McQueen - who played at Old Trafford from 1978-85 - said that Guardiola's managerial talents and track record should make him United's top target to replace under-fire manager Louis van Gaal at the end of the season on their own merit.
However, McQueen says it is important United makes a serious play for Guardiola simply to stop him from arriving at cross-town rival Manchester City.
"Imagine if Guardiola goes to City and they sign Lionel Messi [who played for the Spaniard at Barcelona]. That would devastate United. They might as well turn the lights out at Old Trafford - that would be the ultimate nightmare," McQueen said. "That’s why United have to go all out to get Guardiola, whatever it costs. United have the money, so just pay it."
McQueen said Van Gaal had been given long enough to implement his philosophy and get results at United.
"The Van Gaal way just isn’t working for anyone and although I understand it’s in United’s thoughts to promote [assistant manager] Ryan Giggs and give him a go, if Guardiola is available they owe it to the fans to have a conversation with him," he said. "For me, Guardiola has proved himself the best in the business. If he wants £20m a year, give it him. The money shouldn’t be an issue."
McQueen thinks Ed Woodward has no choice but to pursue Guardiola.
"If Ed Woodward doesn’t try to persuade him to make United great again, then he isn’t doing his job properly," he said. "That’s the manager the majority of fans would want and I still believe United have the history, tradition and global presence to be attractive to Guardiola.
"If City got Guardiola, I’m certain it would seriously damage morale at United. City are already ahead of United in terms of their squad and Guardiola would only make them better."
McQueen said he could see Giggs as United manager at some point, but questioned whether he had the ruthless streak required to manage the club.
"Giggs might make a United manager one day. But in the situation they are in now, I have my doubts whether it’s the right moment for a rookie manager," he said. "Alex Ferguson was a brutal man when he had to be – and that’s why United were so successful. I worry if Giggs is ruthless enough to do the job, but at least he’d bring back the United way of playing everyone wants."