SNP economic group to '˜recommend creation of Scottish pound'

An economic advisory group set up by Nicola Sturgeon in the wake of the Brexit vote is set to recommend that an independent Scotland launches its own currency, one of the party's former MPs has said.

SNPs Growth Commission are expected to propose the creation of a Scottish pound. Picture: John Devlin
SNPs Growth Commission are expected to propose the creation of a Scottish pound. Picture: John Devlin

George Kerevan, a former member of the House of Commons Treasury Select Committee, said “little birds” had told him the SNP’s Growth Commission is going to propose the creation of a Scottish pound.

The Commission, which is being chaired by former SNP MSP Andrew Wilson, has been tasked with exploring the possible economic policies of an independent Scotland.

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The group of 14 economists, business leaders and politicians was set up by Ms Sturgeon in September last year and has been exploring how to grow Scotland’s economy after Brexit.

The Commission’s final report is now thought to be nearing completion, with Mr Kerevan saying a 400-page document with “three chunky appendices” had been delivered to the First Minister.

“Let us say it loud and clear: in arguing the case for independence in the next referendum, a basic red line is that Scotland has its own currency, sets its own interest and exchange rate, and regulates its own banks,” the former MP for East Lothian wrote in the National newspaper.

“The Growth Report, according to some little birds, might be proposing a separate Scottish currency but keeping our exchange rate tied to sterling as an interim measure. In other words, a Scots pound would equal one English pound.”

Mr Kerevan said he was unconvinced by this proposal, claiming that it could be seen as “keeping sterling in disguise”. He added that the case for independence ahead of 2014’s referendum had been “fatally wounded” by the proposal that Scotland would keep the UK pound.

“The London markets would immediately test the will of the Scottish Central Bank to keep the Scots and English pounds equal by flogging off ours, thus draining our reserves,” he wrote. “Why give them a hostage to fortune?”

The former MP called on Ms Sturgeon to publish the findings of the Growth Commission as soon as possible, with the aim of setting off a “wider public debate” within the SNP and the independence movement.

However, he added that the First Minister would probably delay the publication until next year, as she would not want to distract from the Scottish Government’s draft Budget for 2018-19, due to be published in December.

Asked for an update on the progress of the report in August, Ms Sturgeon said it was still unfinished but insisted that she was planning to publish it “in full”.