Browse content similar to 23/04/2013. Check below for episodes and series from the same categories and more!
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more prosperous and fairer country. Tonight on Newsnight Scotland will | :00:11. | :00:15. | |
have more on the debate over the currency including an interview with | :00:15. | :00:20. | |
George Osborne. Good evening, the Chancellor's chose St George's Day | :00:20. | :00:26. | |
to talk about sterling. His message was that the SNP's plan for Scotland | :00:26. | :00:31. | |
to continue to use the pound after independence is deeply flawed. The | :00:31. | :00:34. | |
Scottish Government were swift in their rebuttal as Andrew Black | :00:34. | :00:39. | |
reports. Spoke in England today celebrated | :00:39. | :00:45. | |
the life of St George, their patron saint, his namesake headed north in | :00:45. | :00:50. | |
the hope of slaying a nationalist Dragon. Welcome, ladies and | :00:50. | :00:56. | |
gentlemen. Thank you for coming... Dismissing SNP proposals to retain | :00:56. | :00:59. | |
the pound is an independent Scotland, George Osborne said things | :00:59. | :01:04. | |
worked fine as they are. The saying goes that if it isn't broke, don't | :01:04. | :01:09. | |
fix it but I say, if it isn't broke, don't break it. The | :01:09. | :01:13. | |
alternative is to the way Scotland is now uses the pound are second | :01:13. | :01:19. | |
best. Second best, is that really best for Scotland? As the Chancellor | :01:19. | :01:23. | |
came to Glasgow today, the Treasury published this document outlining | :01:23. | :01:27. | |
various options for the future of an independent Scotland. Everything | :01:27. | :01:31. | |
from a standalone currency to the SNP's preference of a sterling zone. | :01:31. | :01:37. | |
But all of these, say Mister Osborne, would leave Scotland and | :01:37. | :01:41. | |
the rest of the UK worse. The first Minister was also out and about and | :01:41. | :01:50. | |
talking up Scotland's future, this time in sciences. Alex Salmond today | :01:50. | :01:53. | |
endorsed the findings of the fiscal group set up by his own government. | :01:53. | :01:59. | |
It just happens to support monetary union. They think that would be the | :01:59. | :02:05. | |
best option for Scotland and for the rest of the UK so our approach has | :02:05. | :02:08. | |
been upfront and constructive, laying out what is best for the | :02:08. | :02:14. | |
people of Scotland and the people in the rest of the UK. Others in the | :02:14. | :02:18. | |
independence movement encouraged the SNP to keep an open mind. In the | :02:18. | :02:21. | |
long run, we should be looking to develop a separate currency. You | :02:21. | :02:26. | |
cannot do that overnight, take a slower, colour separation of | :02:26. | :02:30. | |
currency and that would make sense to me and give us the full powers to | :02:30. | :02:34. | |
make all of our decisions for ourselves. Despite big political | :02:34. | :02:39. | |
posturing, it is argued that if it does come to the crash, the UK | :02:39. | :02:42. | |
Government would come to some kind of agreement. This that the Scottish | :02:42. | :02:47. | |
Government is keen on keeping some sort of sterling connection means | :02:48. | :02:54. | |
that it is likely that that will go forward. I can't see the UK | :02:54. | :02:58. | |
Government being so obstructed as to put conditions in place that are | :02:58. | :03:03. | |
unacceptable so at the minute, that looks like it would be favoured. | :03:03. | :03:06. | |
Hopes are high that the independence debate is now turning the corner, | :03:06. | :03:16. | |
:03:16. | :03:16. | ||
from trading in adult -- trading insults to discussion. Thanks for | :03:16. | :03:21. | |
coming along. As for the Chancellor, he is off back to Whitehall to plan | :03:21. | :03:25. | |
for his next move in the fight to keep the union. | :03:25. | :03:31. | |
This morning, I spoke with George Osborne and that was at a factory in | :03:31. | :03:35. | |
Castlemilk. I asked him if a sterling zone could suffer a crisis | :03:35. | :03:40. | |
like the one in the Eurozone. saying the arrangements at the | :03:40. | :03:45. | |
moment when Scotland is part of the UK and uses the pound like all other | :03:45. | :03:49. | |
parts of the UK, are the best arrangements for Scotland and for | :03:49. | :03:52. | |
the UK. And anybody who wants to change that relationship, anybody | :03:52. | :03:58. | |
who wants a separate Scotland needs to explain what they would do. And | :03:58. | :04:02. | |
the other options, like Scotland having its own currency board | :04:02. | :04:08. | |
