Sour note at end of first Scottish Parliament term

THE SCOTTISH Parliament completed its first full term yesterday amid fears that the devolved government north of the border has lost its way. Less than six months after the Queen officially opened the Parliament, the Labour-led administration looks divided and directionless.

The recent sacking of John Rafferty, the keen moderniser in the Scottish Executive sometimes dubbed as "deputy" to Donald Dewar, Scotland's First Minister, has focused concern, not least at No 10, about whether Mr Dewar has the vision for dynamic government.

Next week will bring fresh trouble, as the issue which splits the Labour- Liberal Democrat coalition - calls for the abolition of university tuition fees - threatens once more to dominate the headlines. It is understood that a government-commissioned report on the issue, due out on Tuesday, will not recommend abolition of the fees, a conclusion which will incense the Lib Dems, who are pledged to scrap the charge.

However, it is the demise of Mr Rafferty which, most crucially, splits Labour.

Until last week he was Mr Dewar's most trusted confidant, chief of staff and a friend of 20 years. Perhaps more important he was a convinced Blairite, who had only days before made a combative private speech telling Scotland's civil servants that they were "not good enough" and demanding a radical overhaul.

He asked: "how can we possibly end up in a situation where we have 500 civil servants in Scotland working in the dying industry of fishing and how many in e-commerce? None." His nemesis, as so often with New Labour, was ostensibly caused by spin-doctoring - he wrongly briefed journalists that Susan Deacon, the Scottish Health Minister, had received death threats after telling anti-abortionists to "back off" from picketing clinics.

However, it is generally agreed that such an error was a forgivable offence - not least because Mr Rafferty was under intense personal pressure from the tabloid press. Both his daughter, who has suffered from drug addiction, and his son have been targeted in largely erroneous reports.

Nevertheless, Mr Dewar fired his key aide, after changing his mind on several occasions about Mr Rafferty's fate. A breakdown in trust between the two men was cited, but critics accuse Mr Dewar of dithering and then ditching his mentor as the newspapers scented blood.

The sacking occurred amid claims that other Old Labour parts of the Scottish Executive stabbed Mr Rafferty in the back and accusations that supporters of Gordon Brown exacted their revenge for Mr Rafferty's role in removing the party's former Scottish General Secretary Alex Rowley.

Mr Dewar's decision, opposed by a number of ministers, is now seen as leaving a vacuum in government at a time when its programme of reform is considered unambitious and Mr Dewar's statesmanlike "safe pair of hands" is no longer regarded as enough now that devolution has been delivered.

Members of the Scottish Parliament are increasingly alarmed that its reputation is being seriously damaged by rows and scandals involving the Labour-led Scottish Executive.

"Every time there is a big problem here, people tend to think that the Scottish Parliament is failing," said one Labour MSP. "But usually it is because the executive has got into trouble again."