TUC general secretary Brendan Barber last night set out an alternative economic recovery plan to the government’s spending cuts.

During a lecture entitled In Place of Austerity, delivered at the University of Liverpool, Mr Barber unveiled a five-point plan for action.

The lecture was the second in the University of Liverpool Management School’s Burning Issues series. Mr Barber attacked the government’s current economic strategy, saying it is causing rising unemployment, falling growth and increased borrowing.

Addressing an audience of 200 local business leaders, academics and students, Mr Barber called on the government to change course urgently, and adopt a plan B to get consumers spending again, businesses growing and bring the deficit down.

He said: “We cannot continue as we are. The current model of capitalism – deregulated, unequal, unstable – is facing a crisis of legitimacy.

“The economic predicament we face is dire and people are rightly getting angry. These really are profoundly volatile and turbulent times.

“The decisions the government is taking now will shape our lives for a generation to come. But it’s clear that austerity is failing us all. I hope ministers find the courage to admit they’ve got it wrong and change course before it’s too late. Because in place of austerity, we urgently need something better, fairer and more effective in delivering a real recovery.”

The TUC’s five-point plan calls for the public finance deficit to be reduced over a 10-year period instead of the current “kamikaze” four years.