McLetchie finally quits over taxi row

• Scottish Tory leader resigns over allegations he misclaimed travel expenses

• McLetchie becomes first UK political victim of Freedom of Information Act

• Deputy Annabel Goldie takes over as interim leader

Key quote

"I recognise that the recent coverage surrounding my expense claims has been damaging and is a major distraction from our efforts to rebuild support for the party in the country. Accordingly, it is right that I stand down as leader." - David McLetchie

Story in full DAVID McLetchie resigned as leader of the Scottish Conservative Party yesterday after learning that party activists had deserted him in the row over his taxi expenses.

Mr McLetchie said he realised that the ongoing controversy over his travel claims - which had dragged on for 260 days - was hurting the party and felt he had no option but to step down from the leadership with immediate effect.

"I recognise that the recent coverage surrounding my expense claims has been damaging and is a major distraction from our efforts to rebuild support for the party in the country," he said. "Accordingly, it is right that I stand down as leader."

Annabel Goldie, his deputy, took over as interim leader yesterday afternoon and is likely to remain in post until at least the start of December when a formal leadership election can take place.

Mr McLetchie had been under increasing pressure over his taxi claims since February when the first allegations surfaced about his use of parliamentary taxis to travel to his private law firm.

The Scottish Tory leader has insisted all year that the taxis he took were for parliamentary or constituency business, not for personal or business reasons - which would be strictly against the rules.

But the crisis became acute last week when it emerged that there were some contentious taxi claims which Mr McLetchie simply could not explain, including some to the home of Tory activist Lady Sian Biddulph who said Mr McLetchie had been to see her on "party business".

Mr McLetchie had been prepared to fight on doggedly against the allegations, but changed his mind on Sunday after discovering that he had lost the support of a third of Scottish Conservative constituency chairmen in a newspaper poll.

The Scottish Tory leader decided at that point that he had to go and he issued a short statement yesterday after telling his parliamentary colleagues that he was standing down.

In doing so he unwittingly secured himself a position in British political history - as the first high-profile victim of the Freedom of Information Act. The details of his taxi claims were released under the legislation which only came into force at the start of the year.

Mr McLetchie's colleagues expressed their sadness at his departure in public, but it did not take long before the manoeuvring began behind the scenes to find a long-term replacement.

Ms Goldie, from Glasgow, is seen as a good and safe choice to lead the party into the 2007 elections, after which she may decide to hand over to someone else.

Meanwhile, Murdo Fraser, 40, the radical right-winger for Mid-Scotland and Fife, was being touted as the long-term choice and the Scottish equivalent of David Cameron by his supporters last night. It is understood, however, that the Scottish Tories will try to hold off from staging a contest until after the UK party leadership has been settled at the start of December.

There were calls from within the party last night for a proper leadership contest, rather than a coronation, which some senior figures claimed would allow the Scottish party to choose its own direction and approach ahead of the 2007 election.

Mr McLetchie, 53, had been the Scottish Conservative leader for past seven years, taking over in 1998 in the aftermath of the Tories' disastrous 1997 election when the party was wiped out north of the Border. His greatest political achievement was widely seen to be his forensic pursuit of Henry McLeish which led to the former First Minister's resignation in 2001 following a financial scandal with remarkable similarities to Mr McLetchie's downfall.

Indeed, there are some senior Tories who believe that the eight-month controversy which has dogged Mr McLetchie was, at least in part, fuelled by his political enemies who wanted revenge for his attacks on Mr McLeish.

Mr McLetchie has already been chosen as the Conservative candidate for Edinburgh Pentlands, which he won in 2003, but there was speculation last night that he may decide not to contest the 2007 election after all, and may retire from frontline politics at that election.

Mr Fraser said Mr McLetchie had made the right decision, but refused to reveal whether he wished to succeed him.

"At the moment we are just recovering from the news and we will leave that to another day," he said. "Given the publicity over the last few weeks, particularly over the weekend, there was a certain inevitability about the resignation and I think he made the right decision for himself and the party."

Bill Aitken, the Tories' chief whip at Holyrood, said Mr McLetchie had been a tremendous servant of the party over many years, but agreed he had made the correct decision.

