SCOTTISH Labour leader Wendy Alexander today tried to put the party funding row behind her with a St Andrew's Day speech in Edinburgh on Scotland's future.
She committed Labour to taking part in a new cross-party commission to look at new powers for the Scottish Parliament.
She warned the party must not become "unthinking unionists".
And she said: "There is unfinished business from the 1999 Scot
land Act and it is Labour's job in partnership with other parties to fix it."
In the keynote speech, entitled A New Agenda For Scotland, Ms Alexander recalled the initiative of the late Donald Dewar almost 20 years ago in taking Labour into the cross-party Scottish Constitutional Convention, which drew up a blueprint for devolution. "It was controversial within Labour at the time, but history proved him right. He had read the democratic mood of the nation correctly."
And she said Labour had to be ready to take more risks if it wanted to lead the constitutional debate.
Yesterday, Ms Alexander was engulfed in a row over an illegal donation she accepted from Jersey-based businessman Paul Green for her leadership campaign earlier this year.
Glasgow Labour MSP Charlie Gordon resigned as the party's transport spokesman at Holyrood after he admitted unwittingly misleading Ms Alexander over the details of the £950 donation.
He said he had asked Mr Green for the money, but wrongly believed it was being given under the auspices of a company he controlled because it is illegal for people who are based off-shore to donate to a UK political party.
Labour MSP Tom McCabe, who was Ms Alexander's campaign manager, agreed the party had broken the law and said he was returning the money. The matter has been reported to the Electoral Commission by Labour.
But the SNP claimed Labour was in "meltdown".
SNP MSP Roseanna Cunningham said: "This latest development casts a huge question mark over Wendy Alexander's judgement and her leadership abilities. Not only did Ms Alexander's campaign accept an illegal donation, they then tried to cover it up."
Scottish Tory deputy leader Murdo Fraser said: "
The way in which Labour has handled this issue demonstrates either inability or reluctance to get to the core of the problem."
Scottish Labour's donation row comes as the parallel storm over donations continues to engulf Gordon Brown and the UK party. The Electoral Commission announced last night it was passing the case to the Metropolitan Police for "further investigation".
The inquiry was prompted after it emerged at the weekend that property developer David Abrahams gifted Labour £650,000 through a series of associates to get round the law requiring political donors to be declared.
The full article contains 452 words and appears in Edinburgh Evening News newspaper.
