A vision for change, with price tag attached

The gimmicks have to stop and some hard cash has to be injected into education; We must experiment with citizens' initiatives and local referendums

Paddy Ashdown previews Liberal Democrat plans for national renewal - plus costings - to be unveiled today

I have a nightmare. That even if the nameplate on No 10 changes, nothing else does. Our political system remains rotten and stuck in the past. We go on postponing key investments in education and ignoring the challenge of pollution and the degradation of our environment. We remain ambivalent and hesitant on Europe. Our economy continues to be dogged by short-termism and a failure to invest. Poverty deepens, divisions widen, the failures continue.

That is what will happen if opposition politicians sit back and wait for the Conservatives to lose the election. Instead, Britain needs a clear, alternative vision of how this country could be after this government - and clear, costed policies about how we get there.

Twice before during this century there have been moments of great progressive change. In 1906 Liberals led a broad coalition for change in the first great, radical reforming government of the century. And in 1945 it was the ideas of Liberals like Beveridge and Keynes which helped to drive the agenda that reshaped our society and rebuilt the country after the devastation of war.

Britain is now once more at a moment when it must change. But there are three big obstacles - the continued failure to invest in people, our rotten, outdated, discredited political system and this country's permanent inability to look longer term.

Take education. Yesterday there was another pair of speeches from John Major and Tony Blair on the importance of education. But if we really want to make Britain one of the world's most skilled societies, there comes a point when the platitudes and gimmicks have to stop and some real hard cash has to be injected into the system.

Obviously there is more to an education policy than extra resources. There is a whole raft of things that could and should be done to raise standards and increase opportunities - from a new General Teaching Council to a modular 14-19 curriculum, breaking further the damaging academic- vocational divide in this country.

But the only way to provide pre-school education for all three- and four- year-olds is with hard cash. The only way to reduce class sizes is with hard cash. So let's break the great tax taboo that now hangs like an albatross around the neck of sensible political debate in Britain - and get real.

Today the Liberal Democrats will lay out some clear, specific commitments. We will promise pre-school education for every three- and four-year-old, guaranteed training for everyone between 16 and 19, and opportunities for everyone to retrain at some point in adult life.

Most importantly, we guarantee the investment to make the promises a reality - pounds 2bn extra, to be precise. And if we need to ask people to pay an extra penny on income tax to pay for it, we will do so.

Similarly, any serious approach to protecting Britain's environment is going to mean implementing some tough policies. Cars are already the major cause of pollution in Britain, and their numbers are likely to double in the next 30 years. We can't go on ignoring the problems caused by congestion and pollution on our roads - from ill health to environmental degradation to an economic cost to business of pounds 12bn a year.

A new approach to transport in this country would build for the long term. It involves financial incentives for more fuel-efficient cars and road pricing in our congested cities, investing the money raised into high-quality public transport. The funds set aside for more motorways would be diverted into investment in our railways. And we must retain public control of Railtrack as the cornerstone of the integrated transport network this country needs.

At the heart of this agenda is a historic shift away from taxing the things we want more of - like jobs - and on to taxing things we want less of - like pollution and the use of finite natural resources.

There will be losers. But as the Dahrendorf commission concluded in July, "by restricting attention to policies which make nobody worse off, we close off almost all options".

The country cannot go on like this. The crucial point is that in the long run we will all be winners from progressive, environmentally sustainable change - with better transport, less congested roads, cleaner air and healthier cities.

Finally there is our shambles of a political system. People are losing faith in the process of government - maybe even in democracy itself. Reform is now more necessary than ever - but the challenge is greater. It's not just a question of modernising our political system, it's a matter of restoring trust in politics, too. A Freedom of Information Act is the first essential: to throw back the veil of secrecy shrouding the British state and open up government. A Bill of Rights will protect individuals from the arbitrary power of governments and the tyranny of the majority. Parliament itself must be dragged into the 20th century with root-and- branch reform of procedure and practice.

But more than this, Britain's over-centralised state must be broken up, so we can give people real power and autonomy in our local communities. That involves reining in the power of the quango state and making the swollen ranks of appointed placemen more accountable, with open meetings, declarations of interests and a more transparent system of appointments. And it's why we must experiment with new instruments of democracy such as citizens' initiatives and local referendums, which put power directly into the hand of the citizen.

And lastly, it's why we need electoral reform - fair votes - so that Britain never again returns to the arrogance and abuse of minority Tory power at Westminster of the past 17 years - or to the arrogance and abuse of minority Labour groups in communities from Lambeth to Liverpool.

The Liberal Democrats are laying down today what is necessary to put Britain right - and we are setting out concrete, costed commitments about how to do it. Investing in people, cleaning up the mess of our politics, looking longer-term - these are the three priorities. But one thing is clear - Britain has to change. From now until the election, Liberal Democrats will argue that clear, positive case for change.

The writer is leader of the Liberal Democrat Party.