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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

to wonder how Scotland's decision will affect england?

980 replies

LEMmingaround · 06/08/2014 20:35

Just that really? If they do go their ownway how will it affect england?

Also will it open a can of worms with wales and northern Ireland?

OP posts:
Thread gallery
6
PhaedraIsMyName · 09/08/2014 23:57

Oh my -that "quote" from Darling changes quite significant when you see the full quote.

caroldecker · 10/08/2014 01:39

rUK would enter a currency union if they coudl agree all tax rates, spending and budgetary issues. This however negates independence, exactly what Mr Darling was saying. The only way to get a currency union is for rUK to dictate the Scottich budget and spending.

PhaedraIsMyName · 10/08/2014 02:37

Numanoid may I ask where you got that wildly out of context quote? Is that official propaganda from the Yes campaign?

ItsAllGoingToBeFine · 10/08/2014 08:48

Good piece in today's Herald about currency union (Iain Macwhirter)

www.heraldscotland.com/mobile/comment/columnists/we-are-not-dimwits-so-stop-scolding-us-about-currency.24999254

PigletJohn · 10/08/2014 09:20

The piece in the Herald mixes up "using the pound" which any foreigner in any foreign country can do if he or she feels like it; and two independent countries agreeing to a Currency Union, which depends on both the independent countries deciding that it is in their own best interests and signing up to agreed terms.

Obviously you can't sign up to a union with someone who doesn't want to unite with you, even if you think they ought to.

saintlyjimjams · 10/08/2014 09:27

That Herald article is ridiculous just sounds like whinging. As for Any way you look at it, for both England and Scotland, a currency union is the most sensible short-term option I'm sorry I don't agree. I can see the benefits for an independent Scotland to remain in a CU, I cannot see how it would benefit the rest of us in the UK - I agree with the opinion that it would be damaging for us.

As I said last night I expect the UK govt to act in the interests of the UK, if that includes Scotland, then their interests should be considered, if it doesn't then why should we be putting their needs above ours.

OOAOML · 10/08/2014 09:53

So has Iain McWhirter moved from run of the mill journalist to political and economic expert then?

Chunderella · 10/08/2014 09:57

This reply has been deleted

Message withdrawn at poster's request.

StatisticallyChallenged · 10/08/2014 10:00

That article isn't good at all IME ItsAllGoingToBeFine.

It also assumes that the currency is an asset. The actual currency reserves i.e. the physical money in the bank, could be argued to be an asset certainly - but the currency itself...see below.

Uk govt analysis (sorry it's long, there wasn't a sensible bit to cut without losing content!):

"It is right to say that the international law principle of equitable division applies to certain UK assets and liabilities and that this principle would be important in any negotiation should Scotland vote for independence. However it is wrong to say that an independent Scotland would be entitled to share the continuing UK’s currency, the UK pound, as part of a formal currency union. There is no rule or principle in international law that would
require the continuing UK to share its currency with an independent Scottish state. The system of currency used by a country is not part of its assets, as is explained below.

In the event of Scottish independence, the UK (without Scotland) would be the continuing state in international law. A detailed legal opinion from world-leading experts Professor James Crawford and Professor Alan Boyle was published with Scotland analysis: Devolution and the implications of Scottish independence, which set out at length a number of consequences that would arise from this position.

A.5 As a continuing state the UK’s laws and institutional framework would continue uninterrupted by Scottish independence. National institutions currently serving the people of the UK, such as the Bank of England and central government departments, would continue to carry out functions in the continuing UK and deliver services to the people of the continuing UK as before. Such institutions would have no jurisdiction in Scotland and
no power or obligation to act on behalf of an independent Scottish state. This means the Bank of England, as a UK institution, would remain the central bank for the continuing UK but not a new Scottish state. So it would only issue currency and set interest rates for the continuing UK and not for Scotland.

A.6 The position is quite different in relation to the UK’s assets and liabilities. The relevant assets and liabilities would, according to international law principles, fall to be equitably divided between the continuing UK and an independent Scottish state. The apportionment
of the UK’s assets and liabilities would likely constitute a large part of the separation negotiations that would necessarily follow a vote for independence.

