THIS January Jim Murphy, Labour’s leader in Scotland, made John McTernan into his chief of staff.

I saw McTernan last September at the Tory conference, offering advice to the Conservatives and praise to Margaret Thatcher.

McTernan was speaking at a breakfast meeting at the conference for Policy Exchange, a Tory-leaning think tank. The whole event was paid for by the Stock Exchange.

McTernan poured praise on Thatcher. He said: “She changed the economic structure for good. As in forever. But also for good. It’s a good thing she did what she did.”

His only complaint was Thatcher didn’t convince enough people and that “she didn’t sell what she was doing” enough.
McTernan told the Tories that he was an enthusiast for privatisation.

He told delegates: “There’s a far wider range of assets that are currently owned by the government which I would privatise. I would have privatised London Underground if I could have done.”

McTernan was really worried that people didn’t trust business enough.

He said: “We are in a really difficult situation” because a poll showed that “half the population think that the greatest threat to Britain and the future of Britain is big business” while only 19 per cent thought trade unions were a problem

Instead of being happy with the popular sentiments, McTernan thought this was bad, because he himself was “very relaxed about capitalism,” so he was bothered that anyone else was uptight about corporations.

McTernan thought it especially worrying that 45 per cent of Scots voted Yes to independence even when “the banks said they would leave Scotland if it became independent.”

McTernan also offered his “advice to the Tory Party.”

He suggested the Conservatives should not “let the Labour Party own equality and inequality.”

He said the Tories should say “they (Labour) can’t manage the economy, they’ve shown that. Why would you trust them to manage inequality?”

So just months before he became Murphy’s assistant, McTernan went to the Tory conference, told them that Thatcher and privatisation were great and offered them advice about how to attack Labour.

Xavier Rolet, head of the Stock Market, said that he was “very encouraged” by McTernan’s views. I can’t think that Scottish Labour voters will feel the same way.

McTernan was one of Tony Blair’s special advisers in 2004. His appointment is another sign the Blairite force is still strong in Scots Labour. His speech at the Tory conference shows how much new Labour was a compromise with Thatcherism.

LABOUR’S shadow foreign secretary Douglas Alexander will be fighting the general election in his own constituency with £5,000 help from a banker who employs the former head of MI6.

The register of MPs’ interests shows that Alexander’s constituency party accepted the donation from David Claydon.

They can use the money to try get Alexander re-elected in his Paisley and South Renfrewshire constituency.

This was a formerly rock-solid Labour seat, but according to the latest polls so many Labour voters are switching to the SNP that even Alexander’s 59 per cent majority is in danger.

So Alexander’s local Labour Party needs all the help it can get.

The money might be handy, but the associations with banking and the war on terror are less useful.
Claydon was a UBS and Morgan Stanley banker, but now runs an intelligence firm called Macro Advisory Partners.

Last month Macro Advisory hired John Sawers, former head of MI6, as its chairman.

Macro says its “network of senior professionals with backgrounds in diplomacy, intelligence, finance, academia and industry” will “provide clients with geopolitical risk, investment strategy and macro intelligence counsel.”

Sawers’s new spies-for-hire firm is very new Labour. Its founder partner, Claydon, donated £50,000 to David Miliband’s failed campaign to become Labour leader in 2010.

Claydon was also Miliband’s economic adviser between 2008 and 2010. It was Miliband in turn who, as foreign secretary, had Sawers appointed as head of MI6 in 2008, presumably because he was so impressed by his work for Miliband’s hero, Blair.

Sawers was a key foreign policy adviser for Blair in the 2000s. He helped set up Iraq’s post-war government.

This government designed by Sawers and co has been riven by incompetence, sectarianism and failure and can barely hold Iraq together.

Sawers told the Chilcot inquiry that they hadn’t calculated for Iraq’s post-war chaos and “frankly, had we known the scale of the violence, it might well have led to second thoughts about the entire project.”

Less frankly, Sawers claimed that nobody predicted it. Which is odd, as one of the many arguments the anti-war movement was making very publicly in the run-up to the Iraq invasion was that it would lead to chaos, violence and sectarian conflict in Iraq.

We were right and he was wrong, so Sawers prefers to pretend the anti-war protest movement didn’t exist.

What the £5,000 from Claydon shows is that there is still a very “new Labour” part of Labour, one that sees itself as part of the world where bankers, spies for hire and David Miliband’s pals all connect.

You can follow Solomon Hughes @SolHughesWriter