Simon Reevell: We can't cut crime rates by putting more people in prison

He told the Commons that he was doing this because one of the main principles of prison reform "should be to prevent as many people as possible from getting there at all." The reaction of the Press to this new policy was negative. Churchill was accused of being soft on crime, of caring more for the welfare of the petty criminal than the law-abiding public.

Three months ago the new Justice Secretary, Kenneth Clarke, made a speech in which he argued that there were too many people being held behind bars. He said that when he was Home Secretary in the early 1990s, the number of prisoners stood at about the 44,000 mark. Today, that number had increased to more than 85,000. Clarke told us that more than 60 per cent of prisoners are serving less than six month sentences because of the minor nature of the offences they had committed. He suggested that not all but many of these might be better off serving community sentences instead.

Predictably, many commentators in the Press reacted with fury. Clarke was accused of being too liberal, too close to the criminal justice establishment. Conservative leaning columnists complained that this was yet another example of the Lib Dems driving government policy. Lord Howard popped up to repeat his "prison works" mantra and there were all sorts of dire warnings about increases in crime and disorder, of dangerous criminals roaming the streets while the law-abiding cowered in their homes.

If ever there was a time to have a proper, rational debate about sentencing, now is it. The Justice Department is expected to lose about 2bn of its 9bn budget in the coming spending review and is understandably keen to achieve more for less. The Home Office is also likely to be squeezed. The years of government ministers standing up in the Commons and promising ever larger sums of money to solve the problem of law and order are over.

Let's look at the facts. The annual cost to the British taxpayer of locking someone up in prison is 45,000, more than it costs to send a child to Eton. Each new prison place costs 170,000 to build and maintain. Almost two-thirds of adult prisoners on short-term sentences re-offend within two years of their release and the estimated cost of recorded crime committed by re-offenders is about 11bn per year.

The NAO has concluded that short jail terms do not provide value for money. A six-week spell in prison costs more than 4,500. For just 300 more, the offender could be given a high-intensity community order involving work and rehabilitation. It would be irresponsible of any government not to at least look at these alternatives, especially when the squeeze on public expenditure is likely to be so severe.

Prison can become a recruitment ground for hardened criminals. Prisoners are susceptible to peer pressure. Drugs are plentiful and bullying and sexual assault too common. Many prisoners have little in the way of family support and nothing to look forward to when they get released. When they complete their sentences they often have nowhere to live, jobs are hard to come by and they find it a struggle to survive. While not an excuse it's no surprise that so many turn to criminality to get by.

The coalition needs to be a lot smarter in how it addresses this problem, while still acting in a responsible way. David Cameron has said we will not stop locking up dangerous individuals who pose a threat to society. Murderers, paedophiles and drug dealers will still be dealt with in the appropriate manner. Indiscriminate violence (the local yob punching someone's face in on a Friday night) will be punished in the usual way because public protection must always be the Government's number one priority. But that should not stop us looking at other ways of dealing with low-level criminals.

Clarke has raised the interesting possibility of paying voluntary and independent organisations to reduce reoffending rates. The idea is simple. Outside bodies would be rewarded for keeping criminals away from trouble. Success would be judged on whether someone found a job or somewhere to live or whether they went back to college to learn a trade. It would be based on the extent to which they became a fully functioning, contributing member of society.

This could be the best approach for many lesser criminals. Class B drug users, for example, may be better off under the supervision of an outside organisation, which could help move them away from a life of crime and addiction. People with mental issues could also be helped. As a society, we need to resist the temptation to turn our backs on these people. If we can help them turn their lives around then we have a duty to do so.

For years it has been hard for politicians to make this argument. Large sections of the national media (and, if we're honest, the public at large) have demanded that governments act tough on law and order, handing out longer and harsher sentences and sending ever more people to prison. It didn't matter that this was an expensive and ineffective way to administer justice. They just wanted to be seen to be doing something, to be reacting to public concern.

This approach is now outdated. Prisons are at bursting point and cuts need to be made. We need to start doing things differently. In 1991, the then Home Secretary, Douglas Hurd, published a landmark White Paper in which he said that prison was an "expensive way of making bad people worse" – perhaps he was right.