Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Alistair Darling, the former chancellor, is to stand down as an MP at the next election, in a further blow to a Scottish Labour party which has collapsed in the opinion polls and now faces a leadership vacuum.
But Mr Darling insisted the time was right for him to step aside while he was “still relatively young” and threw his support behind Jim Murphy as the person best placed to restore the party’s fortunes north of the border.
“Jim has the enthusiasm, the energy and above all he’s a fighter. For too long we have sat back when we needed to fight,” he said.
Mr Darling, 60, told the Financial Times he was “frustrated” that the Labour party had not used September’s independence referendum – which the No campaign won by a “decisive” margin of 55:45 per cent – as a springboard.
Johann Lamont resigned last month as Scotland’s Labour leader, with some opinion polls giving the Scottish National party more than 50 per cent of the vote and predicting near annihilation for Labour at next May’s election.
“My frustration is that we actually won,” he said. “You can’t say it often enough. We made the arguments, we had confidence in ourselves.” He hopes that Mr Murphy, the combative former Scottish secretary, can pick up the pieces.
He fears that unless Labour can halt the SNP advance, Scotland would soon be confronted with another independence referendum. “Most people in Scotland don’t want to be living in Neverendum Land,” he said.
Mr Darling said David Cameron had been “unwise” to inflame sentiment by linking further devolution to Scotland to the issue of “English votes for English laws” – including possibly barring Scottish MPs from voting on income tax at Westminster.
He said such a move would create “inherent instability” and could be disastrous in a future financial crisis, if the markets felt that a UK government did not have full control over the ability to raise income tax at Westminster.
“If you can’t raise money it has huge repercussions not just on what you can spend on your creditworthiness,” he said.
Mr Darling, who chaired the Better Together campaign, said he hoped to use his experience by helping a campaign to keep Britain in Europe in a future referendum, saying that such a vote now seemed inevitable at some point whoever wins the next election.
“It’s a boil that has to be lanced,” he said, but warned that the Scottish referendum had shown the danger of ceding too much ground to your opponents. “If you sit back and wait till the other lot have taken so much ground then you’re on the back foot,” he said. “You pay a heavy price.”
Meanwhile he urged Labour to tackle a sense of despair among voters by promising major investment in housing and transport infrastructure – funded by more borrowing at low rates of interest – to put the economic recovery on a stable footing.