Labour in Scotland was on the brink of civil war last night after a senior MP launched an outspoken attack on Wendy Alexander's calls for Holyrood to be given more powers.

The MP, who spoke on condition of anonymity, said there was "hostility" at Westminster to Ms Alexander's Scottish Constitutional Commission - and predicted that its recommendations would be rejected by the House of Commons.

In a further blow to Ms Alexander, a leading Labour councillor yesterday denied her claims that voluntary groups face massive funding cuts.

The deep divisions within the party were exposed as Labour MPs, MSPs and councillors prepare to meet for talks in Glasgow tomorrow.

Ms Alexander has been attempting to get back on the front foot in recent days following the Electoral Commission's decision last week not to call in the police over an illegal donation to her leadership campaign.

But she faced a setback earlier this week when, in an exclusive interview with The Herald, Scotland Office Minister David Cairns ruled out the possibility of the Scottish Parliament being given greater fiscal autonomy. Mr Cairns said extending the devolution settlement was only of interest to "the McChattering classes".

An aide to Ms Alexander hit back yesterday by accusing Mr Cairns of being "out of step" with Labour Party opinion in Scotland and the public at large.

That prompted a retaliatory attack yesterday from a leading Scottish Labour MP: "Out on the streets, there's no enthusiasm for the Scottish Parliament - there's even more contempt for MSPs than there is for MPs. There's no appetite outside what David Cairns described as the McChattering classes' for this circular, pointless argument. This is an agenda that is run by a very, very small minority of people within the Labour Party who I don't think are representative of the Labour Party in Scotland."

Asked about the level of support there is at Westminster for the constitutional commission, the MP said: "Overwhelmingly there is hostility towards it and hostility that Wendy proposed this without reference to MPs.

Frankly, the view is that whatever the commission comes up with, it has to get a majority in the House of Commons and it won't get that."

Meanwhile, Pat Watters, the president of the local authority umbrella group Cosla and a Labour councillor in South Lanarkshire, said yesterday that voluntary bodies need not lose out just because councils now have greater freedom on how to spend their budgets.

During a visit to a city farm in Edinburgh earlier this week, Wendy Alexander warned that many organisations faced massive funding cuts, but Mr Watters said: "To say that I as a local councillor cannot deal with voluntary organisations in my area because I have more control over the available finances available to us is absolutely wrong."

A friend of Ms Alexander last night sought to play down the differences within the party. "Everyone in the Labour Party agrees Labour's priority has to be about listening to voters and standing up for communities let down by Alex Salmond," he said.