Libyan leader Moamer Gathafi's son Saif al-Islam Gathafi late Monday outlined a planned new constitution for Libya, while stressing his father was among the "red lines" that could not be changed.

"Our next challenge is to set up a series of laws, which we can call constitution or social contract or something else. The important thing is to have a contract that will organize the lives of Libyans," Gathafi said in a speech in Benghazi, 1,000 kilometres (600 miles) east of Tripoli.

"First, there are red lines that we must reach agreement on," he said, quoting in order: "Islam and application of sharia law, (...) security and stability in Libya, unity of the national territory, and Moamer Gathafi."

The laws should guarantee the independence of the Libyan central bank, the high court, the media and civil society, Gathafi told a crowd of more than 40,000 assembled in a big square in Libya's second city.

He called for a "national dialogue embracing all the Libyan people to reach the ideal formula as soon as possible" to draw up a constitution, while expressing backing for the "direct democracy" preached by his father.

Libya will on September 1 celebrate the 37th anniversary of the overthrow of the Senussi monarchy by a group of "free officers" headed by Colonel Gathafi. He abolished the 1951 constitution which made Libya a constitutional monarchy.

A short temporary constitution was replaced in 1977 by a four-article "Declaration on setting up the power of the people."

Moamer Gathafi, who is in theory only a "guide" giving his advice, preaches "people's power" through "direct democracy" carried out by "people's committees."

His son stressed the need to widen the political dialogue beyond those committees. Political debate has been banned in Libya outside that framework.

He also called for strengthening the power of the prime minister so that he could choose his ministers -- something the people's committees have done up to now.

On the economic front, Gathafi junior welcomed the results of his reforms launched last year, saying that several development projects had been started in Libya at a cost of 60 billion euros.

In his televised speech he showed more moderation than in another speech a year ago in which he broke a taboo by denying that a "people's power" existed in Libya as laid down in his father's "Green Book" of political thought.

In that speech he lashed out at the "mafia" of bureaucrats opposed to political or economic reforms.