Carney enters Scots currency debate

Written By Unknown on Rabu, 29 Januari 2014 | 15.36

28 January 2014 Last updated at 20:49 ET By Andrew Black Political reporter, BBC Scotland

The Bank of England governor will enter the Scottish independence debate by reflecting on the currency implications of a "Yes" vote in the referendum.

Mark Carney's speech in Edinburgh has come amid continuing speculation over the Scottish government's plan to keep the pound under independence.

SNP ministers would also want to retain services of the Bank of England as part of a currency union.

The UK government has said such an agreement would be "unlikely".

Mr Carney's visit comes ahead of the 18 September independence referendum, in which voters will be asked the yes/no question: "Should Scotland be an independent country?"

As well as being a guest at an event hosted by the Scottish Council for Development and Industry, the governor will also meet with Scottish First Minister Alex Salmond.

In its White Paper blueprint for independence, the Scottish government said a currency union agreement was vital in letting companies go about their business, while sterling would also benefit from Scotland's continued involvement because of assets such as North Sea oil and gas.

But UK ministers have said such a deal would result in Scotland effectively having to hand over control of interest rates and borrowing levels to a foreign country.

Mr Carney, who has agreed to provide "technical, objective, dry analysis" of the issues ahead of the referendum, told the BBC last week: "There are issues with respect to currency unions. We've seen them in Europe.

"It's one of the factors that affects, actually, the outlook for the UK economy, has affected us over the last five years, affects us going forward, the challenges of having a currency union without certain institutional structures."

The event in Edinburgh comes the day after Mr Salmond said he was told by Mr Carney's predecessor - Sir Mervyn King - that the Treasury would adopt an "entirely different" approach to Scottish issues if there was a "Yes" vote in the referendum.

'Remarkable coincidence'

Ahead of discussions with the Bank of England governor, the first minister said: "When I met his predecessor a couple of years back, Mervyn King, the first thing he said to me was 'your problem is what they say now', meaning the Treasury, 'and what they say the day after a Yes vote in the referendum are two entirely different things'."

Responding to Mr Salmond's comments, a spokesman for the official campaign to keep the Union, Better Together, said it was a "remarkable coincidence" that Sir Mervyn's reported remarks backed up the Scottish government's position.

A spokesman said: "The first minister operates on the basis that people are daft and can't see through his bluster.

"Unfortunately for him, people know when someone is at it."


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