contracts between Whitehall and charities in order to enable the voluntary sector to take on more government work.

"Finding new ways to empower people should be the modern progressive cause," he said.

"In a world of rapid change people often feel disempowered.

"On the one side, people are less deferential and more demanding.

"On the other, you have systems both of service provision and of political accountability that too often shut people out rather than letting them in. These systems belong to yesterday, not today.

"So as we look ahead to the future, we must deepen our commitment to progressive reforms that open up more opportunities for more people," he added.

Opposition approach

The speech came as Conservative chief Michael Howard set out his own views on the voluntary sector.

"I would like to involve the voluntary sector much more in the delivery of public services," he told the Toynbee Hall anti-poverty organisation.

"In education, we want charitable schools to be able to compete for the money which the taxpayer spends on each child - so that parents have a greater choice of school.

"In health care, we want charitable hospitals and clinics to qualify for NHS funding, if they can deliver care at NHS standards and NHS prices."

Flexibility

He added that charities have in-built advantages over government agencies.

"Central to my approach is a belief that voluntary organisations are often better at delivering services than government," he said.

"Just because the state pays for services, it doesn't have to provide them. Involving voluntary to private sectors helps to drive up standards - benefiting everyone.

"Voluntary organisations are often more flexible and more responsive than the state. They tailor their services to the communities they work in.

"They do not simply hand out money - they know how it's going to be used. They rarely suffer widespread fraud - because they know their clients personally.

"Some of the most successful organisations in the country - the schools, care homes and child care centres catering to the poorest people in society - are independent charities."