TITLE

Osborne: Scots can't share sterling

AUTHOR(S)
James Chapman; Tim Shipman
PUB. DATE
February 2014
SOURCE
Daily Mail;2/14/2014, p2
SOURCE TYPE
Newspaper
DOC. TYPE
Article
ABSTRACT
THE pound is not an asset to be divided up like 'a CD collection' and an independent Scotland will not be allowed to share it, George Osborne declared yesterday. The Chancellor was backed by Labour and the Liberal Democrats as he delivered a stunning blow to Alex Salmond's dream of persuading Scots to break away from the UK. In linked interventions aiming to inflict maximum damage on the 'Yes' campaign, Shadow Chancellor Ed Balls and Lib Dem Chief Secretary to the Treasury Danny Alexander also insisted they would never allow a formal currency union. Meanwhile, in a highly unusual move, advice from the Treasury's top official that sharing sterling would be 'fraught with difficulty' was made public. In a letter to Mr Osborne, Sir Nicholas Macpherson warned that Scotland's banking sector is too big in relation to national income, and the UK could end up having to bail the country out. He added: 'I would advise against a currency union with an independent Scotland.' The declarations by the three parties mean that if an independent Scotland kept sterling, it would be reduced to the position of a country like Panama, which uses the US dollar but has no say over its management. Scottish Nationalists reacted with a threat to default on their part of the national debt if they win the vote in September. Deputy First Minister Nicola Sturgeon accused Mr Osborne of 'bluffing' and claimed that he would moderate his position if Scots did back independence. But Mr Osborne insisted that while independence would expose Scotland to bigger economic risks, a currency union would oblige taxpayers in the rest of the UK to bail them out if things went wrong. That prospect was 'patently absurd', the Chancellor said in a speech in Edinburgh. 'If Scotland walks away from the UK, it walks away from the UK pound. 'The SNP says Scotland will share the pound. That is not going to happen.' SNP leader Mr Salmond said it was 'a concerted bid by a Tory-led Westminster establishment to bully and intimidate'.
ACCESSION #
94412182

 

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