Skype on ios7/iPhone4 completely useless
After spending a considerable amount of time, I managed to install a much older version of Skype using the Windows version of the guide mentioned here,

http://lifehacker.com/download-old-versions-of-ios-apps-with-a-clever-workaro-1749950092

I was lucky that my first attempt gave me a version that worked so I only had to do it once. 

For anyone else interested, in the list of softwareVersionExternalIdentifiers I selected 756732646 which corresponded to Skype version 5.7.120

HTH