LONDON, March 26 (Reuters) - Britain’s top business lobby added its voice on Wednesday to warnings against a “yes” vote in September’s referendum on Scottish independence.
The Confederation of British Industry said the Scottish government had no credible plan for bringing down the budget deficit and lacked clarity on what currency it will use and on its future relationship with the European Union.
The British government is campaigning to keep Scotland’s 307-year union with England intact. Recent polls suggest that the vote could be tighter than previously expected.
“The economic plan outlined in the White Paper does not add up,” John Cridland, CBI director-general said, referring to a 649-page document on Scotland’s future published last November.
“Independence would force Scotland’s major industries to grapple with two lots of red tape and lead to Scots facing higher borrowing costs on loans, mortgages and credit cards.”
Costs for businesses could rise as complex tax rules for cross-border trade are drawn up and as retailers pass distribution costs, which currently are spread across Britain, fully onto Scottish consumers, the CBI said.
A new, small Scottish government debt market is also likely to trade at higher interest rates than British gilts, serving as a basis for higher mortgage repayments, loans and credit card bills for ordinary Scots, it said.
An independent Scotland’s public finances would also be likely to worsen further relative to Britain‘s, the CBI said, given its dependence on declining oil and gas reserves and an ageing population.
Scotland’s budget deficit was 8.3 percent of gross domestic product in the 2012-2013 fiscal year, bigger than Britain’s 7.3 percent. That was the first time Scotland’s public finances were weaker than those of Britain as a whole in five years.
A spokesperson for Scottish leader Alex Salmond called the report “one-sided” and said it ignores benefits from policies Scotland plans to pursue under independence. (Editing by Ruth Pitchford)