Lib Dems unveil pre-election spending plans

Liberal Democrats leader Charles Kennedy outlined the party’s spending plans for the forthcoming General Election today.

He proposed moving some government departments out of London, in order to boost employment in other areas and save money.

Mr Kennedy also revealed that a Lib Dem government would scrap the unpopular council tax in favour of a local income tax, averaging around 3p in the pound.

The party’s spending policies also include proposals to axe several Whitehall departments, such as the Department of Trade and Industry, and scrap programmes, including “baby bonds”, plans for ID cards, and a number of arms programmes.

Mr Kennedy said the plans represented “better spending, not higher spending” and claimed that savings made by the cuts could be redirected into health, poverty, crime and pensions.

He added: “The Liberal Democrats no longer argue that extra spending on our priorities must be met automatically by an increase in the total level of taxation. It is time for tough choices to deliver Liberal Democrat priorities.”

The “alternative budget” also included a number of surprisingly right-leaning policies, such as privatisation of government bodies, including the Royal Mint, the Defence Export Services Organisation and British Trade International, and plans for new PFI-built prisons.

The speech reaffirmed the Lib Dems’ commitment to road user charging and higher taxes for salaries over £100,000.

Mr Kennedy argued: “There are two key problems: too much money is being spent on low priority areas with not enough making it through to the front line. And the government insists on controlling everything from the centre, obsessed with targets that are insensitive to local conditions. Micro-management from Whitehall is inefficient and ineffective.”

Treasury spokesman Vincent Cable will also address the pre-budget lunch in London.

Meanwhile, Labour fought back, publishing a list of 100 alleged spending pledges from the Lib Dems in the past two years. The Labour Party referred to their rivals as “the party that can’t say no”.

Conservative shadow chancellor, Oliver Letwin, commented: “The sad fact is that the country cannot afford either the Labour or Lib Dem programme, because the country cannot afford another set of tax rises after the next election.”