Wendy Alexander yesterday admitted her troubles over an illegal donation to her leadership campaign had been a "fiasco" even as opponents criticised her over another funding row.

The Scottish Labour leader denied she was had personally benefited from being in politics, saying: "I am poorer now than I have been in 20 years. I earned more in the private sector than I ever earned in politics. You have to look the part as well, goddammit. I never had my hair highlighted in my life before. Whatever this is, it's not a gravy train."

However, opponents highlighted new concerns that two dinners organised to promote economic regeneration in the west of Scotland five years ago had helped to fund her constituency office.

Ms Alexander received £12,000 from the Scottish Industry Forum (SIF), which organised the two "Renfrewshire Renaissance" events in 2002.

Labour yesterday stressed the money was declared with both the parliamentary authorities and the Electoral Commission and insisted the party's links with the SIF were well-known. But some of those who attended the events, including Conservative and SNP supporters, said they were unaware the money raised was destined for Labour coffers.

Alex Neil, the SNP MSP, yesterday said the law on party funding may have been broken and called on the Electoral Commission to launch an investigation.

The SIF has not operated for five years, but a Labour spokesman said: "In December 2002 and March 2003, Wendy Alexander recorded sponsorship contributions to her office from the Scottish Industry Forum. Both were fully recorded at the time and in the Register of Members Interests and with the Electoral Commission. These entries have been in the public domain for five years."

In an interview, Ms Alexander said she tried to follow Buddhist teachings in stopping her from mounting personal attacks on her political opponents. She said: "(Politics) is not the sort of world where the Buddhist mantra of is it true, is it necessary and is it kind' is very often applied to a political speech.

"But I do sometimes give thought before I speak to whether those tests have been applied."

Meanwhile, Downing Street yesterday moved to deny a Sunday newspaper report that Prime Minister Gordon Brown was seeking to take control of the Scottish Constitutional Commission set up by Ms Alexander to examine the Scottish Parliament's powers.