Branches and affiliate groups including SNP trade unionists join call for an independent currency to be established in the first term of an independent Scottish Parliament
- Party branches, officials and affiliated societies back amendment in opposition to six tests for an independent currency.
- Alternative proposed to leadership motion which draws on controversial Growth Commission proposals.
- Sterlingisation at the heart of a crunch debate expected at party conference in Edinburgh at the end of April.
SNP BRANCHES, officials and affiliates are backing a party conference amendment to remove the need for a Scottish currency to pass six ‘tests’ before implementation in an independent Scotland.
The move is the most concerted effort yet within the party to push back against the SNP Growth Commission report’s currency proposals published last year, which porposed that an independent Scotland should make use of pound sterling informally, a policy widely known as ‘Sterlingisation’ which would mean foregoing monetary powers, including over interest rates and money creation.
CommonSpace understands the amendment has been submitted by at least six party branches, the SNP Trade Union Group and members of the party’s National Council, including Theo Forbes. an activist in the Aberdeen Independence Movement, and South Ayrshire councillor Laura Brennan-Whitefield.
The amendment, backed by a Campaign for an Independent Currency which is headed by economist and former SNP MP George Kerevan, removes a key clause (30) from a motion proposed by SNP Depute leader Keith Brown and Scottish Government Finance Secretary Derek Mackay for the forthcoming SNP spring conference in Edinburgh (27-28 April). Their motion is more commital to a Scottish currency than the text of the Growth Commission, but would commit party policy to the GC report’s six tests to bet met before the introduction of a Scottish currency.
The Growth Commission tests include evidence of fiscal sustainability, central bank credibility and sufficient foreign currency reserves which, critics say, are difficult or even impossible to establish without the normal powers of an independent currency.
Party branches backing the Campaign for an Independent Currency’s amendment include Stirling, Bannockburn, Greenock & Inverclyde, Clydesdale, and West Fife & Coastal Villages.
Cameron Archibald, the secretary of SNP Bannockburn branch, told CommonSpace that members in his own area and many he had met from around the country were deeply concerned about the Brown-Mackay motion.
He said: “For members in Bannockburn, we joined the SNP because we want to see an independent Scotland take a different path from the UK. And that is something different from the neoliberal economic paradigm that we are stuck in just now. What Andrew Wilson and the Growth Commission are offering is not a different progressive path. We are getting stuck within the financial framework of London finance, stuck within the vision of a Conservative UK.
“By keeping our monetary policy within the UK it means for example investors have to look at London first before looking at Scotland, it means if you have demand issues here we can’t simply use monetary tools in order to be more flexible, to use monetary policy that reflects issues in the Scottish economy.
“It scares us. It’s really worrying what is happening overall with the Growth Commission. We want change, not a slightly tweaked version of the UK.”
Brown and Mackay’s original motion, after calling for Sterlingisation for the first years of a new state, contains the following clause: “However, Conference believes that it should be the policy of an SNP government in an independent Scotland to establish an independent currency; and agrees that the process and precise timescale for doing so should be subject to robust governance and guided by the six tests recommended by the Sustainable Growth Commission.”
The amendment replaces this clause with one which omits mention of the six tests.
The amendment reads: “However, Conference believes that achieving successful higher growth and securing a sustainable fiscal balance in an independent Scotland can only be achieved through the establishment of a separate Scottish currency. Conference believes it should be the policy of an SNP government in an independent.
“Scotland to establish a separate Scottish currency within the lifetime of the first, post-independence parliament. The pound sterling will remain in use until the currency transition.”
Commenting on the conference push against the tests, Kerevan said: “It’s clear there is a strong appetite amongst SNP members for a concrete plan for an independent currency without arbitrary caveats and stipulations and that would limit Scotland’s ability to unchain itself from the chaos that is currently engulfing Westminster.
“The GC’s six tests could leave Scotland using the pound indefinitely, result in cuts to services and spending, and allow the City of London financial institutions to dictate an independent Scotland’s decisions. Sterlingisation and the six tests would effectively negate the very point of seeking independence for Scotland.
“If certainty and stability is the aim, we should follow historical examples and establish our financial independence within a reasonable time frame.
“We have to get currency right so that come the next independence referendum so activists and voters take confidence from a concrete plan that they know what they’re backing.”
The Growth Commission report, chaired by corporate lobbyist Andrew Wilson, has caused controversy in the SNP since it was launched in May 2018, with claims by the IFS and Common Weal that it advocates austerity, which Wilson has denied. The policy of Sterlingisation has been the most contentious, and all of the National Assemblies of party members to discuss party strategy over the Summer of last year heard criticisms of the proposal.