Labour faces big challenges to win the next Scottish election because of the “dire” economic situation and the country’s volatile electorate, the Scotland secretary has said. Ian Murray said the Labour government and the wider party had to accept they had “a big hill to climb” to regain power in Holyrood in elections scheduled for May 2026. He will tell delegates at the party’s annual conference in Liverpool that they cannot assume Scottish voters will deliver a landslide election victory as they did in the Westminster elections this year unless Keir Starmer’s government can prove Labour deserves it. “The message to delegates is that we’ve come a long way, we’ve done exceptionally well, but the electorate in Scotland hasn’t come home. They’ve lent us their vote … to kick out the Tories and deliver the change that was in our manifesto,” Murray said. “We need to show the electorate that we can deliver and that’s going to be tough between now and 2026. But the direction of travel from the government already has been hugely positive. That’s the message.” Murray said it was “drilled into everyone” in the prime minister’s cabinet that winning the Scottish and Welsh devolved elections in 2026 was the “gateway” to a second Labour government at Westminster. Yet the party had to remember Scotland’s electorate was the most volatile of any in the UK, he said, illustrated by Labour’s sharply fluctuating fortunes there. The party won 41 Scottish seats in the 2010 general election, but held only one of those in 2015 – Murray’s seat in Edinburgh South. Labour then won six seats in 2017, before going back down to one, Murray’s, in 2019. In July, Scottish Labour won 37 Westminster seats with a higher share of the vote than at the UK level. Yet since then Scottish parliament opinion polls show Labour narrowly trailing the Scottish National party (SNP) on about 30% of the vote. Labour isthe third largest party in Holyrood, with 22 out of its 129 seats. It needs about 50 seats to stand a chance of forming the next Scottish government but under Holyrood’s proportional voting system it has to be substantially ahead of the SNP to achieve that result. “That’s a challenge for the UK government to deliver, but it’s also a challenge for the Scottish party to get into shape, to show that a change in the guard in Scotland is beneficial,” Murray said. “I’m confident that we’ll get to 2026 having shown enough progress with the key priorities of the Scottish people to show that we’re a competent government.” Starmer had started cleaning up “the almighty mess” left by the Conservative government at UK level, while the SNP’s record had been “dismal” despite its 17 years in power, Murray argued. He defended the decision to cut winter fuel payments for pensioners on the grounds Labour had inherited “dire” public finances as well as a series of industrial crises, such as the closure of Grangemouth oil refinery, saying tough decisions had to be made. By the next Holyrood election, Murray said, GB Energy would be set up and based in Scotland; new workers’ rights laws would be in place; Scotland’s place in UK decision-making would be strengthened; his department would be spending tens of millions on Scottish levelling up projects, and the country’s shipyards may have won a big Norwegian frigate contract. Labour was also fulfilling its manifesto pledge to work much more collaboratively with the SNP in Edinburgh by replacing the tense, “confrontational” relations between the SNP and successive Tory prime ministers with “professional government”, he said. Starmer met John Swinney, the first minister, in Edinburgh within 48 hours of winning the election in July. Murray also underlined close ministerial ties, saying there had been repeated meetings between the UK energy ministers, Ed Miliband and Michael Shanks, and their Scottish counterpart, Gillian Martin, to devise a rescue plan for Grangemouth, while Wes Streeting, the UK health secretary, was “never off the phone” with Scotland’s health secretary, Neil Gray, and Peter Kyle, the science and technology secretary, was in frequent contact with Scottish universities. The collapse of the SNP’s efforts to force a second independence referendum had caused a “big shift” in Scottish politics, he said. “Resetting the relationship is now much easier. That constitutional argument has been set aside. It’s no longer a priority for either government or the public.” This article was amended on 20 September 2024. A previous version said Scottish Labour won 39 Westminster seats at the general election. They won 37.