by Malcolm Hyde, regional director, CBI South East

There are two principal challenges facing public policymakers at the moment. The one I mention most often is growth: how we get the economy moving, how we encourage entrepreneuralism and job creation. Whether the recent Budget delivers that time will tell.

The second challenge is how we can deliver good public services in a time of spending constraints - delivering more with less is possible but not easy.

An ageing population, many with chronic health problems, are no longer happy with 'like it or lump it,' wanting more and better services. This is putting huge pressure on health, social care and welfare, meaning not just years but often decades of extra demand for services.

Responding to this isn't optional for our public services. It's what they're there for.

The government has set out its stall to create a sustainable path for the public finances, chiefly through spending cuts and not tax increases.

Yet the response from some quarters has been disproportionate. Plenty of vested interests have said the same thing: 'Yes, we accept the need for some cuts, but not this many and not in our area'.

The TUC warned that Britain 'will become a darker, more brutish place', adding that reducing the deficit is taking us on an 'economic death spiral from which escape is all but impossible'.

Back in the real world, we must hope public service managers will respond rather more positively and find new ways of providing the services people want at a price the country can bear.

Making cuts is rarely easy, usually painful and there are often casualties. But saying change is impossible shouldn't be the default response.

What we need is the re-engineering of our public services.

Most large organisations have re-engineered their products and services in response to the pressures of a dynamic, competitive world. The best ones have done this with deliberate disregard to the status quo and by starting with a clean slate.

Our public services should do the same, and ask some fundamental questions: What's the purpose of a service? Who uses it and why? Are user needs being met?

For it to work, we'll need strong leadership with a clear vision, properly engaged employees and people to take risks - to invest even if the saving won't benefit their specific budget but will mean savings elsewhere.

We need to be sensible and constructive: no magic bullets or poisoned darts, just reason, reassurance and optimism that we can do things better.