A Liberal Democrat government would set in place a new air tax regime designed to cut harmful emissions, the party's environment spokesman said yesterday.

Norman Baker admitted to delegates at the Lib Dem conference that green taxes on aviation would be passed on to passengers through ticket costs.

Conference agreed a range of green measures including tax breaks for households producing less non-recyclable waste.

Councils would also be able to introduce variable charging so that refunds could be given to those who reduce household waste.

Meanwhile, Lord Razzall predicted that the Liberal Democrats would form the next government when the public loses faith with Labour.

Charles Kennedy's top election strategist said: "The significance of Brent East, the significance of Newcastle upon Tyne, the significance of Leicester South is that the Conservative Party is finished as a serious challenger for government in our adult lifetime."