joining the euro, or having a similar zone like the rest of the | :04:08. | :04:18. | |
:04:18. | :04:18. | ||
UK. Full. Do you worry that there is a Eurozone style crisis? It would | :04:18. | :04:23. | |
beg also some questions about economic risks, about why a foreign | :04:23. | :04:27. | |
government which is what the rest of the UK would have become would want | :04:27. | :04:31. | |
to enter into this arrangement, why it would want to tie itself to the | :04:31. | :04:37. | |
economic policies of the Scottish Government so frankly I think it is | :04:37. | :04:42. | |
unlikely that the arrangement could be agreed with the rest of the UK or | :04:42. | :04:47. | |
indeed would work. If this is a profound analysis rather than | :04:47. | :04:52. | |
posturing, why don't you just say right now, as you would be the man | :04:52. | :04:55. | |
in charge of the negotiations on this should it come to pass, why | :04:56. | :05:05. | |
don't you say no? I am saying it is unlikely. Why not say no?I will not | :05:05. | :05:12. | |
negotiate before the measure because my argument is that we should keep | :05:12. | :05:17. | |
it together. It is the SNP who must answer questions. You could say this | :05:17. | :05:22. | |
is bad for the rest of the United Kingdom and we will not enter | :05:22. | :05:26. | |
negotiations. I think the best arrangement for both is to have what | :05:26. | :05:29. | |
we have at the moment and it is for those who want to break up that | :05:29. | :05:33. | |
arrangement to explain what they would put in its place and you have | :05:33. | :05:40. | |
heard from the SNP. Let's say Scotland becomes independent, you | :05:40. | :05:43. | |
represent the whole of the United Kingdom now, if you believe it is | :05:43. | :05:47. | |
such a bad idea to have a formal currency arrangement with an | :05:47. | :05:51. | |
independent Scotland, surely it is your responsibility to say to people | :05:51. | :05:56. | |
that you say as Chancellor that he will not negotiate this because we | :05:56. | :06:02. | |
could run the risk of a Eurozone crisis. I think the current | :06:02. | :06:06. | |
arrangements are the best. The Eurozone style currency zone which | :06:06. | :06:10. | |
you are asking me about, Scotland having its own currency, Scotland | :06:10. | :06:17. | |
using the pound as John Swinney suggesting without any consent, like | :06:17. | :06:27. | |
Panama uses the American dollar, those are second best options. | :06:27. | :06:30. | |
have pointed out somewhere in your document that the stability pact in | :06:30. | :06:35. | |
the Eurozone did not amount to a row of beans in the crisis. You said | :06:35. | :06:39. | |
this morning that in a currency zone they would have to be more | :06:39. | :06:42. | |
controlled by the UK over Scotland's budget than at the | :06:42. | :06:47. | |
moment. What do you mean? We're not just talking about borrowing or | :06:47. | :06:51. | |
pact, pact, what would you want to be able | :06:51. | :06:55. | |
to control? This is one of the questions about I currency zone | :06:55. | :06:58. | |
which is how much control do you give to a foreign government about | :06:58. | :07:06. | |
your tax, borrowing decisions? In the Eurozone, they have to submit | :07:06. | :07:10. | |
budgets to national parliaments and Brussels. So one question would be, | :07:10. | :07:19. | |
but the Scottish Government have to submit its budget to Westminster | :07:19. | :07:29. | |
:07:29. | :07:32. | ||
before it is fitted to Holyrood for approval? That would include tax | :07:32. | :07:36. | |
policy? All decisions that affect the economic sustainability of ink | :07:36. | :07:45. | |
-- country. Tax is one component of borrowing. But John Swinney was | :07:45. | :07:51. | |
saying again this morning that they would hope that Scotland had full | :07:52. | :07:55. | |
fiscal freedom. That is not how currency zones operate and why the | :07:55. | :07:59. | |
way, what about the question that John Swinney does not address which | :07:59. | :08:03. | |
is who is to say that the rest of the United Kingdom, Northern Ireland | :08:03. | :08:07. | |
and Wales, would accept any kind of decision or control from an | :08:07. | :08:16. | |
independent Scotland over its budget policies? John Swinney says that | :08:16. | :08:20. | |
George Osborne is playing politics, if you want allows Scotland to use | :08:20. | :08:23. | |
the pound, then an independent Scotland will not take on a share of | :08:23. | :08:28. | |
the British national debt. What is your response to that? John Swinney | :08:28. | :08:32. | |
