It's just css, you have to find the correct selectors. It can be quite tedious if you don't use a dev tool like Mozilla Firebug. Even then some things take time to figure out.
In Mozilla Firebug, the overflow code centers the blue background on the page you initially posted. For a moment I noticed you applied it and it looked good, but now it's reverted.
I can't find the selector which might control the space. You may have to add it yourself, to over ride any inheritance from your theme.
On the page where you have your form, you'd have to try something like
(your form code here)
and in style.css
or something like that.