Tory proposals put taxpayer at risk

Conservative Party proposals to offer a £50 billion loan guarantee scheme will put taxpayers at risk, according to the Liberal Democrat treasury spokesperson Vince Cable.

Last week, shadow chancellor George Osbourne called on the government to back the plans to avoid printing more money.

However, Mr Cable said the move is "rather bizarre" as it would potentially expose taxpayers to vast open-ended liabilities.

Mr Cable said that loan guarantee schemes already play a part in the British economy and that they have their uses.

"But it must be absolutely clear that this is not a mechanism for shifting all the risks of doing business and making bank loans onto the public purse," he added.

Last week, the Liberal Democrats claimed that the cost of credit is not a problem for the majority of borrowers.

They said it was the unwillingness of banks to lend that was preventing first-time buyers getting onto the property ladder.