Darling warns new leader of danger in veering to the left

Alistair Darling has warned Ed Miliband that Labour must not throw away its claim to economic credibility by proposing higher taxes or by calling for the public deficit to be cut more slowly.

In an interview with The Independent, the former Chancellor, who backed David Miliband for the leadership, promised his "full support" to the younger brother but delivered a parting shot as he prepares to stand down from the shadow Cabinet.

Mr Darling urged Ed Miliband to show that he was not in the pockets of the unions and cautioned him against a policy of making the 50p top rate of income tax permanent. He also warned him against opposing every spending cut.

Mr Darling accepted that his own policy of halving the £155bn deficit over four years was no longer set in stone. Although David endorsed it during the leadership election, Ed did not. But Mr Darling insisted: "I have yet to be persuaded that another approach would be better."

He added: "Ed is the leader. He has to form his own judgement. If I were offering him advice, it would be: yes, whatever we do must get growth back into the economy, but we have also got to be realistic and credible."

Mr Darling said the 50p tax rate on earnings over £150,000 that he had introduced should be temporary, for this five-year parliament. Although Ed Miliband has said it should be permanent, Mr Darling said: "I did not do it as a matter of philosophy. I did it because we needed to raise revenue to get the deficit down and to make sure the burden fell on those with the broadest shoulders. It was always temporary."

Mr Darling said the party must not appear to be too influenced by the trade unions after they played a crucial role in Ed Miliband's victory. "It is not a problem, as long as he makes it clear that his judgement calls will be what is in the best interests of the country, not one particular section. The leader... must lead the whole party for the benefit of the whole country. Tony Blair and Gordon Brown got us on to the centre ground of British politics and that is where we have got to stay. "

Before the general election, Mr Darling proposed that two-thirds of his deficit reduction plan would come from spending cuts and one-third from higher taxes. That, too, is now up for grabs. The former Chancellor promised not to criticise the new leadership if its "fresh eyes" changed his policy, but warned: "Whatever you do, it has to strike a chord with the public."

He insisted that differences between him and his colleagues were tiny compared to those between Labour and the Coalition, saying that the slowdown in Ireland showed the dangers of hasty, tough austerity measures. He said the Opposition should not produce an alternative spending review to the one George Osborne will unveil on 20 October, and insisted it could not oppose every cut he proposes. "That is just not credible... We all know that had we been returned to office in May, we would have had to make some very difficult decisions."

As Chancellor, Mr Darling had battles with Mr Brown but resisted the temptation to criticise the former Prime Minister. "We had our moments but I was determined to do what I thought was right," he said. He believes Mr Brown's reluctance to abandon his "Labour investment versus Tory cuts" theme was "counterproductive" and "damaging".

After spending 22 of the last 23 years on the front bench, Mr Darling is ready for a break. But, at 56, he is not ruling out a return to the front line. "Nothing is forever," he said.

Mr Darling will be in conversation with Steve Richards, The Independent's chief political commentator, at the Labour conference fringe meeting at 5.45pm tonight at the Midland Hotel, Manchester