The youth justice system could be overhauled as part of David Cameron’s vision for a ‘smarter state’, the prime minister and justice secretary announced today.

David Cameron has asked Charlie Taylor, former chief executive of the National College of Teaching and Leadership, to lead a review into the system, in which the prime minister said he ‘especially’ wanted to see improvement.

Announcing further details of the review, justice secretary Michael Gove said Taylor will look at the evidence and current practice in preventing youth crime and rehabilitating young offenders, how the system can interact more effectively with wider services for children and young people, and whether current arrangements are fit for purpose.

The review will report back next summer.

Charity Just for Kids Law welcomed the review, which it hoped would be ‘meaningful’ and ‘innovative’.

Director Shauneen Lambe (pictured) said the organisation had ‘long maintained’ the way the system dealt with troubled young people in England and Wales was not working.

‘We believe that as well as looking at how to reintegrate young people into society after they have been in custody, it is important, and cost-effective, to look at how we can prevent children from being entered into the system’.

Charities wanting to work with specific types of offenders could bid for new prisons under government proposals to sell off ‘old, dark and overcrowded’ inner-city prisons and build ‘new, effective’ prisons ‘which are not just safe and secure, but contain facilities that will lower reoffending rates’.

Cameron used his speech - billed as a trailer to November's spending review but timed to coincide with the announcement of the new Labour party leader - to set out three principles of a ‘smarter’ state: reform, devolution and efficiency.

He said the government’s priorities included ringfencing NHS and school budgets.

‘These are the priorities we have chosen,’ he said. ‘And whatever difficult decisions we face, we will keep these promises, because they are fundamental to delivering the “one nation” [on the side of the working people] vision.’