No campaign blow as Bank of England Chief confirms indy contingency plans in place

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  By Martin Kelly
 
The Governor of the Bank of England has confirmed that there are contingency plans in place should Scotland become independent.
 
In a carefully worded announcement today, Mark Carney said: “It’s never good to talk about contingency plans in public other than to assure that we have contingency plans,”

The BoE Chief added: “In terms of our responsibilities for financial stability – we have a wide range of tools and plans.”

Mr Carney’s remarks are believed to be aimed at easing concerns inside the financial markets over worries should Scots vote Yes in September.  They follow a week in which threats from the three London parties over a currency union with an independent Scotland have dominated the media.

The comments from Mr Carney are a huge blow to the No campaign which has insisted that there will be only one outcome in terms of using the pound and the Bank of England should Scots vote Yes in September’s referendum.

The Labour party has joined with the Conservatives and the Lib Dems in insisting the rest of the UK will continue to use the pound.  All three parties have claimed there will be no deal with an independent Scotland over any currency arrangements.

Confirmation from the Bank of England Chief that contingency plans are in place contradict claims from the UK Government that it is making no such plans in the event of independence.

Mr Carney also said: “I will reiterate that we will implement whatever we’re asked to implement and I’ll add further, if I may, that we also have responsibilities, as you know, for financial stability in the United Kingdom and we will continue to discharge those responsibilities until they change.

“We will continue to discharge those responsibilities regardless of the outcome of the vote on the 18th September.”

Asked whether a currency union would happen and Mr Salmond needed a Plan B, Mr Carney said the Bank of England has “operational independence” over monetary policy.
 
Scottish Finance Secretary John Swinney said the governor had confirmed that the Bank of England would remain responsible for the currency and financial stability of Scotland and the rest of the UK in the event of a “Yes” vote.

Welcoming Mr Carney’s intervention, Mr Swinney added: “This also shows why it is in the best interests of the rest of the UK to continue with a currency union on independence.

“The Scottish government is clear that an independent Scotland will use the pound and we will do so in a currency union – any suggestion otherwise is just bluster, as confirmed by the senior UK minister who has admitted that ‘of course’ there will be a currency union following a Yes vote.

“Mr Carney’s calm and considered comments are a sharp contrast to the scaremongering and threats of UK politicians.”

Unionists though have seized on Mr Carney’s reassurance that the Bank of England will implement whatever it is asked to implement, arguing that their current stance of no currency agreement will be the outcome.

Alistair Darling, the head of the Better Together campaign said: “The governor has confirmed that a currency union would not work without shared taxation and spending, the very things that Alex Salmond wants to dismantle with a Yes vote.

“Mark Carney also confirmed that he will implement the decisions of the UK parties who have ruled out a currency union.

“The money we would use if we vote for independence isn’t an academic matter, it is critical to everyone in Scotland. Alex Salmond has got to come clean and tell us what Plan B is.”