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The Bank of England has challenged the Scottish government’s characterisation of official contacts between them, in an embarrassing setback for nationalist ministers before next month’s independence referendum.
Edinburgh has been keen to play up Scottish government meetings with central bank staff. John Swinney, Scotland’s finance secretary, said on Wednesday officials had “technical discussions . . . regarding our proposal for a currency union”.
However, the central bank on Thursday directly contested Mr Swinney’s remarks, saying: “To be clear . . . the Bank of England has not entered into discussions with representatives of the Scottish government about proposals for future monetary arrangements in Scotland.”
The unusual intervention by the bank, which has limited itself to answering technical questions from Scottish officials, reflects its anxiety not to be seen to be taking sides in the referendum debate.
It follows a similar incident in 2012 when the BoE challenged Mr Swinney’s description of meetings as a “very helpful dialogue”.
Opponents of independence have tried to portray the central bank as hostile to the Edinburgh’s plans for a formal post-independence currency union with the remaining UK.
Yes campaigners, by contrast have, seized on comments by Mark Carney, the central bank governor, on currency unions as a signal that the Scottish plan is workable.
Mr Carney stressed, at a press conference on Wednesday, that it would be up to elected politicians to decide the central bank’s remit, saying: “We don’t get a vote in this and we don’t want a vote in this”.
No campaign strategists see the Scottish government’s currency plans as a key weakness.
In the Scottish parliament on Thursday, opposition party leaders repeatedly accused Mr Salmond of creating uncertainty by refusing to identify a post-independence Plan B to its favoured policy of retaining a formal currency union with the remaining UK.
At a media briefing for the cross-party pro-union Better Together campaign, Ronald MacDonald, Glasgow university’s Adam Smith professor of political economy, said Mr Salmond’s Plan A would prove disastrous.
If an independent Scotland remained in a full currency union with the UK, its non-oil economy would quickly suffer steep declines in competitiveness, Professor MacDonald said.
“I don’t think [a currency union] would last long,” he said.
The Scottish government said: “We have always made clear that these are technical discussions and not negotiations and that we respect the neutrality and independence of the bank, which had made clear it will implement whatever is agreed.”
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