Nicola Sturgeon 'walking nationalist tightrope' says expert
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Scotland’s First Minister Ms Sturgeon has renewed her promise to introduce a second independence referendum after a majority of pro-independence MSPs were elected to Holyrood last month. Despite Downing Street’s resistance, she has vowed to let the Scots back into the ballot box once the urgency of the pandemic has subsided. However, many still have concerns about what the reality of an independent Scotland could look like in the event that it were to split from the rest of the UK. The Royal Bank of Scotland (RBS) has been based in Edinburgh for close to 300 years.
While Alison Rose, the chief executive of its parent company NatWest Group, promised that the bank is “neutral” on the Scottish independence debate, she has warned that it could have serious consequences for the bank’s central headquarters.
Speaking to the Scottish newspaper The Herald, Ms Rose said: “As you know, we are neutral on the issue of Scottish independence — it is something for the Scottish people to decide.”
She added that the bank has been “very clear” that if Scotland went independent, “our balance sheet would be too big” and so the bank’s headquarters would move to London.
Ms Rose added that this fact was “recognised by senior nationalists” as well, and promised that the bank would remain dedicated to Scotland as it is one of the country’s largest private-sector employers.
However, the First Minister said she “refuses to accept” RBS’ justification for potentially relocating in response to Ms Rose’s words.
Ms Sturgeon told BBC Radio 4: “I don’t necessarily accept all of that case, but I do accept that we have to engage constructively with businesses of all shapes and sizes.
“But Scotland, like countries of comparable size, is perfectly capable of being independent.
“We have a strong and vibrant business base in Scotland.
“But I do accept that we have to have those discussions.”
She continued: “We had this debate in the final stages of the referendum campaign in 2014, and banks at the time talked about registered offices, not operation, not jobs.
“But at the heart of this debate is, for those who are against independence, this ridiculous notion that somehow, uniquely, among countries across the world, Scotland is incapable of being independent.
“I don’t accept that. Scotland would be a thriving, successful, independent country.”
Ms Sturgeon also addressed other economic concerns which have overshadowed the independence debate.
She said that in the event of independence, the SNP intends to use sterling at first before moving to the country’s own currency and establishing a central bank.
But, the SNP’s “sterlingisation” plan to use the pound without formal monetary union before moving to a new currency is said to be flawed, and has been criticised by experts fearing it could trigger an economic crisis.
Writing in The Spectator, John Ferry noted that Scotland would have to establish trust and credibility with its new currency before it could become a success.
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He explained: “Extreme fiscal prudence would be required.
“With Scotland running a preo-coronavirus implicit budget deficit of 8.6 percent of GDP (Scotland’s current deficit is estimated at over 25 percent of GDP), that would mean a ruthless austerity programme.”
During her interview with BBC Radio 4, Ms Sturgeon did acknowledge that border problems with England are likely to become a serious issue if an independent Scotland were to return to the EU.
But, she promised that the Scottish government would negotiate terms to “allow businesses to keep trading” across the border.
She also said an independent Scotland in the EU would be more beneficial to businesses, as it “makes Scotland more attractive again in terms of inward investment to secure that access to the single market”.
But, Scottish Conservative finance spokesman Murdo Fraser said that RBS’ threat to move could be indicative of how many Scottish businesses will act in the event of independence.
He said RBS’ action “starkly confirms the very real consequences for Scottish jobs and business if Nicola Sturgeon ever gets her way”, adding that it would be “devastating”.
Liberal Democrat MP Christine Jardine also criticised the SNP’s pursuit of independence, claiming she was “appalled” that they wanted to bring such “chaos” after Brexit and the Covid pandemic had already caused significant disruption.
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