Nick Clegg has demanded "a new type of government" in exchange for Liberal Democrat involvement in any power-sharing deal after the next election.

Addressing the question of a hung Parliament in his first speech as leader of the party, Clegg said he would never join a Conservative or Labour government.

Lib Dem sources indicated the Clegg would not accept seats in the cabinet and would as a minimum seek "a review of all our constitutional and political arrangements".

Clegg also made light of last week's Commons revolt by a quarter of his MPs over the party's policy on a referendum on the EU treaty, joking that in the past the Lib Dems would have had to "borrow" MPs to achieve a result of that size.

He called for a £25,000 cap on donations to parties, a lower limit than has been suggested by the other parties.

He also repeated his plan for a new mechanism to allow MPs suspended from the Commons to face a by-election.

"Will I ever join a Conservative government? No," he said.

"Will I ever join a Labour government? No.

"I will never allow the Liberal Democrats to be a mere annex to another party's agenda.

"But am I interested in building a new type of government? Yes."

He added: "If we want a political system that works for the future, we need to start again; from scratch.

"I am not just talking about electoral reform. A change in our voting system is a vital part of what we need, but it isn't enough."

Lower taxes

The Lib Dem leader also signalled a major shift towards a tax-cutting agenda, with a promise to "never stop thinking" about how to lower taxes.

"Taxes should be fair, and they should be green. The should raise the money we need and not a penny more," he said.

"So if, before the general election, we find we can deliver our objectives with money to spare, we shouldn't look for new ways to spend it.

"We should look for new ways to hand it back, especially to those who need it most."