The party will today formally seek adopt a stand-alone Scottish currency as official policy after independence – ditching the 2014 proposal to keep the pound in a formal currency union with the UK.
It comes as a new poll shows that almost three-quarters of people in Scotland want to keep the pound, while just one in eight are in favour of a new Scottish currency. First Minister Nicola Sturgeon fired the starting gun on a second independence referendum last week as she told MSPs in a Holyrood address that she would seek to hold one within two years to give Scots an alternative to the chaos of Brexit.
Left-wing activists are seeking a quickfire move to separate Scottish currency after independence and will challenge the leadership’s plan to have six stringent fiscal tests before the switch to a new currency at the SNP spring conference in Edinburgh today.
In the interim period, Scotland would continue to use the UK pound, in the same way that Panama uses the US dollar.
Finance Secretary Derek Mackay, who is bringing forward a motion setting out the new economic case aimed at winning a Yes vote, said it presents a package “to win the economic arguments over independence”.
He added: “To build confidence in that case among the people of Scotland, to stand the best chance of winning independence, Conference should back this plan in its entirety.
“From there we can get on with the task of taking our campaign to the doorsteps and winning that better future.”
Without the fiscal tests, it is feared the new currency could nosedive and plunge the fledgling state into financial crisis.
The motion today is jointly being proposed by Mr Mackay and deputy leader Keith Brown. It sets out the broader revised economic case for independence, including the currency switch.
Mr Brown warned that to win the case for independence, the Yes campaign “must convince more people” than it reached in the 2014 referendum when 45 per cent of Scots voted Yes. A poll this week suggested this had dropped below 40 per cent.
But activists, led by the former East Lothian MP George Kerevan, oppose the fiscal tests warning that they could take more then a decade to meet. These tests would look at whether Scotland’s debt has been brought under control and the new central bank has the confidence of international markets. They also look at whether enough cash reserves have been built up to support the new currency and if it commands “wide support”.
In the meantime, Scotland would be using the UK pound without any control over monetary policy such as interests rates, prompting claims it would be little more than a “vassal state”.
Mr Kerevan has lodged an amendment which would ditch the tests and adopt a new stand-alone currency during the first Parliament of independence.
A separate amendment backed by MP Ronnie Cowan would remove the requirement to end any fiscal deficit and ensure foreign lenders are satisfied with Scottish tax and spending, amid claims they would lead to austerity cuts.
Mr Kerevan says the amendments would provide a “certain and credible plan” for establishing an independent currency in a reasonable time frame.
He has warned previously: “The Growth Commission’s six tests could leave Scotland using the pound indefinitely, result in cuts to services and spending, and allow the market to dictate an independent Scotland’s decisions.”