"It is a courageous decision to resign and the [Holyrood] group is very grateful to him for all he has done," Mr Aitken said.

Asked whether he wished to go for the leadership, the Glasgow list MSP added: "I don't think anybody should count themselves in or count themselves out at this stage."

Mr McLetchie's opponents also said he had made the right decision in quitting. Jack McConnell said: "Elected politicians should take great care when they are spending taxpayers' money. I am sure that David McLetchie has made the right choice for his family and for the parliament."

Nicol Stephen, the Scottish Liberal Democrat leader and Deputy First Minister, added: "This is clearly a major blow to the Conservatives. However, if David McLetchie believes he can no longer defend his position, he has done the right thing."

An SNP spokesman said: "MSPs are accountable for the use of public money. Given the long list of unanswered questions about his expenses it appears Mr McLetchie's position has become untenable, and so resignation was the only appropriate course of action."

A long and twisting journey that eventually forced the Conservative leader to call a halt

IT WAS always an unlikely mix for a political scandal: the party leader, the aristocratic divorcee and the taxi claims, but these were the ingredients that brought down Scotland's longest-serving party leader.

Mr McLetchie's problems began at the start of the year, when he faced allegations of a conflict of interest.

The Tory leader had signed a parliamentary motion condemning plans to expand Edinburgh Airport. At the time, he was a partner at the Edinburgh law firm Tods Murray, and one of his firm's clients was the Royal Highland and Agricultural Society of Scotland, which had a keen interest in any expansion plans.

After nearly two weeks of controversy, Mr McLetchie resigned as a partner from Tods Murray on 18 February.

But worse was to follow.

Five days before his resignation, as the controversy raged, one journalist had quietly submitted a request under the new Freedom of Information Act, which had only been in force for a few weeks, for all of the Tory leader's parliamentary taxi claims.

On 21 April, parliament officials provided photocopies of all of his claims, but blacked out many of the destinations, claiming that Mr McLetchie's safety would be compromised if they provided that level of detail.

Despite the censorship, it appeared as if many of the claims had been for taxis to Queen Street, then the home of Tods Murray, and there was speculation that Mr McLetchie had taken numerous taxis to his law firm at the taxpayers' expense.

The Tory leader vigorously denied these allegations, insisting that all the journeys he had taken had been for parliamentary or constituency business and not for personal or party business.

But the issue refused to go away and the next step, taken on 12 June, was an appeal by one newspaper to Kevin Dunion, the information commissioner, asking him to force the parliament to release all of the details of Mr McLetchie's taxi claims.

On 7 October, Mr Dunion ruled that the parliament should publish all of the Tory leader's claims with nothing blacked out.

Mr McLetchie then tried to pre-empt the release, conceding that he had claimed about 900 for taxis to Queen Street over five years.

But again he insisted that all the work he had done there had been official parliamentary or constituency business.

Then it emerged that Mr McLetchie had already paid back more than 250 in travel claims for party events, for which he should not have claimed in the first place - 166 for a flight to Bournemouth to the Tory conference and 90 for a taxi to Selkirk for another party event.

There was one particular address on the claims which caught the eye of voracious hacks. This was the Blackhall home of Lady Sian Biddulph, an attractive blonde divorcee and Tory activist.

It appeared Mr McLetchie had made several trips to see Lady Biddulph, and when approached by journalists, she replied that he had come to see her on "party business".

As it is strictly forbidden for MSPs to use parliamentary taxis on party business, the net appeared to be closing around Mr McLetchie.

The embattled politician decided last week that he had to stop the endless round of speculation and allegation so he offered to go back through all his diaries and records and find out why he had taken the taxis and, if there were any problems, to pay the money back.

Last weekend, Mr McLetchie faced the Conservative national council for a private meeting. While the senior party figures gave their leader their full backing, the ground was in fact shifting under his feet. Privately, many senior Tories were getting worried that the affair was dragging the party down and a poll of constituency chairmen revealed the devastating news that a third wanted Mr McLetchie to go.

It would seem Mr McLetchie believed that he could face down the Press and his opponents in the parliament if he felt he still had the backing of most of his MSPs, but when he realised that he was losing the support of his grassroots activists, he decided that he had to go.