Labour could be forced to find an extra £30 billion of savings if it wants a coalition with the Liberal Democrats, it emerged today.
Nick Clegg announced that a Lib-Dem “red line” would be a “stability budget” with a commitment to clear the entire deficit.
Labour has said it would continue borrowing for infrastructure investment, but the Lib-Dem Leader said his stability budget would have to be agreed between coalition partners in the first 50 days of a new government taking office.
He said the budget would also have to include a clear timetable to push the deficit down, but did not set out a final date by which it should be abolished. Mr Clegg added: “Our definition has always been that ‘balancing the books’ means filling the structural deficit — in order to fill that black hole in our public finances which is not addressed — will not fill through economic growth alone.”
While the Tories have committed to balancing the entire budget deficit, Labour has only committed to balancing the “current budget”. This does not include spending for infrastructure investment, which is projected to be some £30 billion by 2020.
Mr Clegg also said that the Lib-Dems would not back Conservative plans to cut a further £12 billion from welfare.
The Tories have come under pressure after failing to set out exactly which benefits would be trimmed back to make the savings.
The Lib-Dem leader claimed neither the Conservatives nor Labour had “come clean” about their plans.
He said: “We will have a stability budget, to take place within 50 days of election day, a precondition of any coalition arrangement. There will be no deal if there is no stability. No coalition without coming clean with the British people.”
Mr Clegg said the stability budget would also demand extra tax revenue from the wealthy.
“Whether we are in government with Labour or the Conservatives, we will pin them down within weeks of the election and force them to put their cards on the table,” he added.
It is the latest bid by the Lib-Dems to set out red lines beyond which the party would not move in any post-election negotiations. More are expected to follow this week. Yesterday the party said it would rule out an agreement with any rival that did not commit to completely protecting the education and early years budget.
Speaking on education today, Mr Clegg declared: “The next government must increase spending on nurseries, schools and colleges.
“That means education spending must rise with both prices and pupil numbers. Without investment in education, there can be no deal with the Liberal Democrats.
“Neither Labour nor the Conservatives have been prepared to commit to education in the way that we have.”
