Election fight over living standards

David Cameron said the Conservatives were running on a "record of economic success"

The Conservatives and Lib Dems have heralded pre-election figures showing rising household incomes as proof that their economic strategy is working.

Disposable incomes per head were up 1.9% at the end of 2014 against a year earlier and 0.2% higher than when the government came to power in May 2010.

Chancellor George Osborne said it was part of a "hat-trick" of good economic news, allied to stronger GDP growth.

But Labour said working families were "struggling" as incomes were squeezed.

The latest bulletin on the state of the UK economy from the Office for National Statistics is the last to be published before the general election on 7 May, in which economic management and living standards will be crucial issues.

In the other main developments on day two of the official election campaign:

• Plaid Cymru leader Leanne Wood called for £1.2bn in extra annual funding to "unleash the economic potential of Wales" as it published its manifesto
• The Lib Dems promised to spend an extra £3.5bn on mental health while Labour said it would cut corporation tax for small business in its first Budget
• David Cameron defended plans to cut a further £12bn from the welfare bill and refused to rule out taxing disability benefits after Chancellor George Osborne said there would no further details before the election
• The Conservative leader also defended the number of personal attacks on Ed Miliband, saying he "makes no apology for putting Labour on the table"
• UKIP leader Nigel Farage accused David Cameron of making a "sham promise" on immigration at the last election

Official figures published on Tuesday showed British households were slightly better off in the fourth quarter of 2014 than they were when the coalition came to power.

The government's preferred measure - real household disposable incomes per head - was 0.2% higher in the final quarter of 2014 than in the second quarter of 2010.

It came as figures for economic growth in 2014 were revised upwards to 2.8% and separate indicators suggested economic confidence was at a 12-year high.

In response. Mr Osborne tweeted: "Hat trick of good news just out from ONS: GDP revised up, consumer confidence up, living standards up."

'Hard-earned'

And Lib Dem Treasury Minister Danny Alexander said it was a vindication of the party's influence on their Conservative coalition partners.

"Handing back control of our economy to either Labour or the Tories in government on their own in this election will put all this hard earned progress at risk," he said.

But shadow chancellor Ed Balls, speaking at a campaign event in Swindon, said Conservatives were "telling people you have never had it so good" despite it being the "slowest recovery for 100 years".

"This is a government which has presided over five years when wages have not kept pace with rising prices and family bills," he said.

Labour's Ed Balls said it had been the slowest recovery for 100 years

Plaid want to use their influence in a hung Parliament to get more funding for Wales

"George Osborne and David Cameron want to spend the next six weeks going round the country saying you are better off.

"I say 'bring it on' because working people are really struggling in our country and we can do better than this."

Policy guide: Economy

This issue includes the wider economy and deficit reduction but also employment and the role of business.

The second day of official campaigning has seen a flurry of pledges on jobs, tax and health, with the Lib Dems saying their manifesto would commit them to increasing total spend on mental healthcare to £3.5bn over the next six years.

This would include £250m over five years for new services for mothers suffering from depression and to help reduce waiting times.

Full BBC Election 2015 coverage

Equality for people with mental health issues is a "liberal mission", leader Nick Clegg said, adding the party would "make sure mental health is treated with the same urgency as physical health, with money to back that up, and challenge the stigma every day".

Pollwatch

David Cowling, editor, BBC Political Research

Following the flurry caused by YouGov's 4% Labour lead this Sunday, we had three polls on Monday telling a different story. Populus had Conservative and Labour tied on 34%; Ashcroft had a 2% Conservative lead (36% versus 34%) and ComRes had a 4% Conservative lead (36% versus 32%).

Among all four polls, the average Lib Dem rating was 8%, UKIP's was 13% and the Greens at around 6%. We've barely started our long road to 7 May but perhaps this campaign will develop into a battle of methodologies - telephone versus internet polls.

The two telephone polls (Ashcroft and ComRes) had the highest Conservative ratings - 36% each; and the two internet polls (YouGov and Populus) had the lowest - 34% and 32%. YouGov represented a 5.5% swing from Conservative to Labour, enough to give Labour a majority: ComRes suggested a 1.5% swing to Labour, barely a ripple on the election pond.

BBC Poll tracker

Conservative leader David Cameron said the party was focusing on their "positive vision" for the country amid criticism about the frequency of his attacks on the Labour leader Ed Miliband in recent days.

He said the UK could create two million more jobs by 2020 - similar to the 1.9 million created in the last Parliament under the coalition - exceeding independent forecasts.

"We have kept tax low for business, we have encouraged people to invest in our country, we have invested in skills, we have trained two million apprentices in this Parliament," he told BBC Breakfast.

However, Mr Cameron said he would not stop making Labour's tax and spending plans an issue, saying the opposition had "not even reached base camp" in terms of setting out their deficit reduction plans.

Labour has been highlighting its existing plan to cut business rates for small business properties and then freeze them by promising to take action in his first Budget.

The party says the measure would save businesses an average of £400 and would be funded by cancelling a planned cut in corporation tax for large companies planned by the Conservative-Lib Dem coalition.

"This is the right priority when money is tight," Mr Balls said. "And it will mean that the tax burden on small businesses will be lower with Labour than under the Tories."

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