Navigating the currency debate
Published: 3 April 2014
Author: Coree Brown Swan
The UK government's publicly declared stance ruling out a currency union with any independent Scotland has been in the spotlight in recent days, and called into question. This follows the Guardian reporting an unnamed government minister as saying; 'Of course there would be a currency union,' noting 'There would be a highly complex set of negotiations after a yes vote, with many moving pieces. The UK wants to keep Trident nuclear weapons at Faslane and the Scottish government wants a currency union – you can see the outlines of a deal'
George Osborne and Danny Alexander have denied these remarks, saying that 'There will not be a currency union in the event of independence. The only way to keep the UK pound is to stay in the UK. Walking out of the UK means walking out of the UK pound. A currency union will not work because it would not be in Scotland's interests and would not be in the UK's interests.'
Deputy First Minister Nicola Sturgeon challenged the statement 'Now that the card has been withdrawn, it gives an even bigger boost to the yes campaign. And it can only add to the sense of crisis which is engulfing the no campaign'.
While the debate continues in the political space, our analysts have provided research about the prospects and practicality of a currency union. View our series of currency reflections, published in response to the Chancellor's February statements on currency and the National Institute of Economic and Social Research Report on Scotland's Currency Options,
Programme fellow Michael Keating also weighed in on the issue in The Conversation, arguing that the SNP's stance on currency is a difficult one, 'It’s really not convincing for the Scottish Government to say rUK [the remaining UK] will give way and share the currency with us anyway. It leaves them in a weak position in negotiation if they do not have a fall-back''
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