What this means for the UK pound as a currency
A.7 It is important to be clear what the UK pound as a currency is and why it is not an asset. A currency is a system of exchange, a unit of purchasing power that works when others recognise it as having value. Currency does not have to be the coins or bills which are used by most states; it could be anything that people agree represents value. The UK
pound is underpinned by a legal, institutional and administrative framework which enables it to function as a medium of exchange, a store of value, a unit of account and a medium for deferred payment.

A.8 In the UK, as in most cases where a sovereign state has its own currency, the central bank has a monopoly right to issue money for its own area of circulation, including regulating the issuance of Scottish and Northern Irish bank notes by retail banks. The production of currency is regulated through legislation passed by the UK Parliament and monetary policy set by the Bank of England. Therefore, the currency of a state is inherently linked to the institution of the central bank and the particular monetary policy in that state – and the UK, the UK pound and the Bank of England are no different in this respect.

A.9 The sorts of assets that may be subject to negotiation in the event of a vote for Scottish independence are the cash, currency or gold reserves held by the UK state. These assets are very different from the system of currency itself; the particular currency used by a state is not an asset on the state’s balance sheet which can be divided up like the money in
a bank account. An individual pound is an asset, as is a collection of pounds in a bank account. The pound as a system of currency is not.

A.10 The Scottish Government has itself identified the UK Government’s Whole of Government Accounts as the basis of assets for which an independent Scottish State would seek to negotiate. Whole of Government Accounts does not include the UK pound."

cunexttuesonline · 10/08/2014 10:47

This has been very interesting reading, I am seeing there are disadvantages to every currency option. If we have a currency union we have to remain similar to the rUK on policies etc, but it would make trading easier? These points would benefit both countries, but gives scotland less independence. If we peg our currency to the pound then we would struggle to get credit and have nobody to help if things are in rough times, option 3 of setting up our own currency would take many years to stabilise.

So basically, voting yes is a risk. Voting no is a risk too, the way things are going in the UK with such inequality is very unsettling and I truly believe that an iScotland would work to improve that.

saintlyjimjams · 10/08/2014 11:07

I just don't understand how an independent Scotland would afford it. That's not a political comment - just a pragmatic one. The figures don't add up for me. Not that it's for me to say one way or another.

StatisticallyChallenged · 10/08/2014 11:09

My fear with an iScotland is that we might swing right - that's a personal opinion but I've actually noticed an increase in, for example, anti immigrant opinion recently and I can't help thinking that if we were independent and then faced a recession we could end up more insular and more right wing.

That is absolutely just my opinion though!

Re currency, you are absolutely right that every option has very significant disadvantages. I just hate the fact that actually, we aren't even having a discussion about what the disadvantages of the other options are because Salmond and co just won't discuss anything other than union being a certainty.

The Euro kind of shows the issues with being a small part of a bigger currency union - it hasn't exactly been smooth for those countries who've faced recessions.

cunexttuesonline · 10/08/2014 11:20

I think it's now proven that we could afford it, and our priorities could be different too.

If oil revenues are included in GDP figures, Scotland is shown to generate more per head of population than the UK as a whole. For Scotland, it is £26,424 per head compared with £22,336 per head for the UK, according to Scottish government estimates.

If you do not include oil and gas revenues then there is little difference in the figures - GDP per head in Scotland was £20,571 in 2011 and for the UK it was £20,873.

saintlyjimjams · 10/08/2014 11:25

But you'd lose a lot of current jobs??? That's the bit that doesn't add for me. As I said earlier in the thread it would benefit my area (we have lost a lot of military related contracts to Scotland over the years, I presume we would have a chance of getting them back - and they'd come back to the rUk anyway), but I would worry about the family we have in Scotland. All I can see if a mass hit on jobs as companies relocate to other parts of the UK (whether through choice or because they have to), and govt departments relocate as well.

StatisticallyChallenged · 10/08/2014 11:34

The key point there though is that we are spending more than that already - the GERS figures show that even including a geographical share of oil reserves we're running a bigger deficit than the rest of the UK.

I know there are arguments about costs which could be reduced i.e. Trident but there are also others which would increase. We haven't actually seen any definitive figures which demonstrate what it would look like after independence so the current figures are as good as we have.

