'We're bankrupt, broken and bust': Cameron unveils radical blueprint to rebuild Britain after 13 years of Labour

Clegg wins referendum on change to Alternative Vote

But Tories ensure stronger line on immigration



Cameron also restores pledge to bring in 'lower taxes'



Parents and charities will be given power to run schools



ID cards to go as Labour's Big Brother state is slashed



Unions angry at plans to part-privatise Royal Mail



David Cameron pledged to rebuild Britain after 13 years of Labour 'recklessness' today after unveiling a radical blueprint for sweeping political and social reform.

The Prime Minister launched a savage attack on the previous administration, accusing them of leaving the country in tatters with their economic profligacy.



In his address following this morning's Queen's Speech, he accused Labour of leaving an 'economy that's nearly bankrupt, a society that's broken and a political system that is bust'.



Mr Cameron said Labour had left an 'appalling legacy' with a vast budget deficit that is bigger than Greece's and vowed his coalition government would act in the national interest to put it right.



Evoking the rhetoric of Margaret Thatcher, he promised to return Britain to 'good housekeeping' and end the years of 'recklessness and big government' that mushroomed under Labour.



He claimed his reforms, which include allowing people to run their own schools and a rolling back of the state, would hand back power to the people and deliver a new start for Britain.



'In just two weeks, this Government has done more for our economy than Labour managed in the last two years. No more spending beyond our means, no more reckless borrowing, no more taxing of the poorest to pay for the mistakes of the few,' he told MPs in the Commons.



Foot power: David Cameron and Nick Clegg walked to Parliament from Downing Street

Pomp: The Queen and the Duke of Edinburgh in the House of Lords for yesterday's State Opening

But in a sign of struggles ahead, the Prime Minister faced angry questions over the axing of Child Trust Funds, the omission of a vote on the Hunting Ban from the Queen's Speech and attempts to shore up the coalition by blocking dissolution of Parliament unless 55 per cent of MPs agree.



Acting Labour leader Harriet Harman taunted Mr Cameron over divisions with the Liberal Democrats over Europe and branded the '55 per cent rule' a 'political pre-nup'.

Today's legislative programme showed Nick Clegg's party has secured huge gains in return for shoring up the Tories in government.

At its heart are measures for drastic electoral reform and a referendum on changes to the voting system that would change politics forever - satisfying major Lib Dem hopes.



A Bill on electoral reform outlines a bid to give the public the right to decide whether the First-Past-The-Post system should be ditched in favour of the Alternative Vote.



It was one of 22 Bills and one Draft Bill in the speech, which laid out a 500-day 'power to the people' legislative programme for the new coalition government.

The joint programme, hammered out in just two weeks, outlines plans to allow people to run their own schools and to row back the state that mushroomed under Labour.

But in a sign Mr Cameron has clawed back some ground from Mr Clegg, the document declares that the Government believes in 'lower and simpler taxation' and takes a stronger line on immigration.

It restates the Tory leader's pledge to bring non-EU migration down to levels last seen in the 90s and sticks to plans to have an annual cap on numbers flooding into Britain.



Packed: Peers in their ermine fill the benches of the Lords as the Queen delivers her address

Ceremony: It was the 56th time the Queen has travelled to Parliament for a State Opening

The sovereign, from her throne in the House of Lords with Prince Philip at her side, said the measures were based on the principles of 'freedom, fairness and responsibility'.



Amid all the pomp and ceremony of the most elaborate day in Parliament's calendar, the address starkly insisted: 'The first priority is to reduce the deficit and restore economic growth.'

Mr Cameron and his Deputy, Liberal Democrat Nick Clegg, had walked together from Downing Street to the Commons - again ignoring security fears to tread the streets with the public.

It was the monarch's 56th Queen's Speech but her first for a coalition government and the first with a Tory as Prime Minister for 14 years.



The address lasted 10 minutes - more than three minutes longer than Gordon Brown's final Queen's Speech delivered just last November - and made no mention of the power-sharing set-up.

Mr Cameron's pregnant wife Samantha watched from the gallery above the Lords. She had dressed down in a casual blue dress and white vest top and was not wearing a hat.

Expecting: Samantha Cameron rests her hands on her baby bump

The number of Bills reflects the fact that this Queen's Speech programme will run until autumn 2011, rather than the usual 12 months, because of the election.

It was still slightly briefer than Tony Blair's first Queen's Speech in 1997, which included 26 bills, and Gordon Brown's in 2007 which had 29.



The plans add up to a radical shake-up of education and fundamental political reform. Plans to liberate hundreds of schools from state control by allowing them to become academies are a priority.



Charities, businesses and even groups of parents will be invited to set up and run new 'free schools' using taxpayers' money.

The move will smash the state monopoly on education forever and threatens to pitch the Lib-Con administration into a battle with the educational establishment and trades unions.



It is the first measure in a 'big society' programme designed to 'take power away from politicians and give it to the people'.



Other plans include introducing a national citizen service programme for 16-year-olds, a shakeup of the planning system to give communities more power, letting public sector workers take over services and run them as cooperatives and giving the public access to government data.



