Rejection of currency union with Scotland criticised

Key reasons put forward by the UK Government for rejecting a currency union with an independent Scotland are "unsubstantiated", an economics expert has said.

Live updates

Decision over Scotland currency union 'will not change'

The Treasury has rejected criticism of its opposition to a currency union with an independent Scotland. In a statement, a spokesman said:

The UK Government has set out detailed analysis supported by numerous independent voices as to why a currency union is not in the interests of an independent Scotland or the remaining UK.

This decision is not going to change. This means less than six months from the referendum the Scottish Government still has no plan for what currency they would use.

Currency rejection criticism 'demolishes' Treasury view

The UK Government analysis to date has overstated the risks of currency union with an independent Scotland, a spokesman for the First Minister has said. The spokesman for Alex Salmond added that the report "totally demolishes" the Treasury's argument against a shared currency.

As the Fiscal Commission Working Group has pointed out, the UK Government analysis to date has overstated the risks but failed to fully capture the benefits of formal monetary union.

With the Osborne-Balls alliance, Project Fear has been losing the political argument. Now they're losing the fiscal argument too.

Advertisement

Currency union with Scotland rejection questioned

Key reasons put forward by the UK Government for rejecting a currency union with an independent Scotland are "unsubstantiated", an economics expert has said.

Chancellor George Osborne cited Treasury advice when he ruled out sharing the pound in this year's Scottish independence referendum, but the arguments "cannot withstand" scrutiny, according to Leslie Young, economics professor at the Cheung Kong Graduate School of Business in Beijing.

Currency union with Scotland rejection questioned Credit: PA

The Scottish Government has put forward plans for the country to retain the pound if there is a Yes vote in September, arguing this would be to the benefit of both Scotland and the rest of the UK.

Professor Young said: "There may be good reasons for the UK to reject a currency union with an independent Scotland, but none can be found in the Treasury letter. Yet, that letter is the key justification for the stance of the UK Government."

Back to top