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20 May 2013


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David Comerford

I think John Swinney's "glib" response reflects the way the world is moving, see for example Angus Armstrong (NIESR) paper presented at ESRC meeting on Scottish independence on 2nd May in Edinburgh: "Bank of England have stated their intention to moving towards ‘subsidiarization’ of foreign banks". There is nothing to stop RBS, a Scottish bank, owning 100% of Natwest, an English bank, and for Natwest to function and be capitalised entirely under English rules. Likewise Lloyds is already an English bank and could easily bring the English parts of HBoS under an English legal entity.

I think John Swinney is correct to say that the importance of financial services to the Scottish economy is smaller than its importance to the rUK economy (but specifically the London economy) and to say that the scale of the activities of the financial services sector need not change with independence. Especially as subsidiarisation in the other direction would lead to small head offices of Barclays Scotland, HSBS Scotland etc being set up.

Angus McPhee

"While regulatory reform of banking is welcome no one seriously believes that the risks of a serious banking crisis in the future are much reduced."

Are you saying the UK Government has failed to reduce the risk of a serious banking crisis? A great advert for it's continuation and our confidence in it.

You then suggest that the main risk to a Scottish economy is the failure of the (Scottish based) banks, those same ones that you say will likely to have moved their operations out of Scotland should the markets believe that's a serious risk.

Ian Jenkins

However the financial rules in the West may change in the wake of the great recession/depression. Also amid concerns about cheating it seems that any rules governing global finance, including banking, tax and audit, will need to be enforceable. The UK's Public Accounts Committee and the US senate show agreement on reversing some of the deregulation. Moreover the head of NATO expressed his exasperation recently - all nations, even NATO members despite article 2 of the treaty, do not play by the same rules in the 'one-size-fits-all' global economy.

In fact, at the weekend the boss of Google admitted that political hostility in the US the UK and elsewhere to multiple tax regimes means that international tax law should be reformed.

But can Westminster show the will to move in the direction of weakening the financial arbitrage we see at present, or is it too compromised? This year it has the rare opportunity of chairing the G8, a potentially powerful lobby group at the G20.

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