The Conservatives have set out their tax and spending plans as part of the build up to the general election.

If elected, more money would be diverted to frontline services and cutting taxes the Tories said.

Under the proposals - which were immediately dismissed by Labour - tax thresholds could be raised to take more people out of income tax, and stamp duty could be cut or eliminated for people joining the property ladder.

Party leader Michael Howard said that £23 billion of the £35 billion of savings that the Conservatives say have found in Whitehall bureaucracy would be redirected to priorities such as cleaning hospitals and recruiting an extra 40,000 police.

The plans release £8 billion for cutting government borrowing and £4 billion for tax cuts - which would be implemented in their first year of a Tory government.

The Conservatives also announced plans for a referendum on the Welsh Assembly with three options - the status quo, an increase in its powers or abolition with extra MPs as compensation.

"By cutting government down to size, we can ensure that the forgotten majority keep more of the money they work so hard to earn," Howard said.

Some £5.9 billion from the sale of government buildings has been reserved for redundancies for the 235,000 government workers to be axed.

The Conservatives would also abolish six government units and 162 quangos in order to save £4 billion.

Alistair Darling, the transport secretary, said the claimed savings did not stand up to scrutiny.

Meanwhile, Robert Jackson, the former Conservative MP for Wantage who defected to Labour over the weekend, says today there is no demand for tax cuts among the public.

Writing in The Times, Jackson says the Tories envisage tax cuts without any credible alternative policy for public service investment.

Today's Mirror also claims that Howard had to be talked out of resigning by his wife last autumn after a series of poll setbacks.