Arguing that the state is facing a $500 million shortfall, state Sen. Joe Kenney (R-Wakefield) proposed seven steps that should be taken to cut government spending.

Kenney is running for governor against current Gov. John Lynch (D-Hopkinton), whose campaign argues that Lynch has taken steps to cut spending.

"I believe along with many of the members of my party and key members of the Finance Committee such as Ken Weyler and former Ways and Means Chairman Norm Major that we now face a $500 million shortfall for 2010/2012 with no way being presented to fix it and a $200 million shortfall for 2009 and yet the governor remains silent," Kenney said at a press conference in Concord.

Kenney's plan includes issuing executive orders to cut agency spending by 10 percent, extending the purchasing freeze and reducing the number of cars and cell phones that are used by state employees.

But Lynch campaign spokesman Evan Carlson said the governor is already taking steps to curb spending.

"New Hampshire, like states across the nation, is facing a revenue shortfall because of the severe downturn in the national economy," Carlson said in a statement. "That is why Gov. Lynch has taken responsible action by freezing hiring, travel and state purchases. He cut department budgets for fiscal years '08 and '09, and as a result, we ended the last fiscal year with a small surplus. With the worsening economy, he has directed state agencies to come up with additional cuts for this year, and even lower budgets for the next two years."

Kenney, however, is accusing Lynch of being "asleep at the wheel" while the state's budget deficit increased.

"He is asleep at the wheel ignoring the bus that is about to hit New Hampshire taxpayers who cannot afford more fee and tax increases," Kenney said. "He has ignored the oncoming financial crisis and has no plan to deal with the shortfall created by his overspending."

Carlson added, "These are challenging times, and Governor Lynch is providing the steady, careful leadership our people expect and deserve."