A new national bank tasked with raising investment for Britain's long-term infrastructure needs is to be proposed by the Liberal Democrats.

Vince Cable will warn that there is no prospect of the levels of funding necessary over the next decade in areas such as transport and energy.

The Lib Dem Treasury spokesman will set out plans for a national infrastructure bank to reduce the cost of capital, through Government guarantees, and tap into private savings.

At the Civilisation Congress, an infrastructure conference in London, Mr Cable will say there is an urgent need for increased investment to create UK jobs and support the recovery.

"There is a big hole in the prospects of the long-term recovery and growth of the UK economy," he will say.

"Our infrastructure is currently rated 34th in the world, which is poor by anyone's standards."

He will say the Government's commitment to long-term infrastructure investment has been "woeful", while the Tories have failed to come up with a "concrete and viable solution".

Bank borrowing is more expensive, private equity is being squeezed in the credit crunch and there is a shortage of Government money for such projects, Mr Cable will say.

His proposed infrastructure bank would exploit demand from both individual savers and institutional investors, such as pension funds and insurance companies, for long-term opportunities.

He will say there are various financing structures that could be used, but add: "The simple point is that large-scale infrastructure financing will not happen, except in exceptional cases, through private markets alone and Government cannot afford to fund public investment directly."