Iain Dale: When you decided to return to the leadership, did you really think you could end up as First Minister?
Alex Salmond: Absolutely. I certainly thought it wasn't odds-on but I thought we had a fair chance.
ID: How do you think you have changed as a leader second time around?
AS: Older and wiser. Certainly not sadder! Things could not have worked out better, but this was not calculated. I resigned when we were ahead in the polls, but I felt ten years was long enough. With the press reaction to the SNP, I was becoming the issue - they weren't seeing past me. I thought someone else might get a fairer shout. Actually, I was wrong because John [Swinney] got treated far worse than I did. I didn't think "I'll resign, come back again, win the 2007 election". Nobody can calculate like that.
ID: When you walked into the First Minister's office for the first time, was there a slight sense of disbelief that you had done it?
AS: Actually, it's not until 12 days later than you're elected by the chamber. That moment of saying "my goodness, we've done it" doesn't come until you get the vote read out. That is the defining moment.
ID: Was it a proud moment in the Salmond family?
AS: My wife, my wee sister and my Dad were up in the gallery. My Dad had never seen me speak in a parliamentary chamber. He didn't really approve of me setting foot in the House of Commons. It was a hell of a moment.
ID: Were you daunted at all by the job?
AS: I don't do daunted. The one moment I would say I felt a bit daunted was the terrorist attack on Glasgow Airport. It was the day of the Royal opening of the Parliament on 1 July. I had gone back to Bute House with a few friends - with Sean Connery, actually - and was watching TV coverage when it came on. The daunting bit was, it wasn't just about watching. I was expected to do something. You realise it's not some other person that's behind the eight ball, it's you.
ID: Is there any kind of turf war in these circumstances between Edinburgh and London?
AS: None whatsoever. The transfer of the suspects south of the border was a law officers' decision, nothing to do with politics.
ID: Did you and Gordon Brown talk?
AS: Within seconds of it happening. He was literally just in office, his first few days. He arranged the COBRA meeting. I arranged our equivalent meeting in what we now call the Resilience Room. It was called the Emergency Room but it's very difficult to be calm in a room with a bloody big notice that says 'emergency'!
ID: How much contact do you have with Gordon Brown?
AS: Quite a lot. Most recently during the fuel dispute at Grangemouth, but initially we had quite a lot of contact. More than I had with his predecessor. If you remember, he didn't phone or write when we took power.
ID: You must have found that quite insulting.
AS: No, I found it great. Another miscalculation. I thought for the master of presentation it was an extremely foolish thing to do. Maybe it was because he was demob happy so he didn't care anymore.
ID: Your relationship with Brown is presumably businesslike rather than particularly friendly?
AS: You wouldn't expect us to be bosom buddies, walking arm in arm to the pub for a wee snifter, let's put it that way. We both have high stakes to play for. I believe in independence for Scotland, clearly the Prime Minister doesn't. No amount of rapprochement will bring us together on that issue. And that applies to a range of other issues too. The best we can do is let the people decide.
ID: Following the Glasgow East result, do you think Gordon Brown is toast?
AS: I think there are people in the Labour Party who are being less than supportive of him.
ID: I'll take that as a 'yes' then...
AS: I have seen many people carry on under the same circumstances and even recover, so I am very wary about being certain. The problem is not so much, "Is Gordon close to his party," it's whether he's close to the electorate. That's his underlying problem. I suspect that Gordon is very aware of that. There's a quote from the Marquess of Montrose, my Dad's favourite piece of poetry: "He either fears his fate too much or his desserts be small, but dare not put it to the touch to win or lose at all." I think that must be the total opposite of Gordon.
ID: How many seats are you aiming to win in the next Westminster election?
AS: A minimum of 20. I think that is a reasonable objective.
ID: That's a fairly high bar, as you have never got more than half way there.
AS: Not quite true. We got 11 in 1974. As an economist I am good with figures. I think 20 is a reasonable objective.
ID: From your agenda, what would be the best result?
AS: A hung Parliament. Absolutely. Let's call it a balanced Parliament.
ID: It seems to me that the Conservatives are cosying up to SNP in quite an overt manner and that you are showing a bit of ankle yourselves. Would I be correct?
AS: [affects to look affronted] Showing a bit of ankle?! We don't use such terms in Scotland!
ID: I'm sure you have your own phrase!
AS: It is certainly true that of the other parties in the Scottish Parliament, the Greens - who have been very constructive - and the Conservatives have been the ones who have got the most out of the political situation, in my opinion. The Labour Party have just been heads down, charging and usually missing, bypassing the matador and heading into the crowd somewhere. And the Liberals? I have no idea what they are doing. I don't think they do either.
ID: Let's move on to Wendy Alexander. She accused you of conducting a personal vendetta against her. Isn't there some truth in that?
AS: I notice she got a bit of sympathy from you on your blog.
ID: A little bit...
AS: The only thing I have been accused of - by journalists - is wanting to keep Wendy in office. Nobody has accused me of wanting to get rid of her. I've said next to nothing about her troubles. This idea that I was chasing and harrying her... I must be the most restrained politician of all time.