must answer basic questions about what currency Scotland would use if | :08:32. | :08:37. | |
they became independent. I will not renegotiate the terms of | :08:37. | :08:42. | |
independence because I wanted to remain in the UK and the best way | :08:42. | :08:46. | |
for Scotland to keep the pound is for Scotland to stay in the United | :08:46. | :08:56. | |
:08:56. | :08:58. | ||
do not know how clearly you could hear that interview with George | :08:58. | :09:03. | |
Osborne, he is quite specifically making the point that the stability | :09:03. | :09:08. | |
pact where you have limits on stock of debt and borrowing did not work | :09:08. | :09:12. | |
in the Eurozone crisis and if he was to consider a currency union with an | :09:12. | :09:15. | |
independent Scotland, it would have to involve much more than that. He | :09:15. | :09:22. | |
says it must include tax and spending. Is that something you | :09:22. | :09:28. | |
would be prepared to contemplate? do not think it would be necessary | :09:28. | :09:32. | |
in that level of detail. An agreement about the strategic | :09:32. | :09:37. | |
financial framework would be. argument is that it didn't work in | :09:37. | :09:41. | |
the Eurozone and he is not prepared to repeat it in a British Eurozone, | :09:41. | :09:50. | |
if you like. It is about how clearly you secure that. Those requirements | :09:50. | :09:55. | |
were not securely founded on the member states involved in the | :09:55. | :09:59. | |
Eurozone. What is important is an approach to financial responsibility | :09:59. | :10:03. | |
which would be implicit in this arrangement and they would have to | :10:03. | :10:07. | |
be a very clear and rounding and well founded agreements around the | :10:07. | :10:13. | |
levels of debt that we could incur and the level of rowing we could | :10:13. | :10:18. | |
undertake. For example, let me give you a very basic example. One of the | :10:18. | :10:21. | |
points the Treasury makes in its document is that they would have to | :10:22. | :10:24. | |
be a commitment to a currency union say you couldn't have Scotland | :10:25. | :10:29. | |
flirting with the idea of joining the euro or setting up its own | :10:29. | :10:33. | |
currency if the rest of the UK was to agree to a currency union. Would | :10:33. | :10:36. | |
you be prepared to give a binding commitment that Scotland would not | :10:36. | :10:42. | |
apply to join the euro unless it was either agreed with the United | :10:42. | :10:49. | |
Kingdom order that the same time? -- or done at the same time. What | :10:49. | :10:53. | |
George Osborne has been saying is about his interpretation on the | :10:54. | :10:56. | |
currency question. I could not have been clear in all of the interviews | :10:56. | :11:01. | |
I have given for some considerable time that the Government's position | :11:01. | :11:06. | |
in Scotland is that we want to establish a sterling zone and we | :11:06. | :11:11. | |
reduced the currency of the pound. And that is our clear undisputed | :11:11. | :11:15. | |
option. You would be prepared to give the option I have suggested to | :11:15. | :11:25. | |
:11:25. | :11:28. | ||
commitment because that is the commitment of the Scottish | :11:28. | :11:33. | |
Government. You seem to be suggesting today that if the British | :11:33. | :11:37. | |
government did not do what you wanted in a currency union of | :11:37. | :11:45. | |
Scotland votes for independence, you might not accept a share of the UK | :11:45. | :11:49. | |
national debt. Where you being serious or was it a joke? I was | :11:49. | :11:53. | |
pointing out the illogicality of George Osborne 's position. As | :11:53. | :11:56. | |
regards the pound and the Bank of England, he is saying that he | :11:56. | :12:00. | |
decides what happens and is the one who will determine what will happen | :12:00. | :12:04. | |
in that Scotland has no say at all. That cannot possibly be the case | :12:04. | :12:12. | |
because that would mean George Osborne determines the position | :12:12. | :12:16. | |
which has as much at stake for Scotland as the rest of the UK. I am | :12:16. | :12:20. | |
simply making the point that if George Osborne was taking control of | :12:20. | :12:24. | |
all of the assets then he must take control of all the liabilities and | :12:24. | :12:28. | |
debts also. There is an asymmetry here and that | :12:28. | :12:33. | |
is the problem. It is all very well to say your proposals for a currency | :12:33. | :12:38. | |
union makes sense and that you have economists with Nobel Prize is | :12:38. | :12:42. | |
backing you up. The point is, the British government will decide | :12:42. | :12:46. | |
