Swinney under pressure to
Opposition parties demand a full explanation over sterling statement
JOHN Swinney last night faced calls to apologise after the Bank of England dismissed his claims that it had discussed with the Scottish Government an independent Scotland keeping the pound.
The finance secretary has also been urged to make a full statement to parliament next week to explain his claims after they were disputed by the UK’s central bank.
The row erupted when the Bank of England took the highly unusual step of issuing a statement which took issue with comments made by Mr Swinney.
Mr Swinney’s claim was made earlier this week when he reacted to a warning by the Bank of England Governor Mark Carney that the Scottish Government’s plans for a currency union threatened financial stability.
The finance secretary remarked that: “The Scottish Government has had technical discussions with the Bank of England regarding our proposal for a currency union.”
His comment was later con- tradicted by the Bank of England which said: “To be clear, consistent with its statement in December 2012, the Bank of England has not entered into discussions with representatives of the Scottish Government about proposals for future monetary arrangements in Scotland.”
The statement added that discussions with the Scottish Government had been limited to answering “technical questions” and added: “The Bank of England did no more than answer technical questions from representatives of the Scottish Government. We have not entered a dialogue about the possibility of changing monetary arrangements for Scotland in future.”
The Bank’s denial of Mr Swinney’s claims are embarrassing for the Scottish Government at a time when Alex Salmond’s currency policy is under intense attack.
Mr Salmond has insisted that an independent Scotland will be able to keep the pound in a formal currency union which involves sharing the Bank of England as a lender of last resort with the rest of the UK.
Labour, the Conservatives
Last night, the Scottish Government was dismissive of the idea of a parliamentary statement.
A Scottish Government spokesman said: “We have had ongoing technical discussions with the Bank of England, as the Bank itself has previously confirmed.
“These technical discussions were inaugurated by former Governor Mervyn King and continued under the current Governor Mark Carney, as confirmed in the statement issued after the meeting between the First Minister and Mr Carney on January 29th this year, which was agreed by the Bank.
“We have always made clear that these are technical discussions and not negotiations, and that we respect the neutrality and independence of the Bank, which had made clear it will implement whatever is agreed.
“Any request for a ministerial statement in relation to this matter will be considered by the Parliamentary Bureau.” and the Liberal Democrats have all ruled out a such a currency union, arguing that such an arrangement would not be in the best interests of the UK.
The SNP’s opponents yesterday attempted to pile the pressure on the Scottish Government’s position. Labour said Mr Swinney should apologise, while the Tories called for a statement to be made at Holyrood.
Scottish Labour’s finance spokesman Iain Gray said: “Yesterday the finance minister was rebuked by our central bank and we have not heard a word from him. He sends out an anonymous spokesman to defend him and has avoided the TV studios. John Swinney sought to give the impression that he was in talks with the Bank of England about sharing the pound if Scotland leaves the UK. The Bank issued an unprecedented statement making it clear no such discussions had taken place.”
Mr Gray added: “Where is John Swinney? He must be mortified after being rebuked by the Bank but, as a public servant, he must explain himself. Why hasn’t he appeared to explain and apologise for misleading Scots on the currency?”
Gavin Brown, the Scottish Conservative finance spokesman, joined the attack. Mr Brown said “There are serious questions to be answered by the Scottish Government.
“That is why we have formally requested a ministerial statement to parliament at the earliest available opportunity.
“This is an extraordinary situation, where the neutral Bank of England has taken the step of issuing a statement which contradicts a claim made by the Scottish Government about their plans for independence.”