I think that, first and forremost, it's the parents who should drill manners and respect into their children, and then schools should continue with it, by means of being far stricter than they have been.
The government could do their bit, by passing laws to fit the crimes, and by basically going back to good old-fashioned methods of teaching. It's a subject which could be debated forever, but also, the pressure to be surrounded with material goods, means that in many cases, both parents are out at work, leaving little time or energy to be bothered with what their children are getting up to in their absence.