Firstly, you have to run outside. It's completely different to a treadmill, harder to begin with but ultimately much more enjoyable and rewarding. If you do all your running inside and on a treadmill, you'll not be prepared for an outside race.
If you aim to increase your distance, by around 10% each week, your speed will increase. If might also be an idea to slow down a bit too to begin with while you're getting your distance up. Don't think to do any specific speedwork yet, you need to have a good groundwork of mileage before you should move up to that.
Don't let the fact that you're not fast stop you from racing. I'm not fast (10k PB 1:02, aiming to go sub 60 this November) and I've never been the last to finish in any race I've entered. There are always people slower than you!
Good luck with your races.
Edited: 05/09/2010 at 14:28