Alistair Darling warning on SNP plan for sterling
THE SNP’S flagship plans for a “sterling zone” currency union after independence are likely to be rejected by the remaining UK countries, former Chancellor Alistair Darling will argue today.
But he will be accused of peddling “myths” about independence by finance secretary John Swinney, who will say the last Labour government presided over an “unsustainable boom” which benefited the few, not the many.
Mr Darling, who will lead the pro-union campaign in the referendum campaign, says the fear of a eurozone-style meltdown will thwart any hopes of a currency union with London built around the pound after Scottish independence. The alternative of Scotland simply using the pound would be more like “serfdom, than freedom”, Mr Darling will say.
He will make his most powerful defence of the union so far today at The Scotsman conference on the Economics of Independence.
But Mr Swinney is expected to say that UK governments of the last thirty years, including the last Labour administration, failed to “maximise Scotland’s potential”, while devolution has shown that a Scottish Government can deliver.
Ahead of today’s keynote speech, Mr Darling said: “The advantage to us at the moment is that we have the pound, there are no transaction costs, no risks exchange rates would vary and it’s giving us the flexibility now in contrast to what’s happening in the eurozone.”
He warned that the SNP’s plans for a sterling zone mean effectively asking the rest of the UK to “give up” its currency in order to make it a common currency with Scotland.
“I think if you said to your average Englishman, Welshman or Northern Irishman, do you want to give up the pound and make it a common currency with Scotland, they’d say hold on, not without asking us first,” Mr Darling added.
“I’m pretty sure that in a straw poll, or even a proper poll, in any of the three remaining parts of the UK, you would get a resounding no. They’d say, ‘You want to leave, well you take the consequences’.”
The SNP has ruled out the creation of a separate Scottish currency. Mr Darling said Scotland would be left using sterling in the same way a country like Panama uses the US dollar.
“That means you have to make whatever changes are suitable to keep up with the rest. Your interest rates are set by a foreign country, the value of your currency is set by a foreign country.
“It makes no sense – that’s not freedom, it’s serfdom.”
He argued that the current turmoil in the eurozone also shows that a common currency means ever-closer political ties and “ultimately political union”.
“You would be in the absurd situation of having gone through all the trauma and disruption and cost of leaving the UK, only to arrive back in the same place a few years later.
“I think that policy is foolish. It’s a complete failure to understand the consequences of what they’re doing.”
The free movement of goods and people, as part of one of the largest members states in the European Union, are among the key arguments for keeping the UK as it is, unionists argue. That leaves Scotland with more influence than a small country, and includes shared risks over issues such as bank failure.
Mr Darling added: “What worries me is the risk. At at time when we’re in the most uncertain time in the last 70 years, to be taking a decision when they can’t answer some basic questions, seems to me to be total madness.”
Mr Swinney will launch a defence of the Scottish Goverment’s economic record, saying previous administrations failed to “maximise Scotland’s potential”.
“Over the past 30 years up to the financial crisis, growth in Scotland averaged 2.1 per cent against 2.7 per cent in other comparable small EU countries and the wealth we have achieved for the UK has not been shared,” Mr Swinney will say.
“Such figures are all the more frustrating as, despite a period of unprecedented growth in the global economy, the previous UK government missed a once-in-a-lifetime opportunity to deliver a real improvement in prosperity and social equality. Instead, growth was squandered on an unsustainable boom that benefited the few rather than the many.
“Those who argue the case against independence will perpetrate myths about Scotland’s ability to operate as an independent nation.”
He will add that as an independent nation, Scotland would have “the tools needed to tackle inequality and deliver better economic opportunities”.
The SNP last night released a list of decisions taken by Mr Darling as Chancellor, which it says went against the wishes of people across Scotland.
This includes withholding the fossil fuel levy and confirming the closure of 2,500 post offices.
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Saturday 25 May 2013
Temperature: 6 C to 17 C
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Temperature: 9 C to 16 C
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