THE Labour leader, Mr Tony Blair, was forced on the defensive for the first time during this election campaign after he suggested his party's long-promised parliament for Scotland would have no more powers than an English parish council because sovereignty would remain "with me" at Westminster.
Although Scottish Labour Party officials attempted a damage-limitation exercise, describing the row as "hoo-ha", the remarks were immediately denounced by the Tories and the Scottish National Party, accusing Mr Blair of betraying the Scottish electorate.
Unfortunately for the Liberal Democrats, the row overshadowed the launch of their manifesto, which their leader Mr Paddy Ashdown, described as a "costed menu with prices", because they will increase taxes by a penny to make "Britain's education the best in the world".
Launching Labour's Scottish manifesto in Glasgow, Mr Blair was forced repeatedly to defend his comments and insist there were no discrepancies between the party's pledge not to raise taxes and his commitment to a Scottish parliament with tax-raising powers.
"I don't see what the problem is. We will not raise the basic or top rate of income tax. That is our commitment here in Scotland as much as it is our commitment in England and that will remain ... The Scottish Labour Party is not planning to raise income tax and once the power is given it is like any parish council, it's got the right to exercise it," he explained.
Although privately several Labour Scottish MPs were said to be unhappy with Mr Blair's remarks, the Shadow Scottish Secretary, Mr George Robertson, stressed they did not contradict the party's agreed policy and that it was up to the Scottish people to decide if their elected assembly would have tax-raising powers.
"We have repeatedly made it clear that we have no plans to use these powers. It is up to others to make their position clear on tax. The Scottish people will decide. That is what democracy is all about," he added.
While Mr Blair's aides claimed they had expected the controversy and insisted his comments merely pointed out that Labour would not raise taxes in Scotland, the Prime Minister, Mr John Major, said their devolution plans were now in "total and utter chaos".
"I found what he said patronising and extraordinarily inaccurate. His remark that sovereignty would continue to rest at Westminster contradicts the pledge made by every Labour MP when they signed the claim of rights in 1989. Here again is a gaffe by Mr Blair who doesn't realise what his own party policy has been."
The SNP leader, Mr Alex Salmond, suggested Mr Blair had "shown his contempt and derision for Scotland and Scottish people" and said his comments proved the devolution policy was a "deceit which would return Edinburgh less power than an English parish council" with all the major decisions still being made at Westminster.
Earlier, both Labour and the Tories attacked the Liberal Democrats manifesto for being a "lie", claiming their key-pledge that higher education spending would cost taxpayers only 45p a week was inaccurate, suggesting instead it would be £2.
The Shadow Treasury Chief Secretary, Mr Alistair Darling, compared the Liberal Democrat manifesto to the Tories, "sprinkled with uncosted commitments" and sums which do not add up.
Although Mr Major echoed this argument, he also attacked Labour's budget plans, claiming that a £1.5 billion "black hole" in the party's calculations would result in tax increases in the summer.
"Labour will have an emergency budget within 10 weeks of the election, a budget whose sole purpose would be to put taxes up. So at one stroke this weekend's tax cut could be wiped out in July. Even before they've created a tax-raising parliament in Scotland, they'd give you a tax-raising parliament in England," he said.
However, the Shadow Chancellor, Mr Gordon Brown, immediately launched his counter-attack, accusing the Tories of failing to explain how they will finance their £1.2 billion tax break for married couples and claiming their manifesto has £15 billion worth of commitments which have not been funded.
"The Tories are in disarray on public finances. The question the Conservatives cannot answer is where the money is coming from to pay for their £15 billion tax and spending commitments," he said.