The independence battle escalated yesterday as the SNP threatened to walk away from Britain’s debts over claims that pro-UK parties were “bullying and intimidating” Scots.
The bitter war of words erupted on the eve of a major speech in Edinburgh today by Chancellor George Osborne, who is expected to completely rule out a currency union with an independent Scotland.
The move, understood to be backed by the chancellor’s Labour counterpart Ed Balls and Liberal Democrat Danny Alexander, would aim to pile the pressure on the SNP to produce an alternative plan to keeping the pound.
However, Scottish Deputy First Minister Nicola Sturgeon claimed it was a “bluff” by the chancellor which would “backfire spectacularly”.
She also issued a warning that such a decision would “leave them having to pick up the entirety of UK debt”, as “assets and liabilities go hand in hand”.
The row dominated a Westminster debate on the currency issue on Tuesday with Labour’s Ian Murray saying: “People need to know what money will be in their pockets, we can’t run a modern economy on empty ginger bottles.”
SNP MP Stewart Hosie responded by branding the remarks “patronising and insulting”.
Publishing what has been billed as a “new analysis of the currency question”, Mr Osborne was expected to say that he wants Scotland to keep the pound “and the economic security that it brings” but added that it could only happen as part of the UK.
The chancellor was expected to say: “Today Scotland is one of the most economically successful parts of the UK, with growth per head the same as the smaller independent European states the nationalists would like Scotland to join, but with far more stability and less volatility than them, thanks to being part of the wider UK.”
Bank of England governor Mark Carney warned last month that the type of currency union favoured by the SNP would require an independent Scotland giving up some powers to the rest of the UK.
Nationalists claim the pro-UK camp’s position on Sterling would be reversed after a Yes vote in September, because forcing Scotland to change its currency would penalise English companies who do business north of the border.
Ms Sturgeon said: “Mr Osborne’s position is also a bluff. For him to stick to this position after a Yes vote would put Westminster vastly at odds with majority public opinion across Scotland and the rest of the UK, it would cost their own businesses hundreds of millions of pounds a year, it would blow a massive hole in their balance of payments and it would leave them having to pick up the entirety of UK debt.”
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