Salmond says Scots could keep pound

The UK Government could not stop an independent Scotland keeping the pound, Alex Salmond said yesterday as sterling moved to the heart of the debate about the Union.

The SNP's First Minister hit back at suggestions from ministers in London that Scotland might not be allowed to retain the pound and would have to commit to joining the euro as the price of joining the European Union.

Mr Salmond told the BBC's Politics Scotland programme: "Sterling is not owned by George Osborne. Our position is, let's use sterling until we're able to take a decision on the euro."

UK ministers say Mr Salmond's position is flawed because interest rates would continue to be set by the Bank of England. They say that could leave a breakaway Scotland with less power than now because the Bank would no longer have to take account of economic conditions north of the border when setting interest rates.

David Cameron will meet Mr Salmond to discuss plans for a referendum, it was announced last night. But Downing Street urged Mr Salmond to accept an invitation to meet Michael Moore, the Scottish Secretary, in Edinburgh.