ID: In these situations it's not just the party concerned who gets the blowback, it's the whole of politics. Do you think that the dual system of registration is causing confusion? Isn't there a case for it to be simplified?
AS: I don't know. Wendy's statement made a great deal of the fact she had asked advice from the parliamentary clerks. She made less of the fact that it was already beyond the deadline for registration. There's no doubt about the time limit. To rest on lack of clarity would seem to be weak. Are politics in general demeaned by these things? Well, perhaps the answer is for people to abide by the rules they have set themselves.
ID: When was the last time you said sorry?
AS: Personally, I recently said to my wife that the holiday we've just booked, may well have to been unbooked. I didn't say sorry once. I said it a hundred times. When you're First Minister you probably don't find it wise to own up to mistake after mistake...
ID: But people quite like a politician who has the guts to say sorry, don't they?
AS: That's right. If you do change your mind on something it's best to admit it. I haven't had many disagreements... Macmillan kept losing the Conservative whip until he became leader. After that, things became considerably easier. People didn't try to expel him any more.
ID: It didn't quite work for Iain Duncan Smith.
AS: Well, it's been my experience in the SNP. I was always getting into trouble before I became leader. And then my troubles stopped! I got expelled from the SNP in 1982 as a rather brash young man. I've often reflected that there was a considerable amount of fault on my side.
ID: Are you more forgiving now than others were to you at the time?
AS: Yes, I've often reflected that wherever you can, you should avoid using procedures of the party as a means of suppressing political dissent.
ID: Do you see David Cameron, to quote the famous phrase, as "someone you can do business with"?
AS: The Tories have been more constructive than other opposition parties in the Scottish Parliament, but I don't think you would have to scratch very hard in London to see real anti-Scottish antagonism from many elements of the Conservative Party. I don't think the leopard has changed his spots.
ID: Cameron has made some very pro-Scottish comments.
AS: Maybe the wrapping has changed somewhat but I think the leopard is still there.
ID: But if there is a hung Parliament where the Conservatives are the largest party, is there any circumstance where you could see SNP MPs going into coalition with them?
AS: None at all.
ID: So you completely rule that out?
AS: We have a policy on that. We don't have a policy preventing a formal coalition with the Labour Party but I don't see circumstances where that could happen either, right now. In a hung Parliament we wouldn't be trying to enter a coalition, we'd be trying to exert influence. Believe me, the best way to exert influence in Westminster is not to be in a formal coalition.
ID: So it would be on an issue-by-issue basis?
AS: Yes. Even in a Parliament with a majority of 66, circumstances can arise where a small party can save the Prime Minister's bacon - witness the DUP and 42 days. In a Parliament with a much smaller majority or none at all it is going to happen more often, and that's what we would do.
ID: Ten years ago, the Conservatives were seen as a terrible enemy by the SNP, and they saw you as very left-wing. It seems to me that you have tried to change that, and create a big tent for the SNP.
AS: I suppose I have tried to bring the SNP into the mainstream of Scotland. We have a very competitive economic agenda. Many business people have warmed towards the SNP. We need a competitive edge, a competitive advantage - get on with it, get things done, speed up decision making, reduce bureaucracy. The SNP has a strong social conscience, which is very Scottish in itself. One of the reasons Scotland didn't take to Lady Thatcher was because of that. We didn't mind the economic side so much. But we didn't like the social side at all.
ID: Doesn't that illustrate the problem, that Scotland is seen as having quite a big public sector and, as the country of Adam Smith, it is no longer seen as the country of enterprise?
AS: I think that betrays Adam Smith. He was not just a friend of economics. He was a moral philosopher. Margaret Thatcher could have only ever read the Penguin edition of Wealth of Nations and she missed out the moral sentiments. I would absolutely defend the reputation of Adam Smith against the Adam Smith Institute. I said to Eamonn Butler [Deputy Director of the ASI], if Adam Smith could sue, you'd be in real trouble.
ID: What can you do as a government to ram home the message that Scotland wants the world's business?
AS: I don't think Scotland has an international projection problem welcoming business. Against a very difficult investor climate we have done spectacularly well in key sectors. That will be exemplified even more in our Year of Homecoming in 2009, and we expect you to take part in this, Iain. This is for first, second, third, fourth, fifth generation Scots.
ID: I am a quarter Scottish.
AS: There we are, we've got you. There are 100 million Scots around the planet.
ID: I am a descendant of one of Robbie Burns' bastard children...
AS: Iain, you are perfectly positioned to celebrate the 250th anniversary of your ancestor. That only happens once every 250 years!
ID: Indeed.
AS: Therefore I am instructing, nay commandeering, 100 million people to come back to Scotland at some point during 2009 to enjoy the festivities.
ID: Preferably not all at once.
AS: No, because we have stretched the events from Burns Night to St Andrews Day. We have five themes. Burns himself, great minds and innovations, whisky, golf, and our culture and heritage. All the transatlantic flights have already been booked.
