Chancellor Cable - Lib Dems name price of support

The Liberal Democrat manifesto is packed with fiscal figures. But the 'transparency' on this is not being repeated, says political editor Chris Fisher, in relation to the party's thinking on a hung parliament.

Of course he would like to become prime minister, said Nick Clegg yesterday in response to a question at the Liberal Democrat manifesto launch in the City of London. If it's ever going to happen, it won't be on May 7, according to the opinion polls. But in the event of the election delivering a hung parliament, it is possible - swallow hard, George Osborne and Alistair Darling - that Vince Cable will become chancellor in a coalition administration.

The Lib Dem leader and the party's better-known shadow chancellor seem to be almost glued together in the campaign. There is something of a father and son feel to it. Mr Clegg is 43. Mr Cable will soon be 67, and has been building a reputation for sagacity among his admirers that competes with Yoda in Star Wars (and he's rather a good dancer too).

The manifesto is built on one word, 'fairness', said Mr Clegg. It has 'four steps to a fairer Britain' - fair taxes, shaking up the education system, economic reform and constitutional change.

Trust comes into it heavily as well. Indeed, Mr Clegg is emphasising that only his party is being straight with the British people about what has to be done to reduce the fiscal deficit - and this assertion involves a big manifesto role for Mr Cable.

His plan starts from a bold position (from which he actually stares a long way in the wrong direction in terms of deficit-cutting) of raising the tax-free income tax allowance from �6475 to �10,000. This would cut average income tax bills in Norfolk and elsewhere by about �700 a year on average. But it would cost a massive �16.8bn a year; and that would to be found before the task of reducing the fiscal hole could even begin.

How? The measures that would be taken include these: restricting pension tax relief to the basic rate (�5.5bn); an annual 1pc 'mansion tax' on properties worth over �2m (�1.7bn); switching from air passenger duty to a 'per-plane duty' (�3bn); extra income from income tax, national insurance and corporation tax following anti-avoidance measures (�3.9bn). With other measures, it adds up to �17bn a year.

The manifesto also sets out new public spending commitments totalling �3.73bn in the current financial year and rising to �5.4bn in 2014-15; they include 'bringing empty houses back into use' that would cost �1.2bn this year and 'cut class sizes' that would produce a bill of �2.6bn in 2014-15.

These commitments would be greatly outweighed, however - at least in theory - by 'savings'. These would include money saved from a cash limit on public sector pay rises (�3.5bn in 2012-13); but they also involve a bank profit levy (that is, tax) that would raise an estimated �2.9bn in 2014-15. Subtracting the additional spending from the savings produces cuts in the fiscal deficit of �8.7bn in 2011-12 and �10.7bn in 2014-15.

This is all set out in tables at the back of the manifesto, and Mr Cable's fingerprints are all over them. In no time at all, Labour and the Tories were claiming they don't add up.

The Lib Dems are also saying that if extra taxes were needed, they would impose them. And they are contrasting this with 'two old parties' which, they say, are being very cryptic about post-election spending cuts and tax rises, and are 'conspiring to airbrush the recession out of this election'.

Realistically, they stand no chance of winning a Commons majority and being able to implement their full programme. But in a hung parliament they could negotiate with Labour or the Tories to get some of it put into effect.

Which parts are expendable, which would they fight hard for, and which - if any - are non-negotiable? And what about an explanation from Mr Clegg of his statement that in a hung parliament the party with the strongest mandate should have the first chance to form a government.

Is he talking votes or seats? As he knows full well, there is a significant chance of Labour winning fewer votes than the Conservatives but getting more seats. He was asked directly again yesterday, and produced an answer of almost painful evasiveness.

What's the problem? Surely not that he would rather hop into bed with the Tories, and that Mr Cable and much of the party have a preference for Labour?

Key policies in Lib Dem manifesto:

Tax-free personal allowance on income tax to rise to �10,000 - to be paid for partly by 'mansion tax' of 1pc on properties worth over �2m and by restricting pension tax relief to basic rate

Annual savings totalling �15bn, including scrapping ID cards and not renewing the Trident nuclear deterrent in like-for-like form

Cap pay rises at �400 for all public sector workers, initially for two years

Banking levy to pay for the state support received. Break up banks into retail and investment sections

Cut Department of Health by half, abolishing or cutting budgets of quangos, scrapping strategic health authorities and seeking to limit pay of top NHS managers to below level of prime minister

Integrate health and social care

Scrap Labour's personal care at home and divert cash to give one week's respite for one million carers

Prioritise dementia research

Local health boards to take over role of primary care trusts

Replace national curriculum in England with 'minimum curriculum entitlement' in state-funded schools and scale back tests at age 11. More freedom for school management

Pupil premium of �2.5bn given to head teachers, aimed at disadvantaged children, which could allow average primary school to cut class size to 20 pupils

Reform school league tables

Phase out university tuition fees within six years. Scrap fees for final-year students immediately. Scrap target of 50pc of people going to university

Put 3,000 more police on the beat. Direct election of police authorities with powers to sack chief constables

Make prisoners work, contributing from prison wages to compensation fund for victims

Presumption against short-term sentences of less than six months - replaced by 'rigorously enforced' community sentences

Neighbourhood justice panels to decide punishments for anti-social behaviour

Immediately reintroduce exit checks at all ports and airports, set up National Border Force with police powers and introduce regional points-based system to ensure migrants only work where needed

Introduce single transferrable vote system for general elections, cut number of MPs by 150 and introduce fixed-term parliaments

Replace House of Lords with smaller, fully-elected upper house

Introduce voting rights from age 16. Give powers for electorate to sack MPs who break rules.

Replace council tax with local income tax

Scrap compulsory retirement ages. State pension to rise in line with earnings, by 2.5% per year or in line with the Retail Price Index - whichever is highest

Independent review of public sector pensions, with aim of ensuring they are 'sustainable and affordable' in long-term

Increased pay for members of the armed forces

Block new coal-fired power stations. Reject new generation of nuclear power

Switch from air passenger duty to a per-plane duty

Reform regional development agencies, transferring more power to councils

Reopen regional rail lines, paid for by cutting roads budget

Cut rail fares, force train operators to ensure regulated fares fall behind inflation by 1pc per year.