WELSH Liberal Democrats launched their manifesto promising a referendum on giving the Assembly tax-raising powers.

Combining a reform of the way Wales is funded with their UK-wide pledge to raise income tax by 1p, the party claim there would be an extra £1.4 million a year for the Assembly - which they would give law-making powers.

Welsh Liberal Democrat leader, Richard Livsey, said: "Welsh Liberal Democrats are campaigning for freedom and justice for the people of Wales. Our policies are radical and ambitious. Above all, we are honest about how we will pay for our promises and who will provide them." But opposition parties were dismissive of their proposals.

Wales Office minister David Hanson said references in the manifesto to achievements by the Lib-Lab coalition at the Welsh Assembly were an attempt to take credit for Labour's work, and he called the manifesto "a bunch of promises that can't be delivered".

He said: "These are the same old pie-in-the-sky promises we get from the Lib Dems at every General Election. Once again they are trying to tell people that 3p into 1p goes.

"This election is about a choice between Labour's investment or Tory cuts. The Lib Dems and nationalists always promise the earth because they know they'll never have to deliver."

Plaid Cymru described it as a "mixed message manifesto". Party chairwoman Elin Jones said: "The Lib Dems' promises for Wales are unsustainable while they continue to follow their New Labour coalition partner's agenda in the National Assembly.

"A commitment to strengthening the powers of the Assembly is meaningless in the context of their New Labour masters' insistence that the status quo must stay.

"Nor is the Lib Dem commitment to reviewing the blunt instrument arithmetic of the outdated Barnett formula credible while New Labour continues to resist the compelling arguments in favour of a needs-based formula."

Speaking at the launch yesterday, Mr Livsey said: "We will re-establish the Assembly as a Senedd - a Welsh Parliament with the same powers as the Scottish Parliament.

"We will also give Wales a fairer slice of the cake by reforming the way money is handed out by the Treasury. This will mean scrapping the Barnett Formula and replacing it with a system based on need.

"Welsh Liberal Democrats offer Wales a real chance for real change. Labour has been a disappointment. William Hague's Tories would be a disaster. Plaid Cymru are an irrelevance at Westminster."

PLAID Cymru leader Ieuan Wyn Jones visited Gwent yesterday and took a trip by canal boat in Cross Keys.

Afterwards Mr Jones joined his party's candidate Leigh Thomas canvassing in Blackwood High Street. Mr Thomas said he was supporting residents in a campaign to restore the canal. He said: "I fully support the residents in Risca and the moves to have it fully restored. I'm confident the council will listen to them."

UK Arts and Culture minister Chris Smith was due to join Huw Edwards on the campaign trail this afternoon, followed by a trip to Blaenau Gwent this evening.

The other parties expect to put the emphasis on rural Wales. With the early emphasis on taxes now subsiding, that could be the next big issue.