The leader of the Scottish Labour Party today survived a key meeting with party members as she broke her four day silence over her role in the illegal funding scandal that has blown up around her leadership campaign.

Speaking to party members in Edinburgh for the first time about the controversy, Wendy Alexander told the Scottish Parliamentary Labour Party that she did not intend to flout the rules when accepting a donation from Paul Green, the Channel Islands businessman, and had no intention of resigning.

Earlier today, Mr Green accused her team of "gross mismanagement" over the acceptance of his donation, which broke UK funding rules because it was sent from Jersey.

He claimed he had been assured that the £950 donation was above board by Charlie Gordon, an MSP who was part of Ms Alexander's campaign team, and added that he now wished he had not given the money at all.

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Giving her first statement on the affair, Ms Alexander insisted that she had repeatedly tried to ensure that the funding given to her leadership campaign had been above board.

"For the record, there is repeated correspondence initiated by me personally, dealing with the issue of permissibility, and demonstrating my interest in ensuring that donations received were indeed permissible," she claimed.

Indicating that she would not be standing down, Ms Alexander added: "I have always believed politicians should have the highest standards of integrity.

"It would be easy to quit but also wrong. To give up this job in these circumstances would be also giving up my reputation for integrity and honesty and I’m not prepared to do that."

She declared: "I have never sought to mislead. I am not dishonest in any way. My campaign did not set out to mislead anybody or break the rules."

Supporters of Ms Alexander were this afternoon said to be quietly relieved that the subsequent meeting, which lasted an hour and a half, passed without any indication of a major rebellion, with no speeches from backbenchers criticising her or calling for her to quit.

"I am delighted to say that she has got clear and overwhelming support within the group. There was no dissent at all," Duncan McNeil, chairman of the Labour MSPs, said.

However, speculation intensified around Holyrood today about whether Mr Gordon, who has already quit as Shadow Transport Minister, now plans to quit as an MSP over the saga. He was named personally by Mr Green today as the figure who assured him that his donation was above board.

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