whether this happens or not and they are seeing that they do not see any | :12:47. | :12:52. | |
way of making it work. Irrespective of how convincing your arguments, | :12:52. | :12:58. | |
ultimately, it does not matter, they will decide. It was interesting in | :12:58. | :13:00. | |
your interview with George Osborne and you give him every opportunity | :13:00. | :13:05. | |
to say no and he did not take it. That says to me that today has been | :13:05. | :13:09. | |
an escapade and posturing to try to make it all sounds too difficult, | :13:09. | :13:17. | |
too hard and with too many barriers to overcome. In reality, the | :13:17. | :13:22. | |
proposition that we have put forward and followed by the fiscal | :13:22. | :13:25. | |
commission which has distinguished people taking part in it, it makes | :13:26. | :13:29. | |
sense in the interests of Scotland and the rest of the United Kingdom | :13:29. | :13:32. | |
because of the trade that goes between our respective due | :13:32. | :13:38. | |
restrictions and because of the balance of payments. | :13:38. | :13:41. | |
If George Osborne and Danny Alexander stick to their current | :13:41. | :13:45. | |
idea that they do not think this will work and they will not agree to | :13:45. | :13:52. | |
it, what is your plan B? They have not said that. They said it cannot | :13:52. | :13:59. | |
work. You cannot possibly enter into a negotiation if you do not have a | :13:59. | :14:06. | |
plan B. That would be irresponsible to the people of Scotland. We should | :14:06. | :14:09. | |
argue as to what they think is the most appropriate arrangement for the | :14:09. | :14:14. | |
people of Scotland. And to put that in front of the Scottish population. | :14:14. | :14:19. | |
What if you do not get that? I will not second-guess and speculate about | :14:19. | :14:24. | |
these other options. We have a proposition that we have taken care | :14:24. | :14:30. | |
to develop and canvassed external opinion. We did that several weeks | :14:30. | :14:32. | |
ago and gone into all of the detail, more detail than the | :14:32. | :14:38. | |
Treasury have done. We have produced a strong and workable proposition. | :14:38. | :14:44. | |
You must have a plan B. You are in effect asking the people of Scotland | :14:44. | :14:46. | |
to vote for a proposition that depends on the agreement of the | :14:46. | :14:52. | |
British government when the British government is saying it is minded | :14:52. | :14:55. | |
not to agree to it. You cannot expect people to vote for | :14:55. | :15:00. | |
independence on that basis. The UK and did -- the UK government has not | :15:01. | :15:10. | |
said that. In their document they say it could be established by | :15:10. | :15:13. | |
agreement between the two governments. If the UK government is | :15:13. | :15:17. | |
to remain faithful to the Edinburgh Agreement that was signed in October | :15:17. | :15:20. | |
between the Prime Minister and the first Minister, both governments | :15:20. | :15:25. | |
agreed to work in a constructive spirit... You cannot seriously claim | :15:25. | :15:34. | |
that the British... No, I said the Edinburgh Agreement committed the | :15:34. | :15:38. | |
United Kingdom government to engage constructively with the Scottish | :15:38. | :15:44. | |
government to implement the terms of a yes result in a referendum in | :15:44. | :15:47. | |
September. If the UK government is going to remain true to that | :15:47. | :15:52. | |
commitment, we are entitled to say that this is our preferred option | :15:52. | :15:54. | |
and instead of posturing, they should deal seriously with this | :15:54. | :16:01. | |
matter. Is not the problem you have, and some people going for | :16:01. | :16:06. | |
independence would take this point of view also, is that you are so | :16:06. | :16:14. | |
desperate for this currency union, it is so important to do, that why | :16:14. | :16:20. | |
should you bother leaving the UK in the first place? That's back if it | :16:20. | :16:27. | |
is so important to you, why do you want to do this? If people do that | :16:27. | :16:30. | |
they would not have access to the full range of fiscal powers that I | :16:30. | :16:37. | |
believe are essential... That is where I think the Chancellor is | :16:37. | :16:41. | |
completely wrong. We must gain access to the economic and fiscal | :16:41. | :16:46. | |
levers that are much more comprehensive and go across the | :16:46. | :16:50. | |
whole selection of different areas in relation to the management of the | :16:50. | :16:52. | |
economy and to strengthen the Scottish economy. Thank you, John | :16:52. | :16:58. |