ID: It's all becoming clear to me now. That's why you want the referendum in 2010 so you can sweep to victory on the back of a tide of nationalist euphoria!
AS: You've got it. You've seen through me again.
ID: That's why Wendy Alexander wanted the referendum now. Now I get it! Is it a frustration for you being First Minister than you only have powers over certain areas and not others?
AS: Yes, of course. Can you do nothing about the economy? No I don't agree with that, but you are boxed in to enterprise policy, business incentives and supply side initiatives. However, we have done something dramatic for small businesses with the elimination of business rates, for example. But for Commanding Heights intervention on adjustment of tax then you are heavily restricted and that is a real frustration.
ID: Do you think you will ever use your tax-raising powers?
AS: I don't see that in the foreseeable future.
ID: A subject dear to my heart is an English Parliament, which you presumably approve of...
AS: I am right behind you. I'm surprised at Ken Clarke's lily-livered report.
ID: Are you? It's a compromise, isn't it?
AS: I was being ironic. Certain compromises you can muddle through, but if I was producing a way to protect the essential integrity of the United Kingdom - which I'm not - I wouldn't produce that. It's a lot of nonsense.
ID: Do you agree that there is a resurgence of an acceptable form of English nationalism?
AS: I have huge sympathy with the political argument. As you know, by choice, SNP MPs have abstained from every vote on English legislation that does not have an immediate Scottish consequence. If you're asking me should people in England be able to run their own health service or education system, my answer is yes. They should be able to do it without the bossy interference of Scots Labour MPs. We had this in reverse through the 1980s. Because I believe in independence for Scotland, I also believe in independence for England. I know there are a lot of doom-mongers who say that England couldn't stand on its own two feet. I deprecate that sort of talk [laughs]. I have great confidence in England's ability to be self-governing.
ID: We are so grateful!
AS: Nothing makes me angrier than people who deprecate the abilities of their own country, their own people. It's insidious and damaging. Patriotism is said to be the last refuge of the scoundrel. The reverse is the last refuge of the scoundrel in politics.
ID: Does it irritate you to read negative things in the English newspapers about Andy Murray? How the English shouldn't support him because he said he didn't want England to win the World Cup?
AS: I don't think that the plain people of England think that. The sort of people who think that are the sort of people who go on your blog! [roars with laughter].
ID: Thank you! But let me put the reverse point to you. I want Scotland to win at any sport. It's partly my country too. But there are plenty of Scots who revel in an English defeat.
AS: I have form on this matter. You're not talking to the First Minister who supports other teams against England in the World Cup - that was my predecessor [Jack McConnell]. I think that individuals have every right to a bit of banter.
ID: But it goes beyond banter.
AS: When you become national leader you're under a different set of rules. Anything I say can be interpreted as the view of the country. People should back their own country. No one is obligated to support anyone else, but I don't think you should get your kicks by some proxy. It's pathetic. I have never indulged in it.
ID: In May 2011 you will be up for re-election. What do you want the Scottish people to think about your four years in government?
AS: I want our record in government to reinforce the popularity and trust in the SNP. By our deeds we shall be known. People do not expect miracles. They do not expect a minority government to have transformed the country in the space of 12 months but most people seem to be happy with what they have seen so far. The trust in government as expressed in the Social Attitude Survey has risen by 20 points - from 50% to 70%.
ID: It must be a relief to have got through the first year with a reputation for competence.
AS: It was a desirable objective. As you have probably noticed, I am not short of confidence, so relief is the wrong phrase, but I was determined that that should be done. So much so that I banned holidays last summer and said look, you're Cabinet Ministers, make your mark. And they did. We have a new style of government. We slashed business rates for small companies, froze council tax, abolished tolls, saved the hospitals, reduced prescription charges. We're now trying to get to some of the more underlying structural challenges - reshaping the relationship between central and local government. If we can do that, there will be a big gain. We've already abolished more than 60 ring fences. We are attacking on the binge drinking culture, which is an even bigger problem than it is in England. This is difficult because we are tilting against vested interested, the power of which you would not believe.
ID: So how do you think you've done overall?
AS: Well, I'm not going to do a Wendy Alexander and give myself ten out of ten [laughs].
QUICK FIRE
James McAvoy or Sean Connery?
Has to be Sean Connery, but I would never pit two fantastic Scots against each other.
Oatcakes or haggis?
Oatcakes win, but only marginally.
Favourite view?
Culloden Bay. If you haven't seen it, you must. A couple of Tory MPs have holiday homes there. It's fabulous.
Wendy or Douglas?
Wendy
Last time you cried?
[pauses] I shed a tear recently. There was an episode of Star Trek that was particularly poignant [collapses in laughter].
What music makes you dance?
My guilty secret is that I like country and western music. I am a devotee of Tammy Wynette.
Favourite food?
In early June you can get Duke of York potatoes, fresh sea trout and Scottish asparagus. Usually they are out of sync, but sometimes you can get them all in season together.
Favourite comedian?
Elaine C Smith, the wife of Rab C Nesbitt.