The Conservatives have outlined £35 billion of potential annual savings in the government's spending plans.

The party released the final findings of its James review of Whitehall "waste" on Sunday and is set to say how much of that will be put towards making tax cuts in a future Tory administration on Monday.

Party leader Michael Howard said the majority of the cash will be put into frontline public services "without the need for Labour's third term tax rises" while £12 billion will be left over for tax cuts and debt repayments, with £6 billion expected to be put towards each.

Shadow chancellor Oliver Letwin asked business troubleshooter David James to identify potential savings last year, on top of the £21.5 billion per year Gordon Brown expects the government to save by 2008 through its own Gershon efficiency review.

The £35 billion figure includes the Gershon findings and will be made up of the axing of 168 public bodies, 235,000 "bureaucratic" civil service posts, the English regional assemblies, the planned supreme court and the New Deal for the unemployed, among other measures.

Letwin said the review was "the most detailed and extensive investigation of government spending ever undertaken by an opposition party".

"David James and his team have done a brilliant job in identifying wasteful government expenditure," he added.

"They have paved the way for better public services, better value for money and lower taxes."

Delivery

However critics believe the savings are undeliverable, with pledges such as the saving of £897 million through the creation of a "streamlined" and capped immigration system unrealistic.

Both Labour and the Liberal Democrats said cuts would have to come in frontline services.

Chief secretary to the Treasury Paul Boateng said: "None of the Tories' figures add up so they can't make these savings and can't pay for any tax cuts, which means the only guaranteed cut from the Tories is £35 billion of cuts, hitting frontline public services hard."

And Liberal Democrat spokesman Vince Cable said: "The Conservatives are playing fantasy politics with fanciful sums and can no longer be seen as financially disciplined and credible.

"Oliver Letwin has failed to acknowledge that tough choices need to be made in spending. The idea that they can increase spending on health, education, policing, international development and defence, cut taxes and correct any budget deficit by removing waste in the public sector is laughably implausible. 

"The review claims enormous savings but raises serious questions over the impact on front-line services from such enormous cuts in administrative support. Reducing waste and unnecessary bureaucracy must be welcomed but cuts beyond Gershon savings will damage services.

"The only conclusion that can be drawn from James is that Conservatives themselves do not believe they can win the next election and will therefore never actually have to try and meet all these savings."

Tax cuts

But speaking on Sunday Howard said he was determined to "deal with some of the unfair taxes which are bearing so heavily on and unfairly on the British people today".

"Almost every independent expert says if you get another Labour government you are going to have to pay higher taxes," he told the BBC.

"Because borrowing is going up, it is out of control, that is bound to lead to higher taxes or higher interest rates or both.

"So part of the £12 billion we are going to apply to filling the government's black hole, reducing the borrowing.

"The rest will be used to reduce these unfair taxes which are bearing so heavily on the people of our country today."

Letwin will announce at a later date which taxes would be cut when his consultation exercise on the subject  reaches its conclusion.

"We have not come to the end of the road on this because we still have to decide which of these unfair taxes has priority," Howard said, claiming his pledges would be "copper-bottomed guarantees".