A "break-up" of the state's monopoly over the delivery of public services should be at the heart of theTories' attempts to rebuild their political fortunes, George Osborne, the new shadow chancellor, says today.

Mr Osborne, who faced Gordon Brown in the Commons for the first time yesterday, tells the Financial Times that although healthcare and education should be funded by the taxpayer, a Conservative government would preside over a big increase in the proportion of services provided by private companies, charities and voluntary groups.