Scots In Dark On Post-Independence Economy
By Dow Jones Business News, April 09, 2013,
By Jason Douglas
LONDON--People in Scotland are being kept in the dark by politicians in London and Edinburgh over the economic consequences of independence, a panel of senior lawmakers said on Wednesday, ahead of a historic referendum next year on whether Scotland should end its 306-year-old union with the rest of the United Kingdom.
The economic affairs committee of the House of Lords, the U.K. parliament's upper chamber, said in a report that crucial aspects of any future economic settlement between an independent Scotland and the rest of the U.K. need to be spelt out to voters before Scots go the polls on Sept. 18, next year. Otherwise, Scottish voters cannot make an informed choice on whether to stay in the U.K. or go it alone, the committee said.
"We do not take a position on whether voters should vote yes or no on Sept. 18, 2014, but they deserve to cast their vote based on a proper understanding of the possible economic impact. At present they do not have the information to do so," said John MacGregor, leader of the economic affairs committee.
The cross-party panel called on Prime Minister David Cameron's government at Westminster in London and Scottish First Minister Alex Salmond's administration in Scotland's semi-autonomous parliament in Edinburgh to set out their stalls before the poll on issues including monetary policy, financial-sector supervision and the division of Britain's debts in the event of a U.K. break up. It complained of a "conspiracy of silence" on such issues, particularly in Scotland.
The committee said, for example, that it isn't clear what role the Bank of England would play in an independent Scotland. The panel said the Scottish government's assertion that the central bank should stand behind an independent Scotland's banks as "implausible" and dismissed proposals for the BOE to submit to oversight from Edinburgh as " fanciful."
The panel also urged Scotland's government to be clear with voters over how it intends to assume and finance its share of Britain's national debt, which would amount of 61.6% of an independent Scotland's annual gross domestic product if the debts were split according to population, according to the report. The rest of the U.K. would be left with debts equivalent to 73.5% of GDP.
The committee's report said the economic risks of independence to both Scotland and the remainder of the U.K. are clearer than any potential benefits of separation.
In the course of its inquiry, the committee said it had "become increasingly concerned that both Edinburgh and Westminster are not being open with the Scottish people or the British people as a whole" about the economic consequences of an independence vote.
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