What the parties will mean for your pocket

You can tell an election campaign is in full swing when the parties start accusing each other of having "hidden" agendas, plans to increase taxes or secret policies on cuts in public services.

What they don't always spell out is how their manifesto pledges will affect your personal finances. So in order to separate fact from fiction, here is how the three main political parties' policies on tax, individual savings, pensions and childcare stack up.

TAX

Along with immigration, public services and the Iraq war, tax is one of the main battle-grounds for the 2005 general election. Most economists believe that Gordon Brown, the current chancellor, is over-optimistic about his budget forecast and suggest that the amount of tax receipts in the coming year will be insufficient to meet the cost of his public spending commitments.

As a result the Conservatives and Liberal Democrats have been focusing on public fears that a Labour third term would mean a rise in taxation - whether directly through income tax or indirectly through "stealth taxes" such as VAT and a rise in national insurance.

Labour: The Conservatives have been accusing Labour of planning stealth taxes, including raising the rate of national insurance. Labour has so far not made a commitment not to raise NI, although it claims it will be able to continue with its spending on public services without increasing the tax take. The threshold at which inheritance tax - which hits middle England particularly hard - is paid was raised in the budget, but it is unlikely to be scrapped.

Conservatives: The Tories are playing the "lower taxes" card and promise ?2.7bn of tax cuts if they win the election. The party has also pledged to raise the stamp duty threshold on residential house purchases to ?250,000, from the current level of ?120,00. A move it claims will mean 80% of homebuyers won't pay any stamp duty at all.

Liberal Democrats: Their proposals to tax the richest 1% of the population - those earning more than ?100,000 a year - at a rate of 50p in the pound are unlikely to win them friends among the high rollers but could be popular with other voters. They also plan to replace council tax with a local income tax based on income rather than property price.

PENSIONS

Growing "grey power" pressure has forced all three main parties to think about their policies for older people. Many older people object to the high rates of council tax and all the manifestos include sweeteners to woo retired voters.

Labour: A pledge to pay ?200 in winter payments to all council tax-paying households which include someone aged 65 or older. The pension credit, aimed at low income pensioner households, to be increased with earnings.

Conservatives: The Tories have promised to increase the basic state pension in line with earnings and to reduce pensioners' council tax bills by up to 50%, which they estimate will cost ?1.3bn and form part of the ?4bn fund earmarked for tax cuts.

They have also promised to add ?10 to every ?100 paid into a private pension, using ?1.7bn of the ?35bn saved under the party's James review of public spending. They claim that this initiative, which would start next April, would enhance the average worker's eventual pension by around ?500 a year in retirement. Current figures show that around half the workforce is not paying into a pension fund.

Liberal Democrats: There is a proposal to introduce a citizen's pension, which would be linked to earnings. Employees would choose to opt out rather than opt in to an occupational scheme, and the requirement to buy an annuity by 75 would be removed.

The Liberal Democrats have also pledged to provide free personal care for the elderly, a benefit which Scottish pensioners already enjoy. This covers nursing care but not the cost of accommodation in a residential home.

SAVINGS

With the rise in property prices, many people are feeling well-off and have released equity from their homes. However, independent analysts have warned of a growing credit culture where few younger people are bothering to save and each household is thousands of pounds in personal debt.

Encouraging saving for the future is a big issue for all the parties, as the increasing number of older people in the population means that the strain on the basic state pension will become greater over the next decade.

Labour: Gordon Brown has indicated that he will keep the individual savings account (Isa) and maintain the current investment levels of ?7,000 maximum investment a year, including up to ?3,000 in cash, at least until 2010.

The child trust fund (CTF) has been launched this year, providing every child born since September 1 2002 with at least ?250. The poorest households will receive ?500 to invest in their CTF. The CTF is designed to encourage young people to start saving early, and the chancellor has indicated that a further top-up of ?250 at age seven is under consideration.

Conservatives: It's possible that under the Tories the Isa limit would be increased to ?9,000. The party has said it wants to create a savings culture and encourage individuals to make greater savings provision. This could include a "lifetime savings account", under which the government matches contributions up to a set limit.

Liberal Democrats: The Lib Dems have said publicly that they think the chancellor's child trust fund is a "gimmick" and a waste of money. They would scrap it and use the money instead to provide services for children's early years education and support and to reduce class sizes at school.

CHILDCARE

Hardworking young families are one of the main targets for the three parties and all have policies to woo parents, particularly mothers. However, their philosophies differ greatly.

Labour: Gordon Brown is particularly keen on extending the child trust fund. As well as government payments made at birth and at age seven, there may also be provision for the child's teenage years.

There is a pledge to provide 15 hours a week of free childcare for all three- and four-year olds. Paid maternity leave would be extended from six months to nine months from April 2007, with the aim of extending it again to 12 months by the end of the next parliament. Mothers could transfer some maternity pay and maternity leave to fathers.

Conservatives: The Tories have said that maternity pay would be increased by ?1,400 per mother if they were in government. This would be taken in six months or spread over nine months, from 2007. The Tories have also said they would encourage the establishment of workplace nurseries through ?10,000 start-up grants.

Liberal Democrats: New mothers would be given ?170 a week for the first six months after the birth of their first child.