POLITICS

Salmond's Scottish Independence Plans Could Harm Businesses, Warn MPs

08/08/2014 09:49 BST | Updated 08/08/2014 10:59 BST
Jeff J Mitchell via Getty Images
GLASGOW, SCOTLAND - AUGUST 05: Alex Salmond (pictured) First Minister of Scotland and Alistair Darling chairman of Better Together take part in a live television debate from the Royal Conservatoire of Scotland on August 5, 2014 in Glasgow, Scotland. The two politicians are facing questions in front of 350 people during a live televised debate, they will try and influence voters before the referendum on 18th September when the nation will be asked to vote yes or no to decide whether Scotland should be an independent country. (Photo by Jeff J Mitchell/Getty Images)

Scottish businesses could be left facing an uncertain future in Europe in the event of independence, MPs have warned.

Independence would create an uncertain investment environment and have a damaging impact on businesses in the country, the Commons Business Innovation and Skills Committee said.

The report looked at issues including which currency an independent Scotland would have, claiming the country could be left "in limbo" if it could not have either the Euro or sterling.

Other areas of concern, the Committee said, are higher education which could face a funding shortfall if plans to charge UK students fees to attend Scottish universities are found to be illegal under EU law.

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Committee chairman Adrian Bailey said the Scottish government had failed to argue successfully that Scotland would be better off economically as a separate state.

"On big questions, such as the issue of a future currency, it's time for the Scottish Government to come clean and lay out the detail," said the MP.

"It's no longer tenable for the Scottish Government to assert an independent Scotland will retain the pound when a sterling currency union is firmly off-the-table.

"The Scottish Government must play fair with Scottish businesses, investors, and voters and set out its plans for an alternative currency for an independent Scotland."

He said the committee had concluded that, economically, it is best for Scotland to remain as part of the UK.

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This comes after a new report by the National Institute for Economic and Social Research found that banks could not be sure they would be bailed out in the event of another financial crisis unless a formal currency union was created to share the pound.

Dollarisation - also referred to as sterlingisation - would have consequences for Scotland's financial sector, its capacity to export financial services, its new balance of payments and its economic prosperity, said the NIESR report, which was seized upon by Treasury chief secretary Danny Alexander as proof that independence would be "disastrous" for Scotland's banking sector.