Scottish independence referendum: An independent Scotland ‘could keep the pound’

Moore said he saw no legal problem, but added there would be consequences for spending and borrowing.

It comes after Chancellor George Osborne last week refused to say whether Scotland would be able to retain sterling.

Mr Moore made the comments as he asked the First Minister to meet him in Edinburgh this week for talks on the independence referendum.

Appearing on the BBC’s Politics Scotland show today, Mr Moore was asked: “Do you accept that Scotland has the legal right to continue using sterling post independence? That cannot be in dispute.”

He replied: “If that is part of the deal that the independence section of the debate wanted - I don’t think there’s a legal problem with that.

“But you do have to very quickly think about the consequences of who would set interest rates, about what it would mean for your spending plans and your borrowing plans and routinely when I’ve heard senior nationalists, including the First Minister asked about this point, they don’t actually get onto that.

“What would be the point in setting yourself up as a foreign country with less influence over that interest rate setting policy than you do at the present time when you’re part of that country.”

Mr Moore said the UK Government wants to provide Holyrood with the legal powers for a fair and decisive referendum.

He said he had already spoken with Mr Salmond proposing talks, and would suggest a meeting in Edinburgh on Thursday.

He said: “I think it’s important that we should get on and discuss what we will do to make sure here in Scotland we create a referendum on the biggest decision we’ll ever take in our lives here in this country and make sure it’s legal, that it is fair and that it’s decisive.”

Under Westminster’s proposals a referendum could be held within 18 months on the single yes-or-no question of whether Scotland should become independent of the United Kingdom.

No date has been suggested for the poll, though ministers are prepared to set a deadline once the consultation ends on March 9.

Edinburgh wants to delay a poll until autumn 2014 and to leave open the possibility of a third “devo-max” option on the ballot paper, which would allow Scotland to take on greater self-determination in financial matters but remain part of the Union.

Mr Salmond wants to put the referendum question - or questions - to the test in a ballot overseen by a Scottish body.

Under Westminster proposals a referendum would be overseen by the Electoral Commission.

However Mr Moore today said he would ensure that the Electoral Commission reports to Holyrood.

Mr Salmond said he was happy to meet Mr Moore but that he wants to talk with those making the decisions.

He told the programme that Downing Street appears “unkeen” for him to have a meeting with Prime Minister David Cameron to discuss the issues.

On the currency issue, he said: “Our position is let’s use sterling until we’re able to take a decision on the Euro.”

He added: “The UK Government can’t stop an independent Scotland using sterling. Sterling is not owned by George Osborne.

“Sterling is a fully convertible currency. He couldn’t possibly instruct people not to use sterling.”