Independence – a bare knuckle fight?

Scotland would ‘walk away’ from the pound after a ‘Yes’ vote

So – the gloves are off. The Westminster politicians have changed their tactics – from charm offensive to plain offensive. And it’s all happened so quickly.

David Cameron Stay - for the sake of the family
David Cameron
Stay – for the sake of the family
First, we had the Prime Minister choosing the rather curious location of the velodrome in London’s Olympic Park to send out an ‘emotional, patriotic’ appeal to Scots to stay in the union. David Cameron stressed that he wanted Scots to realise that people in England, Wales and Northern Ireland were not looking the other way. As his put it, “it’s so important for Scotland to realise that the rest of the family see this as a very important family decision.”

Shortly before that, the Governor of the Bank of England, Mark Carney, had been to Edinburgh where he didn’t appear to rule out the prospect of a currency union after a ‘Yes’ vote in September. What he DID say was that an independent Scotland would need to give up some power to make such a currency union UK work. Again in his words, the proposal from the Scottish Government “requires some ceding of national sovereignty”.

Thus far, so friendly! Then the Chancellor, George Osborne, comes to town. His message was rather like Margaret Thatcher at an EU Summit – No, No, NO! He insisted that a vote for independence would mean Scotland walking away from the pound. Indeed, he said that was “no legal reason” why the rest of the UK would want to share sterling with an independent Scotland.

George Osborne Why would the rest of the UK want to share the pound?
George Osborne
Why would the rest of the UK want to share the pound?
“When the Nationalists say the pound is as much ours as the rest of the UK’s,” he asked, “are they really saying that an independent Scotland could insist that taxpayers in a nation it had just voted to leave had to continue to back the currency of this new, foreign country? Had to consider the circumstances of this foreign country when setting their interest rates? Stand behind the banks of this foreign country as a lender of last resort? Or stand behind its foreign government when it needed public spending support?”

What made this speech more important in the independence debate than that (say) of David Cameron was a series of hints that this was not his view alone. The Chief Secretary to the Treasury, the Liberal Democrat MP Danny Alexander, appears to support Mr Osborne’s position, as indeed may Labour’s shadow chancellor, Ed Balls.

It would therefore seem that the politicians from London are playing ‘good cop, bad cop’. But the risk they run is a hardening of feeling on both sides. After all, the Deputy First Minister, Nicola Sturgeon, has warned that if UK ministers decided to hold to this position, then an independent Scotland could retaliate by refusing to accept a share of UK debt.

It doesn’t bode well for the likely tone of the Independence Referendum campaigns as we move towards September.