World

Actions

U.K. Leaders Won't Share Currency With Independent Scotland

U.K. party leaders are putting pressure on pro-independence Scottish leaders by announcing their nation wouldn\'t continue sharing its currency.
Posted at 7:55 PM, Feb 12, 2014

U.K. leaders from all three major political parties say they will no longer share their nation's currency with Scotland if the northern country gains independence.

The BBC had the story first, reporting U.K. Chancellor George Osborne would make that promise public this week. Prime Minister David Cameron hinted at the announcement in a Tuesday news conference.

CAMERON: "I think it would be very difficult to justify a currency union post-independence."

The U.K.'s refusal to keep sharing the Pound sterling will complicate Scottish independence efforts. Scots will vote in a referendum in September, and the Scottish ministers pushing for separation had assumed they'd keep the currency.

Deputy Scottish First Minister Nicola Sturgeon says the decision is a bluff meant to scare Scots into a "no" vote on independence.

STURGEON: "This is a campaign tactic. It's a maneuver. It's a panicky reaction to the polls."

Now, if Scotland did vote for independence from the U.K. and if Westminster follows through on its promise not to share its currency, this would have several almost immediate consequences for both sides.

Scotland's pro-independence leaders say the U.K. taking the currency all for itself would also mean shouldering all the debt accrued with sterling. (Via The Guardian)

U.K. leaders say Scotland would then be defaulting on its own debt, making interest rates higher for Scots with credit cards and mortgages. (Via BBC)

There's also a question of whether George Osborne, as chancellor, is qualified to make this decision, or whether it will need to be put to the U.K.'s Parliament. (Via Wikimedia Commons / Chatham House)

Either way, with this announcement from Westminster, it will be tougher for the pro-independence movement in Scotland to continue promising a seamless post-separation financial transition for its citizens.