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No union, no pound - London's warning to Scotland

Thursday, February 13, 2014 - 02:01

Feb.13 - Whitehall escalates its bid to scuttle Scotland's separatist ambitions as finance minister George Osborne adds his voice to warnings it will lose the pound if it votes for independence. Ciara Sutton reports.

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(SOUNDBITE) BRITISH CHANCELLOR GEORGE OSBORNE, SAYING: "Nowhere are the risks to Scotland's economic security more apparent, than in the debate about currency." Britain's most aggressive attempt to knock Scottish nationalists bid to break the 307-year-old union with England. UK Chancellor George Osborne sought to play on Scottish fears of losing the pound saying it would thrust Scotland into volatility. (SOUNDBITE) BRITISH CHANCELLOR GEORGE OSBORNE, SAYING: "The evidence shows it wouldn't work, it would cost jobs and cost money. It wouldn't provide economic security for Scotland or the rest of the United Kingdom." Scotland votes in a referendum on independence in September. By honing in on Scottish hopes of keeping the pound, London's politicians hope to undermine the economic case for independence Osborne's speech echoes Cameron's efforts last week to make the patriotic case for unity, and other UK party leaders are also backing the campaign. Though the leaders of Scotland's bid to breakaway say it's just panicked bullying. And today's message was much harsher: If you leave the UK, you will lose the pound and pay higher interest rates. Phil Tyson from ICAP. (SOUNDBITE) (English) PHIL TYSON, HEAD OF STRATEGY FOR INTEREST RATE PRODUCTS AT ICAP, SAYING: "You've got this situation where Scotland wants to pull away and become more independent, but at the same time retain the currency. And that's going to expose them to all the risks potentially that we've seen in Europe. So I think that's going to be a big factor in the decision-making process for the public when the vote comes round in September." Scottish nationalists say if London prevented a currency union, an independent Scotland could refuse to take on its share of the UK's 1.2 trillion pounds of government debt. They want the Bank of England to remain the lender of last resort for financial institutions after possible independence. But the bank's chief, Mark Carney, has cautioned that any currency union would entail a surrender of some sovereignty.

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No union, no pound - London's warning to Scotland

Thursday, February 13, 2014 - 02:01