Peter Hain has called for a national debate on the state funding of political parties.

The leader of the House told MPs he would welcome discussions on extending the existing public funds that are made available to parties represented in the Commons.

"I think there is a strong case... for extending public funding so we have our political parties outside parliament as well as inside parliament supported so we can better connect with the public," Hain said.

"I don't mean funding for campaigning or poster boards or leaflets, I mean state funding of the kind that is practiced widely throughout the world which makes sure that political parties can keep more closely in touch with local people and therefore better reflect their views."

While Hain has called for a debate on state funding previously, the prime minister has indicated he is sceptical about the move.

The Commons leader also said that the Conservative Party had received more than £4 million in public funds since 1997.

"In fact the Conservative Party is now propped up by public funds," he added, noting that the party had received more from taxpayers than private funds.

"I think the taxpayers should know about this."

Liberal Democrat Commons spokesman Paul Tyler also said there should be "an urgent debate" on the funding of political parties.

"All parties now are signed up to the principle of state funding," he claimed.

And Tyler said there were concerns that parties were "getting corrupted by the way in which influence is imposed upon them by millionaires' cheques".