The Parliamentary Reform Bill, meanwhile, will give voters the right to force by-elections to get rid of corrupt MPs, force the Commons to debate particular subjects via petitions, reduce the number of MPs and introduce fixed-term Parliaments.

THE COALITION'S PROGRAMME

Academies Bill Airport Economic Regulation Bill Armed Forces Bill Decentralism and Localism Bill Education and Children's Bill Energy and Green Economy Bill Equitable Life Payments Scheme Bill European Communities (Amendment) Referendum Lock Bill Financial Reform Bill Freedom (Great Repeals) Bill Identity Documents Bill Health Bill Local Government Bill National Insurance Contributions Bill Office of Budget Responsibility Bill Parliamentary Reform Bill Pensions and Savings Bill Police Reform and Social Responsibility Bill Postal Services Bill Public Bodies Bill Scotland Bill Terrorist Asset Freezing Bill Welfare Reform Bill Parliamentary Privilege (draft)



A Great Repeal Bill will enact Tory and Lib Dem promises to 'roll back the state' that built up under Labour, scrapping ID cards and limiting the use of CCTV and of DNA databases.

The Government also promises to ensure anti-terror legislation 'strikes the right balance between protecting the public, strengthening social cohesion and protecting civil liberties'.

The first piece of legislation to be introduced by the Government tomorrow will be the Academies Bill, following by the Identity Documents Bill on Thursday.



All existing state schools will be invited to convert to academy status, including primary schools for the first time.



Education Secretary Michael Gove predicts that hundreds and even thousands of schools will take up the offer, with the first wave doing so in September.



John Dunford, general secretary of the Association of School and College Leaders, said: 'The danger is that this could break up the system, with the better schools having more money and greater independence and the other schools finding life more difficult. We must avoid that polarisation of the system because the people who suffer in that situation tend to be the disadvantaged.'



Separate legislation will follow to allow charities, businesses and community groups to acquire and convert land and buildings as premises for 'free schools'.



In Sweden, which has adopted a similar programme of schools reform, many new schools are located in office blocks but are hugely popular with parents who recognise the exceptional quality of teaching.



Other key Bills in the Queen's Speech include a Pensions and Savings Bill, restoring the link between the state pension and earnings, and a European Bill requiring a referendum before any future transfer of powers to Brussels.

Acting Labour leader Harriet Harman warned that the public must not be left to bear the cost of holding the coalition together and was sceptical about how long it would last.

'While the happy couple are enjoying the thrill of the rose garden, the in-laws are saying they are just not right for each other,' she said.



'We keep telling them you can't pay couples to stay together and it's clear it will take more than £3 a week in tax breaks to keep this couple together.'



She highlighted conflicts between the two parties on the economy and on Europe and pointedly praised Mr Clegg for the 'ease' with which he has secured plans for electoral reform.



Miss Harman also laid down the gauntlet over plans to make it impossible for Parliament to be dissolved unless 55 per cent of MPs agree.



'If Government loses confidence of parliament even by one vote than that Government has lost its mandate and there must be the opportunity for fresh elections,' she said.



'They are already preparing for the day when they shrink back from their loveless embrace. It's like a a political pre-nup... They have no mandate for that change.'



She attacked the Government for outlining its £6.2billion in cuts outside Parliament but pledged to back measures to 'embed and secure' the economic recovery.



However, Labour would not allow firms to be left to 'sink or swim', she warned, and declared slashing extra university places in half would blight youngsters prospects.

A poll last night suggested the coalition is enjoying strong levels of public support.



The first ICM poll for the Guardian since the election shows that overall, 59 per cent of voters approve of the new government and 32 per cent oppose it.



Travelling in style: The Queen arrives at the Houses of Parliament for the State Opening

And she's off: The Queen leaves the Houses of Parliament after the brief ceremony

Electoral Reform

The coalition's plans amount to a radical shake-up of Parliament and the electoral system. They will be overseen by Deputy Prime Minister Nick Clegg and are aimed at transforming politics.

A Bill will allow for a referendum to choose between the First-Past-The-Post system and Alternative Vote, which will see the Tories and Lib Dems campaigning for opposite sides.

Under AV, candidates are listed in order of preference by voters and need 50 per cent to win. Votes are divvied up again and again until that threshold is reached.

The legislation will provide for the system to be changed automatically if there is a 'yes' for a change, with no need for further laws.



Parliamentary terms will also be fixed for five years, with the date for the next general election set for May 7 2015. This strips David Cameron of the Prime Minister's right to call an election.



Parliament will only be dissolved earlier if there is support of 55 per cent of MPs in the Commons - a proposal that has already prompted a revolt amid claims it will create a 'zombie' government.

The Boundary Commission has been asked to draw up new plans for equally-sized constituencies with fewer MPs.

Voters will also be given the right of recall over an MP who is found guilty of serious wrongdoing as long as they can get 10 per cent of electors to sign a petition.



Education

Finery: Lord High Chancellor Ken Clarke

A furious row has erupted over fears the coalition government is attempting to smash the power of teaching unions and local authorities.

