Government in secret talks with Liberal Democrats over voting reform

Secret talks between the Government and the Liberal Democrats over reforming the voting system have begun in a move which could see the abolition of the first-past-the-post method of elections.

Charles Kennedy, the Liberal Democrat leader, said his party has held preliminary talks with the Labour Party about establishing a proportional representation system.

Mr Kennedy told The Independent that his party has held "informal discussions" and has been assured that Labour will hold a review after the European Parliament elections in June next year. He said he was confident that the rethink would take place before the next general election.

The review is expected to be co-ordinated by the Department for Constitutional Affairs, which is headed by Lord Falconer of Thoroton, the Secretary of State and a personal friend of the Prime Minister.

Mr Kennedy said: "We had some informal discussions. It's on their agenda. I don't detect that they are going back on the commitment. Once we get beyond the European ones [elections] this year that will be the time to look at the whole thing in the round, ahead of the next election."

News of the rethink will infuriate some Labour MPs and union activists who had assumed the issue was off the agenda. The introduction of proportional voting would lead to more Liberal Democrat MPs and it could stop Labour winning an outright majority.

Labour promised a review of the voting system in its 2001 election manifesto. The revival of talks between the two parties will raise fresh speculation that Mr Blair has not ruled out a coalition if the Labour majority is cut at the next general election. The issue was discussed behind the scenes before the 1997 election but ruled out after Labour won a landslide. A merger was secretly discussed with Paddy Ashdown, the former Liberal Democrat leader.

A spokesman for the constitutional affairs department declined to comment.