What a load of b*****s

Calton would like to thank all his readers for contributing to this blog reaching over 10,000 pageviews since it started. He is back in cold but sunny Edinburgh, just in time to avoid singeing his wings in Lochaber. Who would have thought that Fort William could be so dry? Anyway, it's back to the same old same old here in the capital, with John Swinney still singing the praises of a currency union with England in the event of a 'yes' vote next year. He continues to think that an independent Scottish government would have the full fiscal and economic freedom to vary tax and spending to deliver economic growth and to serve the best interests of the Scottish economy in such a union. Bankers to that - Ron MacLeod and Hamish Patrick to be precise.

Settling for Plan B

Calton is indebted to the First Minister for explaining the difference between fiscal policy and monetary policy at FMQs today, however he is not sure if Alex answered Johann Lamont's question, namely, does the First Minister have a Plan B if the Bank of England doesn't give us good terms on Sterling? Calton is also not so sure that you can separate fiscal and monetary policy quite so easily as the First Minister seemed to be suggesting. Granted, the Bank of England is nominally independent of Westminster, however the inflation target which it is trying to meet is set by Westminster and, should one be in any doubt about the link between the Chancellor and the BofE, the former gave the latter a new remit yesterday in the Budget. Would the Chancellor of an independent Scotland be able to do the same? What if the two Chancellors do not agree on monetary policy? Under the SNP's plans, Scotland would be able to set taxes and spending levels but would not be in control of interest rates, inflation or the money supply. Perhaps Johann is putting her question the wrong way round - why are the SNP settling for Plan B for an independent Scotland when we could have a Plan A?

Calton said it first

Calton has been saying for quite some time now that, if an independent Scotland is to truly have control over its economic policy, it needs to have its own currency. Now, leading economist Professor John Kay has said much the same thing. He thinks that it would be right to try and retain the pound but the cost might be restrictions on our fiscal freedom. John Swinney has welcomed the Professor's contribution to the debate which leads Calton to wonder if he actually listened to/read it. So, for the benefit of Signalman Swinney, here it is in plain language - we won't be the ones pulling the fiscal levers if we keep the pound. It would therefore seem wise to have an alternative option if Sterling proves too tricky. It's called the Groat. (Anyone who expected Calton to say the Euro has (a) not been reading this blog and (b) deserves their eyes pecked out.)

Pot calling kettle black

It's a bit rich of John Swinney to say that it's time the Chancellor George Osborne listened, given the SNP's own poor track record of listening to the electorate. If Swinney and his pals have their way, Scotland will be an independent basket case with a large deficit and a downgraded rating, paying high interest on her debts to fund the SNP's vote-winning handouts, until the EU wades in and tells them to cut spending. As a party, the SNP have realised that Scotland will have to be a member of NATO if she wants to be taken seriously past-independence. Unfortunately, the same maturity is not evident in their approach to government finances. Time to grow up, boys and girls.

Staying in the EU is nonsense

It just does not make sense for the SNP to keep complaining that, as part of the UK, they do not have all the fiscal levers needed to help the economy, while all the while they are determined to stay/become part of the EU if Scotland becomes independent, especially in the light of Frau Merkel's most recent comments in which she stated that the EU should have "real rights to intervene in national budgets". Which of those seven rather frightening words does Alex Salmond not understand? Is it only unacceptable to the SNP when England intervenes in Scottish affairs but it's OK if Europe does it? Who would you rather have sticking an oar into our budget - England or Germany? Calton would rather have the former any day of the week. If our First Minister truly wants independence he needs to go for our own bank and our own currency and stay out of the EU. Anything else is just nonsense.

The benefits of a minority government

Johann Lamont is quite right to point out that in order to maintain popular but expensive SNP pledges, such as the council-tax freeze, no tuition fees and free personal care for the elderly, taxes will have to rise or other services will be cut. Calton said much the same thing a few days ago, however, as long as the SNP have a majority in the Scottish Parliament, both Calton and Johann are whistling in the wind. The SNP can do what they like. All that the Scottish Labour leader can do is carry out her policy review, set out her plans for how she would balance the budget and hope that the SNP's autocratic attitude gets up enough people's noses to wipe out their majority at the next election.

