A LEADING economist who hopes to stand for Labour in Alistair Darling's Edinburgh seat has said the party must offer voters a plan to tackle inequality caused by growing globalisation.

Angus Armstrong, an economist with the respected National Institute for Economic and Social Research think tank, said the level of inequality in Scotland was not just morally unacceptable but the waste of talent was bad for the economy.

In a blog on the Labour Hame (corr) website, he argued growing inequality was a "side-effect" of the globalisation of trade.

He wrote: "Scottish Labour can be the party with a positive agenda to address the real challenges in our society.

"Policies aimed at redistribution can be justified as a counterweight to the widening income distribution as a result of globalisation, not simply a judgement about who is able to pay.

"Helping those at the bottom of the income distribution is not just a moral issue; if this enhances economic opportunity, it also improves economic efficiency.

"It is good use of money."

He said an economic plan based on tackling inequality was crucial for Labour's hopes in the election.

He added: "The stakes could not be higher.

"If recent polls are to be believed, Labour might no longer be the largest party in either the UK or Scottish parliaments.

"This would no doubt be used to justify a re-run of the referendum.

"More years of constitutional uncertainty would lead to a gradual erosion of Scotland's economy.

Dr Armstrong, who played a leading role analysing the possible economic consequences of independence in the run-up to the referendum, is seeking Labour's nomination to stand in Edinburgh South West, where Mr Darling is stepping down.

He has been invited by the party to join a panel advising the Scottish Labour leadership team of Jim Murphy and Kezia Dugdale.

A former Treasury civil servant, he was at the heart of Mr Darling's efforts to stabilise the banks during the 2008 financial crisis.

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