Scots did not mind the economic policies of Thatcherism, First Minister Alex Salmond has said, provoking a Labour demand for an apology.

Scots did not mind the economic policies of Thatcherism, First Minister Alex Salmond has said, provoking a Labour demand for an apology.

The SNP leader was explaining in an interview that the opposition to Margaret Thatcher's Conservative government during the 1980s was against her "social side".

He contrasted this with her economic policy, despite this being notable in Scotland for a painful shutdown of traditional heavy industries and high unemployment.

In the interview with Iain Dale, a journalist who is also a leading Conservative in England, Mr Salmond argued that he has steered his party from the left to a more business-friendly position.

"I have tried to bring the SNP into the mainstream of Scotland," said Mr Salmond. "We have a very competitive economic agenda. Many business people have warmed towards the SNP. We need a competitive edge, a competitive advantage - get on with it, get things done, speed up decision making, reduce bureaucracy."

He continued by telling Mr Dale, editor of Total Politics magazine: "The SNP has a strong social conscience, which is very Scottish in itself. One of the reasons Scotland didn't take to Lady Thatcher was because of that. We didn't mind the economic side so much. We didn't like the social side at all."

Labour's response was to highlight the 1980s closure of shipyards and coalmines, UK unemployment at three million, followed by the poll tax, suggesting Mr Salmond is "losing touch" with his "deeply offensive comments".

Iain Gray, one of the three contenders to lead Labour at Holyrood, said the comments were astonishing and that Mr Salmond should apologise. "Any Scot old enough remembers that Thatcher's economics had at their core the belief that mass unemployment was not just a price worth paying but necessary in a modern economy," said the enterprise spokesman.

"Far from not minding' these economics, Scotland's communities were devastated by them. I remember being a teacher in the early 1980s and seeing the hope of a generation crushed by Thatcher and her economics."

A source close to the First Minister sought to limit the political damage, putting the pressure back on to Labour by recalling Gordon Brown's Downing Street invitation to Lady Thatcher. "The social consequences of Thatcherism were disastrous, which is why they were resisted so strongly in Scotland," she said. "That's why the First Minister would never invite Margaret Thatcher to Bute House."

Also in the interview, Mr Salmond recalled his expulsion from the SNP in 1982 as part of the left-wing 79 Group, saying he was "a rather brash young man - I've often reflected that there was a considerable amount of fault on my side".