Nick Clegg hints he could work with Labour

Liberal Democrat leader Nick Clegg indicated today he would be prepared to support a Labour Party which had slumped to third in the share of the vote - but he would not let Gordon Brown retain the keys to No 10.

With opinion polls pointing to a hung Parliament, Mr Clegg said it would be "inexplicable" for Mr Brown to remain as prime minister if his party had finished with fewer votes than the Tories or Lib Dems, even if Labour had the most seats.

But he said he would be prepared to work with anyone else within Labour or any other party who was prepared to deliver his aims, including electoral reform which is an "absolute pre-condition" for renewing British politics.

Speaking on a visit to Lady Haig's Poppy Factory in Edinburgh, Mr Clegg said he would co-operate with whoever was prepared to offer fairer taxes, a shake-up of the education system, economic reform and wholesale changes to Westminster politics.

Under political convention, Mr Brown would be offered the chance to form a government in the event of a hung Parliament following the May 6 General Election.

But Mr Clegg told the Press Association: "I think, if Labour do come third in terms of the number of votes cast, then people would find it inexplicable that Gordon Brown himself could carry on as Prime Minister, which is what the old convention would dictate."

He went on: "As for who I'd work with, I've been very clear - much clearer than David Cameron and Gordon Brown - that I will work with anyone, I will work with a man from the moon, I don't care, with anyone who can deliver the greater fairness that I think people want."

Put to him that he would work with the "man from the moon but not Gordon Brown", he said: "I don't think Gordon Brown - and I've got nothing personal about him - I just don't think the British people would accept that he could carry on as Prime Minister, which is what the convention of old politics dictates when, or rather if, he were to lose the election in such spectacular style."

In an interview with Sky News Mr Clegg was pressed on whether he would be prepared to work with alternative Labour figures such as Alan Johnson or David Miliband.

He said: "I will seek with whomever else to deliver those big changes that I want, in the way the economy is run, the way the tax system works, the way our education system works and, of course, cleaning up politics from top to toe."

Home Secretary Mr Johnson yesterday went further than any senior Labour figure in suggesting his party would be ready to open up a debate on proportional representation (PR) for Westminster elections.

At a press conference in Edinburgh Mr Clegg was asked whether the Lib Dems would "hold the country to ransom" by withholding their support unless they got a proportional voting system.

He said: "My position is, because of the eccentricities and unfairness of the electoral system, which has now become more obvious than ever before, I think electoral reform is a first step which any government of whatever composition needs to introduce to start restoring public trust in the political system."

He added: "I don't think after this election it will ever be possible to put the genie back in the bottle.

"Electoral reform is an absolute pre-condition for renewal in this country."

Tory leader Mr Cameron this morning avoided making an explicit commitment to preserving the first-past-the-post system for Westminster elections.

But he made it clear that he did not want to ditch the voting method and made it more difficult for himself to cut a post-election deal with the Lib Dems by saying a change to PR would be a "big, big mistake".

Mr Clegg told the BBC: "It's quite clear that David Cameron wants to set his face against any serious change in our politics."

A senior Lib Dem source said the decision to demand the head of Mr Brown in exchange for support was taken in response to polls indicating that Labour could have the most seats even if they received fewer votes than the other two main parties.

The source said the Lib Dems had now made clear their position in two possible scenarios after the votes had been counted.

They have previously said a party with the greatest number of seats and the greatest number of votes would have the first chance to form a government either on their own or with support.

The Lib Dem source said: "What we suggest to David Cameron and Gordon Brown is that they should set out what they intend to do if no party has an overall majority."

The party would not necessarily require Cabinet posts in exchange for support in a coalition government.

"We have said all along this is about political priorities, not bums on Cabinet seats," the source said.

Mr Clegg earlier outlined some of the big political divides between his party and their main rivals.

At a press briefing in Edinburgh, he said the Lib Dems' core principle was to "put money back into people's pockets" so there was an incentive to work.

"A big ideological difference there, of course, with the Labour Party," he said.

"The Labour Party thinks the only way to deal with poverty is to encourage people to become ever more over-dependent on an ever-more complex system."

And he hit out at the Tories' plans for the economy, saying: "The Conservatives' proposal to start pulling the rug out from under the feet of the British economy from day one is such a daft idea ...

"It will only increase the risk of a double-dip recession and only increase the difficulty of the task of dealing with the deficit in the long run."