NICOLA Sturgeon has been accused of 'actively misleading the public'
Opponents hit out yesterday after previously unseen papers revealed details of a proposed Scottish Monetary Institute (SMI) post-separation.
The financial institution, which would have employed up to 445 staff and cost almost £50million a year to run, could have been later expanded to a central bank in an independent Scotland.
Ahead of the vote, the Scottish Government published a white paper asserting that a separate Scotland would be a member of the EU and could also keep the pound by relying on the Bank of England as a central bank, with the SMI working beneath it.
However, under Brussels rules, new member states are required to adopt the euro – and newly released Government papers show this was a “hot issue” for civil servants, who highlighted the “continued use of sterling and the EU requirement for new member states to aim for convergence to adopt the euro”.
Joining the EU also requires countries to have their own independent central banks. The paper adds: “This would require negotiation and agreement with the EU. Should Scotland be required to have a separate central bank, the functions of the SMI can be expanded to fulfil the requirements.”
New member states are required to adopt the euro
The dossier, released under freedom of information laws, also suggested the EU may have opposed plans for the Bank of England to guarantee deposits and regulate banks in Scotland.
We knew the SNP’s economic plans were built on sand
Scottish Conservative finance spokesman Murdo Fraser said: “This is an astonishing revelation. At the same time as Nicola Sturgeon was confidently preaching that we could keep the pound and share the Bank of England’s functions, she knew the EU could ruin those plans.
“Their plans for a separate Scottish Monetary Institute would be extortionate, with hundreds of staff needed even if the Bank of England maintained responsibility for a ‘large’ number of functions. We already knew the SNP’s economic plans were built on sand. Now we have clear proof they were actively misleading the public.”
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The accusations come as it emerged the SNP knew the EU could thwart its plans
Civil servants drew up the draft documents, which were not approved by ministers, in the run-up to the referendum but they were kept confidential until now.
The papers state an SMI would employ up to 445 staff with yearly running costs up to £50million.
The plans largely focus on the SNP’s independence campaign proposals to keep the pound and rely on the Bank of England as a central bank but draws up a table of options for the institute, including becoming a Scottish central bank with a separate currency.
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A draft transition plan states the institute would be set up immediately after independence.
A Scottish Government spokeswoman said: “The Scottish Government was engaged in thorough, detailed and comprehensive preparations for an independent Scotland ahead of the 2014 referendum, and similar work will be taken forward ahead of the planned future referendum.
“While these plans reflect conditions in 2014, they do not necessarily reflect the Scottish Government’s current thinking.”