Thousands of outstanding schools in England could become academies and opt out of local authority control, under plans announced in the Queen's Speech.



The Academies Bill allows for a massive increase in these schools - from the current 203 to as many as 3,000.



Primary and secondary schools graded outstanding by Ofsted could be fast-tracked into free-standing academies by this autumn.



However, academies are free to depart from existing agreements on teacher pay and conditions and unions privately fear their large-scale expansion will mean the end of the national pay system.



Dr Mary Bousted, general secretary of the Association of Teachers and Lecturers, described the academy plans as 'irresponsible'.



She warned that the proposals had not been 'properly thought through' and would 'end up making a mess of education provision'.



She said: 'Cutting local authorities out of the equation will end any meaningful local planning to target funding to the children who need more help such as those with special needs.



'If academies are allowed to determine their own pay and conditions, this will create uncertainty for staff and could make it even harder for the most deprived schools in the toughest areas to recruit staff.'

The Queen's Speech also signalled the removal of barriers to new providers setting up 'free schools' within the state system.

This would allow parents, businesses and charities to apply directly to the Government to set up schools, which would also be independent from local authorities.



These privately-run schools would be allowed to compete for pupils at the taxpayers' expense to create more local competition and drive up standards. It would also allow these schools to break with national pay and conditions.



Education minister in the coalition, Sarah Teather, a Liberal Democrat, had attacked the free school plan last month as a 'shambles'.



She said during the election campaign: 'Unless you give local authorities that power to plan and unless you actually make sure that there is money available...it's just a gimmick.'



Royal Mail

Unions have promised to wage a ferocious campaign against Government plans to sell off a 49 per cent in Royal Mail.

The militant Communication Workers Union said it will 'fight' the proposal which will see a large stake in the State-owned former monopoly sold to the private sector.



Under the controversial plans, Post Offices will be protected. They will not be included in the sale and will remain in public ownership.



Workers at the Royal Mail, one of Britain's biggest employers with nearly 170,000 staff, will also be handed a large stake in the business.



The full pledge is that the Government will 'modernise the Royal Mail, in partnership with employees, and will ensure it benefits from private sector capital and disciplines.'



But union bosses are furious about the planned sale, which was a key pledge in the Liberal Democrat manifesto.



Billy Hayes, general secretary, said: 'We will fight these proposals. There is no mandate from the public to privatise Britain's postal services. It is not supported by the public and it is not supported by postal workers.'

The union insisted strikes are unlikely because they say it would be highly unusual to ballot its members about the ownership of the company.

A motion passed at its annual conference in Bournemouth this week agreed to oppose the part-privatisation, but not to strike over the controversial issue.



Business Secretary Vince Cable said there was no option but to deal with the 'long-standing problems' facing the business.

Many different problems face the company from the plunge in the number of letters being sent, down 13million a day in just five years, to the £10billion pension black hole.



Mr Cable said: 'We are looking at all of the issues and options with a fresh pair of eyes, but are clear that an injection of private capital is important.'



The move comes less than two years after Labour tried - but failed - to sell a stake in Royal Mail, a move which triggered massive opposition from the party's own MPs and the postal union.



Gate trouble: Education Secretary Michael Gove and Chief Secretary to the Treasury David Laws both had difficulty getting into Downing Street for today's Cabinet meeting ahead of the State Opening



Immigration

The Torie' pledge to put a cap on immigration from outside the EU, which survived the coalition negotiations, is enshrined in the Queen's Speech.

The issue was one of the key areas of disagreement between the Conservatives and Liberal Democrats before they struck their historic power-sharing deal.

Nick Clegg's party had wanted a regional points-based system, but eventually conceded that the Tory manifesto pledge should stay in the Government's programme.

On the benches: Baroness Thatcher in the Lords

In today's address, the monarch said: 'My Government will limit the number of non-European Union economic migrants entering the UK and end the detention of children for immigration purposes.'

Notes attached to the speech set out the coalition's ambition for net migration to be 'tens of thousands not hundreds of thousands'.

Although the UK needs to attract the 'brightest and the best', immigration 'is too high', the briefing said.



'In the long-term we should up-skill British workers so that we do not need as many economic migrants to fill jobs,' it said.

Final decisions on the level of the annual limit and how it will be implemented will be taken after consultation with business and 'other interested sectors'.

Immigration Minister Damian Green will also lead a review of how to end the widely-criticised practice of detaining children for immigration purposes, which will put forward proposals in the coming months.

Tax

The Queen's Speech promises a 'fairer and simpler' tax and benefits system, which is another key victory for the Liberal Democrats.

Key Tory plans have been ripped up to fund the Lib Dem pledge to raise income tax thresholds to help the lowest earners.



Plans to curb the 1 per cent National Insurance hike for employers and employees has been watered down and will now still hit workers.



And capital gains tax on non-business assets such as second homes and shares will be drastically hiked to rates close to income tax levels.



The first 'significant' increase in the income tax threshold will be unveiled in the Budget on June 22, with the long-term aim to raise it to £10,000.



The Government insists most people will be better off under the combined tax measures, despite the middle class feeling the pinch.

