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Scottish independence: Osborne tells MPs currency union has been 'ruled out' Scottish independence: Osborne tells MPs currency union has been 'ruled out'
(about 1 hour later)
Chancellor George Osborne has again insisted that a currency union after Scottish independence would not work and has been "ruled out".Chancellor George Osborne has again insisted that a currency union after Scottish independence would not work and has been "ruled out".
Mr Osborne is appearing before MPs on the Scottish affairs committee. Mr Osborne told MPs that this was a "no ifs, no buts" position.
Its chairman Ian Davidson told the BBC he and his fellow members wanted to explore all of the arguments. He said he wanted Scotland to keep the pound but this would only happen if the UK stayed together.
The SNP's Treasury spokesman Stewart Hosie said Mr Osborne's stance on sterling was "bluff and bluster" ahead of the independence vote in September. The SNP's Treasury spokesman, Stewart Hosie, said Mr Osborne's stance on sterling was "bluff and bluster" ahead of the independence vote in September.
Mr Hosie said he believed that not having a shared pound post-Yes would threaten jobs and damage trade in the rest of the UK. The chancellor appeared before Westminster's Scottish affairs committee, which is being boycotted by the SNP, to discuss his opposition to a currency union.
The chancellor has been joined by the Permanent Secretary at the Treasury, Sir Nicholas Macpherson, for his appearance before the committee, which is being boycotted by the SNP. Mr Osborne insisted that "there were no circumstances under which we could recommend a currency union to the people of the United Kingdom".
Pressed by Mr Davidson, Mr Osborne insisted "there were no circumstances under which we could recommend a currency union to the people of the United Kingdom". He said: "As Chancellor of the Exchequer it is my obligation to explain that no currency arrangement under independence will be the same as the strength and stability of one UK, with one UK pound.
He denied a suggestion by the Labour chairman of the committee that his speech in Edinburgh ruling out a currency union had been a "presentational disaster" which had diverted attention from the substance of the referendum debate. "The people of Scotland deserve straight answers to straight questions and you have had straight answers from the Labour shadow chancellor, the Liberal Democrat chief secretary and from me, the Conservative chancellor.
And he rejected the allegation that UK ministers have engaged in "bluff and bluster", which has been made by First Minister Alex Salmond. "We have all made it clear that there will be no currency union if Scotland becomes independent, no ifs, no buts.
Mr Osborne told MPs: "Alex Salmond should look in the mirror when he makes those accusations because he is not being straight with the Scottish people." "An independent Scotland would not share the pound with the rest of the UK."
'Exceptional circumstances'
He denied a suggestion by committee chairman Ian Davidson that his speech in Edinburgh ruling out a currency union had been a "presentational disaster" which had diverted attention from the substance of the referendum debate.
Mr Davidson, a Labour MP, said: "It looked as if it was some English Tory coming up to tell us what we could and couldn't do."
And Mr Osborne rejected the allegation that UK ministers have engaged in "bluff and bluster", which has been made by SNP politicians, including First Minister Alex Salmond.
He told MPs: "Alex Salmond should look in the mirror when he makes those accusations because he is not being straight with the Scottish people."
He added that a currency union would not be in the interests of the UK or an independent Scotland.He added that a currency union would not be in the interests of the UK or an independent Scotland.
"Ultimately you'd be asking UK taxpayers to provide a safety net to a separate country," he said, adding that the people of Scotland would be "tying themselves to the economic decisions of another country"."Ultimately you'd be asking UK taxpayers to provide a safety net to a separate country," he said, adding that the people of Scotland would be "tying themselves to the economic decisions of another country".
Earlier, Mr Hosie told BBC Radio Scotland's Good Morning Scotland programme: "Scotland, of course, being the rest of the UK's largest export market anywhere in the world after the US, why would George Osborne have such a strange view on a currency union that puts that trade from the rest of the UK to Scotland at risk? Treasury permanent secretary Sir Nicholas Macpherson joined the chancellor in front of the committee and faced questions about why he took the unusual step of making his civil service advice on currency public.
Sir Nicholas denied he had been pushed by Mr Osborne and rejected accusations he had abused his position, arguing there were "exceptional circumstances".
He said: "If I thought it was the wrong thing to do, to publish it, I simply would not have done it.
"This was very much my idea and I think it was the right thing to do."
'Political posturing'
Mr Hosie said he believed that not having a shared pound post-Yes would threaten jobs and damage trade in the rest of the UK.
He told BBC Radio Scotland's Good Morning Scotland programme: "Scotland, of course, being the rest of the UK's largest export market anywhere in the world after the US, why would George Osborne have such a strange view on a currency union that puts that trade from the rest of the UK to Scotland at risk?
"It would threaten and damage jobs in England, it would threaten and damage sterling and balance of trade terms which is why Osborne's comments are bluff, are bluster and are simply political posturing in the run up to September's vote.""It would threaten and damage jobs in England, it would threaten and damage sterling and balance of trade terms which is why Osborne's comments are bluff, are bluster and are simply political posturing in the run up to September's vote."
'Transactional costs' In February, Mr Osborne and the finance spokesmen for Labour and the Liberal Democrats ruled out a currency union between an independent Scotland and the rest of the UK.
But ahead of chairing the committee meeting, Labour MP Mr Davidson spoke to the same programme about what he believed the Chancellor had considered before ruling out a currency union.
He said: "Do the disadvantages of incurring transactional costs prove greater than the demerits of having a shared currency?
"Because if he [Mr Osborne] has come out with this position, presumably he has considered it greatly, he has decided that the balance of advantage is against the shared currency.
"And partly, of course, because it would require a fiscal and banking union and it is difficult to see from the articles that he [Mr Osborne] has produced what would actually be in it for England, Wales and Northern Ireland."
Earlier this year, Mr Osborne and the finance spokesmen for Labour and the Liberal Democrats, ruled out a currency union between an independent Scotland and the rest of the UK.
At the same time, senior civil servant Sir Nicholas made his advice on the topic public.At the same time, senior civil servant Sir Nicholas made his advice on the topic public.
The Scottish government wants a monetary union with the rest of the UK in the event of a "Yes" vote in September's referendum.The Scottish government wants a monetary union with the rest of the UK in the event of a "Yes" vote in September's referendum.
When voters in Scotland go to the polls on 18 September they will be asked the "Yes/No" question: "Should Scotland be an independent country?"When voters in Scotland go to the polls on 18 September they will be asked the "Yes/No" question: "Should Scotland be an independent country?"