The three political party leaders will be heading to Scotland today to try and secure a vote against independence, as uncertainty over the outcome of next week’s referendum sees fund groups pull money out of the country and amid warnings on the impact on mortgages.
The leaders of the three parties will be north of the border today selling their vision for a Scotland that has more powers to set its own taxes as financial services firms warn of serious consequences of a vote for independence.
Prime Minister David Cameron, deputy prime minister Nick Clegg and Labour leader Ed Miliband have said they are willing to devolve more financial power to Scotland if it votes no in the referendum later this month. A package put together and set to be voted on after the general election in the event of a no vote would give Scotland more power to set income tax and capital gains tax, though not corporation tax.
Writing in the Daily Mail, Cameron has called on the Scottish people not to “rip apart” the 307 year old union with the UK.
He says: “Our message to the Scottish people will be simple: ‘We want you to stay.’
“The United Kingdom is a precious and special country. That is what is at stake. So let no one in Scotland be in any doubt: we desperately want you to stay; we do not want this family of nations to be ripped apart. Across England, Northern Ireland and Wales, our fear over what we stand to lose is matched only by our passion for what can be achieved if we stay together.”
But Scotland’s first minister Alex Salmond said: “This is the day the No campaign finally disintegrated and fell apart at the seams. Together, David Cameron, Ed Miliband and Nick Clegg are the most distrusted Westminster politicians ever – and their collective presence in Scotland will be another massive boost for the Yes campaign.”
Barclays, Deutsche Bank, Societe Generale, JP Morgan, RBC Capital Markets and Credit Suisse have all said that a yes vote could have dire consequences for the economy putting the recovery at risk.
The Financial Times reports that asset managers, investors and pension savers are moving billions of pounds out of Scotland over fears of the economic consequences of independence. Multrees Investor Services, which manages bank accounts for the wealth management industry, said it had moved hundreds of milions of pounds of behalf of wealth managers following concerns over the referendum.
There have also been warnings about the impact on mortgage holders if Scotland votes Yes.
London and Country associate director of communications David Hollingworth told the Daily Telegraph introducing a new currency is likely to pose difficulties for those with mortgages.
He says: “Terms and conditions of a mortgage loan would be likely to remain the same but, if the loan payments are taken in sterling, then suddenly the borrower has a major conversion issue if they’re suddenly being paid in a new Scottish currency. They would not only be subject to interest loan fluctuations but also exchange rate volatility.”
Yesterday, in a speech to the Trades Union Congress Bank of England governor Mark Carney said a currency union with the UK in the event of a yes vote would be “incompatible with sovereignty” and would require a single central bank and shared banking regulation.