Running a deficit isn't in itself a problem, but it could be a massive issue for us at least in the short run given the currency issues.

cunexttuesonline · 10/08/2014 11:35

There would be some companies that move I am sure, but I don't think it would be as cut and dry as 'right lets move everything to england'. And when it comes to govt jobs, there would be job creation too as we would need to set up more here.

saintlyjimjams · 10/08/2014 11:39

Well that's the argument on the yes side that I see repeated again and again. It seems terribly wishy washy to me. Looking at it from the comfort of knowing I'm in a region that will almost certainly benefit if firms have to move, it seems that a lot will have to, and many are likely to choose to. Seems a massive risk to me.

StatisticallyChallenged · 10/08/2014 11:52

Looking at the public sector employment figures, Scotland currently has 545000 people employed in public sector - 10% of the UK total (we have 8.4% of the population) and 21% of our total employment.

Would an iScotland need a higher proportion of our population in public sector jobs than the rest of the UK? Using those figures for qiuckness, even if we dropped to be in line with the UK average of 18%, that would be almost 78000 job losses by my reckoning.

SantanaLopez · 10/08/2014 12:24

And when it comes to govt jobs, there would be job creation too as we would need to set up more here.

And where is the money going to come from? The set up costs of a whole new state must be eye watering.

caroldecker · 10/08/2014 12:25

And all those remaining jobs would be duplicating what is currently being done for whole UK for iScotland, thus increasing the cost to the public purse.

Sallyingforth · 10/08/2014 14:41

What is certain is that all defence work will be returned to the cUK. No UK government is going to place contracts with a foreign country if the work can be done at home - EU rules permitting of course.

Either the work will go to UK firms, or the Scottish firms will move to the UK so they can keep the work. I'd be very happy with either option, but neither would be good for Scotland. I've seen it estimated that 14,000 jobs are affected - this may not be accurate depending on who calculated it, but the total must be very large and of course these are all well-paid jobs.

The financial industry jobs will also be moving south, and this will be even more important.

I really think that Scottish independence would be a very good thing for the continuing UK.

Sallyingforth · 10/08/2014 14:46

And when it comes to govt jobs, there would be job creation too as we would need to set up more here.
Setup costs for new departments would be very high. The Scottish government would have to decide whether it was best to pay them, or buy the services from the UK where we have existing organisations and economies of scale.

StatisticallyChallenged · 10/08/2014 14:50

Scale of FS - " Financial services contributed £8.8 billion to the Scottish economy in 2010 – more than eight per cent of Scottish onshore economic activity. The sector directly employs 85,000 people in Scotland and a further 100,000 indirectly – around seven per cent of total Scottish employment."

Not exactly a small number of jobs to lose - even if we only lost a proportion.

PigletJohn · 10/08/2014 15:06

If Scotland wants to be independent, then the costs of becoming independent are worth paying. I'm sure they are aware that there will be costs. Wanksock says that Scotland can afford it. Fair enough.

Toadinthehole · 10/08/2014 18:01

Whether it would actually be in iScotland's and rUK's interests to agree to a currency union is beside the point. What this is really about is how to sell the idea of independence to the undecided. Keeping the pound (and the Queen) will appeal to the cautious and conservative.

It is also about provoking a row that allows Salmond to be seen to be sticking up for Scotland. This is how it in fact played out. The White Paper said a currency union would be sought, the Yessers talked as if getting one was simply a matter of asking, as it was so very reasonable. What did the UK government do? Answer: the best thing possible from Salmond's perspective. They sent George Osborne north of the border to say why it wouldn't happen? If I were a nationalist, I would have seen this like being delivered a Christmas turkey that shat its own cranberry sauce. It allowed Salmond to make the usual claim about English bullying, in what he described as "the sermon on the pound" - an unambiguous reference to Margaret Thatcher.

It was utterly mendacious of him.

Now he is doing it again by claiming iScotland wouldn't take on any share of debts incurred by the UK while Scotland was in it. Many of these debts will, of course, have been incurred while the UK was governed by party with a disproportionately large Scottish support - and indeed a Scottish prime minister and chancellor. Once again, it is a win-win. Either the UK government will have to agree to this, or it will have to invoke the legal quid pro quo - iScotland would not be entitled to certain UK government assets - intangibles certainly, but presumably also some land assets too. Were it to make that point, the Yes camp would once again make the claim that Westminster England was bullying Scotland.

Fair minded people will not be taken in by the Yes camp's gambit. It remains to be seen what proportion of people in Scotland are fair minded.