Liberal Democrat party faces cash woes

First they had to stomach a coalition deal with the Tories. Now the Liberal Democrat grassroots must swallow a 15 per cent rise in membership fees to raise £100,000 for an electoral fightback.

The party's federal executive warns that entering government has triggered "new financial challenges". A senior party source said failure to retain the "Short" money paid to opposition parties was a "major cock-up" of the coalition negotiations. "The party faces considerable financial difficulties in the coming year unless it attracts one or two major donors," the source added.

Some 20 staff were laid off from the party's HQ after the election, while an emergency conference to rubber-stamp the coalition deal cost more than £100,000. With polls showing a major slump in Lib Dem support, officials fear a bloodbath at elections to the Welsh Assembly, Scottish Parliament and local councils next May.

Under the fundraising plan, the recommended annual subscription will hit £60 – up from £52.

Electoral Commission figures show the Lib Dems received £6.4m in 2009 but spent £6.6m. Their Tory partners spent £37.1m.