LONDON, May 5: The Scottish National Party (SNP) seems to have taken its first significant step towards its goal of winning independence for Scotland from the UK as it emerged as the single largest party in the Scottish parliament following Thursday’s council elections.

The Independent on Saturday said a dramatic election in Scotland saw the party win a knife-edge victory over Labour by 47 seats to 46, inflicting Labour’s first significant defeat in north of the border for 50 years. The poll was overshadowed by a fiasco in which up to 100,000 ballot papers were disqualified amid confusion among voters and problems with a new electronic counting system.

Alex Salmond, the SNP leader, claimed he had the “moral authority” to govern and that Labour did not. “Scotland has changed for good and for ever,” he said, adding: “Labour will never again be able to assume a divine right to rule Scotland.” He promised an independent judicial inquiry into the voting scandal.

The historic victory by a party committed to pulling Scotland out of the United Kingdom was a crushing blow for Labour and could cast a dark cloud over Gordon Brown’s first months as prime minister. It could provoke huge tensions between the government and the Edinburgh parliament and demands from English voters to allow Scotland to break away.

Mr Salmond, who is determined to become Scotland’s first minister, will try to reach agreement on a “progressive coalition” with another party, but if he fails, he could seek to govern as a minority administration.

Labour could try to cling on to power by striking a deal with the Liberal Democrats to keep the SNP out. A weekend of frantic horse-trading is in prospect. Jack McConnell, who was Labour’s First Minister going into the elections, said the parties had a responsibility to keep “all options open and consider what is best for Scotland”, But a renewed Lib-Lab coalition would enrage the SNP.

In its traditional heartland in Wales, Labour’s vote declined to 32 per cent, its lowest level since 1918. It remains the largest party in the Welsh Assembly but will need the support of another party to run it. Labour is expected to hold coalition talks with the Liberal Democrats next week.