SNP stance on EU and currency union post indy, backed by experts

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  By Chris Rumbles
 
Two leading academics in economic governance have said a formal currency union between Scotland and the rest of the United Kingdom in a post-independence environment is the most ‘feasible’ and ‘likely’ option.
 
Professor Charlie Jeffery, a Professor of Politics at the University of Edinburgh, and Professor David Simpson, former chief economic adviser to Standard Life, both gave written submissions to the Scottish Parliament’s Economy, Energy and Tourism Committee inquiry into Scotland’s economic future post-2014.

Excerpts from Prof Jeffery’s submission made it clear that the academic viewed the pro-union camp’s conception of an independent Scotland as one that served as “an element of tactics” to “convey a sense of high risk and strong uncertainty”.

Though Prof Jeffery admitted that the “economic consequences of independence are not knowable with precision”, he also warned of partisan rhetoric that claimed “certainties where none exist”.

On the subject of EU membership and Commissioner Jose Manuel Barroso’s recent comments, Prof Jeffery added: “Contrary to Barroso, the conclusion of almost all independent expert analysis is that Scottish EU membership would be uninterrupted, though the process of attaining membership as an independent state and the terms of that membership would likely be subject to difficult negotiations.”

Standard Life announced last week that they would take “whatever action necessary” to ensure their business was unaffected by a Yes vote in September.  This statement was highlighted by the pro-Union camp as being further evidence of the negative impact independence would have.

The written submission given by Prof Simpson, Standard Life’s chief economic adviser for twelve years until 2001, contrasted the Standard Life comments which some regarded as a rejection of independence.

In his submission Prof Simpson said: “A currency union based on sterling remains the most likely outcome following independence because it is in the best interests of not just Scotland but of England as well.”

Prof Simpson also stressed the fact that a currency union would remove transaction costs and exchange rate risks while enhancing the overall financial stability of both parties.

The contribution to the economic aspects of the independence debate from two academic authorities has been welcomed by Highlands and Islands SNP MSP Mike MacKenzie:

“Professor Jeffery and Professor Simpson are the latest experts to back the common sense positions of a currency union and continuing EU membership after a Yes vote.

“These sensible, evidence-based interventions from well-respected experts are a welcome contrast to the No campaign’s ‘Dambusters Strategy’.”

Last month the Scottish Government’s economic advisory body the Fiscal Commission Working Group published a report recommending a shared currency union which would benefit Scotland and the rest of the UK.

The report also echoed the calls of the House of Lords Economic Affairs Committee by saying political considerations should be put to one side so that practical negotiations occur before the referendum.