After the Prime Minister failed to rally a fractious Labour Party at their annual conference in Brighton, the Scottish champions hardly delivered a confidence motion before their new leader, Alastair Johnston. It was not defeat to Sevilla but the manner in which it was inflicted that has highlighted Rangers’ inadequacies at Champions League level and, frankly, exposed the collective tedium that now threatens their more modest domestic ambitions.

Rangers performed prettily but without any hint of penetration until Sevilla began perforating Allan McGregor’s resistance. In the clamour to accuse the novice Swedish referee, Jonas Eriksson, of costing Rangers a penalty and a chance of victory, the most pertinent observation was glossed over.

Walter Smith, a manager in the midst of a battle of wills between the board and the bank, could not have been more damning on the limitations of his team. “Once we have to open up and play, that becomes a problem for us,” he said. It was a comment that provoked nary a splutter amid the debris of a 4-1 lashing but, in the final analysis, such brutal honesty has been lacking from the hierarchy throughout this period of financial and qualitative downsizing.

Rangers, and Celtic for that matter, are now so far removed from Europe’s elite they might as well take their curious little rivalry to Kazakhstan.

During Johnston’s inaugural speech, he spoke optimistically on the challenge of removing the club’s dependency on external financing -- ie the overdraft facility agreed with HBOS/Lloyds -- while ensuring the club’s readiness for football’s next big revolution.

Such talk is wildly presumptuous for a team who have won just two of their last 17 European ties inside 90 minutes, against Werder Bremen and Sporting Lisbon. It is a record of achievement that, superficially at any rate, is akin to cannon fodder, yet this sequence somehow took Rangers to a UEFA Cup final. There remains a strong whiff of denial regarding Rangers’ health, both in finance and on the football field. Smith, for one, has had enough of the propaganda.

It is understood that he has been offered a three-year extension that would keep him at Ibrox until retirement age by the board members who wish to be part of a new order at Ibrox. At the same time, the bank have steadfastly refused to entertain the idea of any significant contracts being awarded to strengthen the team .

It is this anomaly that leaves Smith less than enthusiastic at the prospect of staying on long term. The 61-year-old had not intended hanging around this long but the misery of last season’s exit to FBK Kaunas and a sense of duty towards his assistants prompted him to stay for another season.

Had Rangers not been in such a brittle state, he would have left having restored the championship to Ibrox. In good conscience, he refused to let Ally McCoist and Kenny McDowall to take the strain of losing 11 players in the summer while being thrust in the middle of a political struggle between the board and the banks.

It is, though, unwise to assume that Smith will accept a gentleman’s agreement to stay beyond January. He may be a man of honour and integrity, but he does not button up the back.

On Tuesday night, Smith stopped just short of saying his team no longer have the capability to compete, in the purest sense, with any opposition at Champions League level, never mind the established heavyweights.

It is a watershed moment for a club whose best hope of finding a buyer rests with Dave King sorting out his tax issues with the South African authorities. Rangers’ squad has stagnated through lack of competition.

The malaise was apparent even before kick-off against Sevilla. While the Spaniards snapped the ball around purposely during a rigorous, high-intensity warm-up, Rangers players converged around a temporary goal to take shots at the goalkeepers. It was the closest they got to scoring.

Unless a new buyer can be found within a year, the club must give serious consideration to a radical change of philosophy. Smith will not continue to work in ever-decreasing circles but that is precisely what will happen if the club cannot retain their title and return to the Champions League. The sale of Madjid Bougherra, who now stands head and shoulders above anyone else in the squad, seems inevitable next summer.

There are familiar groans about Smith’s lack of faith in youth, not least for playing a full-strength team against Queen of the South, yet he has historically railed against such populist action, not least with Barry Ferguson and, at Everton, Wayne Rooney.

If Rangers do not place a heavier emphasis on youth development, though, there will come a time when the viability of Murray Park must be seriously questioned. If the board cannot sanction investment for the manager, then they will need to look elsewhere for a manager who is prepared to promote youth at the expense of instant success. That in turn will require a lowering of expectation from the support and a dilution of Rangers’ kudos.

The air of resentment around Ibrox at the mixed signals from their club is now conducive to such sobering reality. There is a feeling within Ibrox that winning the league was the worst thing to happen, since many of the problems off the field have simply been patched-up.

The outcome of Sunday’s Old Firm derby will either remove some of the gloom in the short term or compound it if the club slip seven points behind their rivals less than two months into the season.

Johnston’s flying visit having passed without a victory being achieved, it will be left to Martin Bain to deal with the day-to-day running of the club.

The chief executive deserves his opportunity to emerge from the shadow of Sir David Murray. He knows he must act decisively and clinically to address Rangers’ deep-rooted problems or suffer the same fate as the puppet prime minister whose strings are about to be cut.