The New Nation - Internet Edition

AFP, London

Prime Minister Gordon Brown's Labour Party snatched victory from the jaws of defeat Friday in a key by-election seen as a test of whether his handling of the credit crunch can equal electoral revival.

Labour's Lindsay Roy won 19,946 votes in the Glenrothes seat, just north of Edinburgh, compared to 13,209 for the Scottish National Party's Peter Grant, his nearest rival. That represents a majority of 6,737.

Before the world economic chaos struck, Labour officials had all but written off their hopes of retaining the seat in the by-election, triggered by the death of sitting lawmaker John MacDougall. But Brown has enjoyed an opinion poll bounce following the crisis and this appears to have propelled his struggling party to victory. Glenrothes is the neighbouring constituency to Brown's own in Kirkcaldy and Cowdenbeath, and the premier broke with tradition by campaigning in person alongside wife Sarah. Labour has been behind in opinion polls since Brown pulled back from announcing a widely expected general election in October last year. The next general election must be held before mid-2010.

In recent weeks it has made up ground-last week, a ComRes/Independent poll gave the main opposition Conservatives 39 percent support and Labour 31. This compared to a 19 point deficit for Labour two months ago.

The result represents a blow to the SNP and its hopes of securing victory in a referendum on Scottish independence from London which it wants to hold in 2010.

The SNP, under First Minister Alex Salmond, has led the devolved government in Edinburgh since last year, enjoying a honeymoon period thanks to popular policies such as scrapping council tax.

But some opposition politicians have accused it of arrogance and assuming it would win Glenrothes.

Its deputy leader Nicola Sturgeon told the BBC she was "deeply disappointed" by the result and denied it was linked to a Brown bounce.

"It was a campaign fought on very local issues, it was relentlessly negative," she said.

Salmond-whose party adopted the slogan of US president-elect Barack Obama, "yes we can", on the campaign trail-accused Labour of "negative scaremongering" earlier this week.