LABOUR was accused of hypocrisy last night as a row escalated over SNP donor Sir Brian Souter's knighthood nomination.

It emerged yesterday that the Scottish Government had nominated the Stagecoach tycoon – the SNP's biggest donor – for the Queen's birthday honours in June.

Labour MP Cathy Jamieson had sought details of the award after it provoked criticism from gay rights groups over Sir Brian's campaign against the repeal of Section 28, a law banning the promotion of homosexuality in schools.

Ms Jamieson said: "The First Minister and his party must look seriously at the relationship they have developed with wealthy individuals handing them large sums of cash. The public will rightly be asking what's next on Mr Souter's shopping list?"

But a spokesman for First Minister Alex Salmond said the knighthood – given for services to transport and the voluntary sector – had been handled entirely by non-political officials, without any input from Scottish Government ministers.

The spokesman pointed to the letter written to Ms Jamieson by the UK Government's permanent secretary, Peter Housden, in which he wrote that "Scottish Ministers have no involvement in the Honours process".

The spokesman added: "Labour's hypocritical attack has totally backfired. The permanent secretary's reply of August 4 to Cathy Jamieson's letter makes the position crystal clear.

"The reference to the Scottish Government is not to ministers but to the independent Honours Group within the Scottish Government which consists of civil servants and is led by the permanent secretary, and makes recommendations to the UK Cabinet Office Honours Committee system."

SNP MP Angus MacNeil said last night that Labour's attacks had "boomeranged" and then called on the party to reveal whom it had nominated in the past.

He said: "Labour's attack is completely ludicrous and reflects on how they think and operate. As SNP ministers have made no nominations since 2007, Labour's questions fall at the first hurdle."

Mr MacNeil said that in the past Labour ministers had been involved in the process and called upon them to publish the names of those they put forward for nomination.

The founder of Stagecoach, Sir Brian has handed out more than £20 million to charitable causes through his own trust and, over the past four years, has donated more than £1m to the SNP – including £500,000 to this year's election campaign.

Green MSP Patrick Harvie said: "It seems implausible that civil servants working for SNP ministers recommended Brian Souter for a knighthood without taking account of the fact he was already the largest single donor to their political masters.

"What other factor could they have been thinking of? His privately funded campaign to protect the values of homophobic bigotry, or his lobbying against proper bus regulation which would force his industry to serve the public interest?"

Scottish Labour leader Iain Gray said: "We are today asked to believe that the SNP government made a nomination and just weeks later Brian Souter made one of the biggest donations the SNP has ever received – and it is all just coincidence.

"The idea that Alex Salmond was blissfully unaware that his biggest paymaster was nominated for a knighthood by the government he runs is laughable.

"Coming on top of revelations about how the First Minister fawned embarrassingly over Rupert Murdoch, this raises further questions about how Alex Salmond does business and his judgment.

"His weakness for courting billionaires – Souter, Trump, Murdoch – means that when they say 'jump', he asks 'how high?'."

Sir Brian declined to comment yesterday.