Keeping speech and prescriptions free

Calton is not sure that it would be a good idea to remove the 'no overnight parking' signs from Highland laybys. Given the increase in 'wild' camping and caravanning in these times of austerity, this would seem like a green light to low-budget holidaymakers to foul our laybys, with Highland Council picking up the tab. Highland council tax payers may wish to make their feelings about this known to their elected representatives.

Abuse of any sort is foul, however Calton is glad to see that the DPP in England and Wales considers that the bar should be set pretty high before prosecuting, in order to defend freedom of speech. Hopefully the same common-sense approach will prevail in Scotland.

Finally, in today's smorgasbord of  unrelated comments, Calton welcomes the commitment made in today's SNP budget to free prescriptions and affordable housing. He just wishes that John Swinney would stop bemoaning the fact that he doesn't have all the fiscal levers he would like - Swinney has obviously missed his true vocation as an old-fashioned railway signalman. If he loses his job as Finance Minister he could always try pulling pints at his local.

As clear as mud

A spokesman for the SNP is reported as saying that there is a "fundamental distinction" between monetary policy and fiscal policy. Is Calton the only one struggling to work out what that distinction is? Given that the spokesman doesn't seem to have enlarged upon his comment, do the SNP know what the distinction is? Or is this just more ill-informed, seat-of-the-pants waffle designed to thoroughly bamboozle the Scottish electorate? It certainly isn't engendering confidence up in Calton's eyrie that the SNP actually know what they are talking about when it comes to monetary/fiscal policy. A Treasury spokesman has said that the Scottish government's proposals remain "totally unclear". You can't get much clearer than that as a vote of no confidence. And the SNP want us to trust them with the economy of an independent Scotland? Calton would rather have mud in his eye.

A licence to spend?

Is Calton the only one who is worried that the Scottish Government can now borrow up to £5bn given that the two largest parties in Holyrood at the moment believe in spending our way out of the recession? Thankfully the Scotland Bill passed in the Scottish Parliament today will not come into effect until after both the independence referendum and the next Scottish election, giving voters the chance to decide if we wish to return to the reckless borrowing of the Brown Labour years or adopt a more austere approach. No prizes for guessing which Calton would choose. Not that he wants to see Scotland adopting English Tory policies wholesale - Scotland is currently leading the way on free prescriptions and free tuition, to give just two examples, and should continue to do so. We just need to realise that the supply of money to pay for these things is no more limitless than the oil in the North Sea. Some good old-fashioned Scottish thrift would not go amiss now that we have more control over our own money.

Limited room for manoeuvre

So, Alex Salmond has finally admitted that if an independent Scotland wants to use Sterling, it will have to have a fiscal stability pact with, er, the rest of the UK. That will be the countries which Scotland has just thumbed its nose at and divorced itself from. Does he really think that we are going to get good terms in those circumstances? Especially when you consider that the remainder of the UK will still be 10 times larger than us. We will very much be the junior partner and the only thing worse, as far as Calton can see, is joining the Euro. He notices that the First Minister also managed to neatly sidestep Andrew Neil's pertinent question on whether such a stability pact would limit Scotland's room for manoeuvre. That's because the answer is of course it would! Nice try Andrew but two damaging admissions from the SNP Leader in one interview is probably a bit too much to hope for.

Willie Rennie gets it

When, oh when, are the SNP going to realise that they will not have the full range of fiscal powers that they want if Scotland does not have its own currency? John Swinney is talking through his hat. If he wants 'real independence' he needs to go the whole hog and cut loose from both Westminster and Brussels. We can't have an independent monetary or fiscal policy while tied to sterling or the euro. It just doesn't work. Sharing a currency with another country means agreeing on spending limits, interest rates, acceptable inflation and so on and so on (if we are lucky). If we are unlucky it means having our fiscal policy dictated to us by Germany. If Willie Rennie can grasp that then surely the Finance Secretary can grasp it. No?