UK finance minister denies report that independent Scotland would keep pound

LONDON, March 29 (Reuters) - British Finance Minister George Osborne on Saturday (Shenzhen: 002291.SZ - news) denied a newspaper report that Scotland may keep the British pound even if it votes for independence later this year, an issue at the heart of the Scottish secession debate.

Polls show the question of what currency an independent Scotland would use has been high in Scottish voters' minds ahead of an independence referendum on Sept. 18, with many worrying about the economic uncertainties a new currency would bring if they voted to end the 300-year-old union with England.

"Walking out of the UK means walking out of the UK pound," he said on Saturday in a joint statement with Treasury Chief Secretary Danny Alexander.

Scottish nationalists want to share the pound in a currency union with the UK and retain the services of the Bank of England. But the three main UK parties have united to reject that plan.

On Saturday, though, in a boost for the pro-independence lobby, the Guardian newspaper quoted an unnamed UK government minister as saying a currency union will eventually be agreed between an independent Scotland and the rest of Britain to ensure economic stability on both sides of the border.

"Of course there would be a currency union," the minister told the paper.

"There would be a highly complex set of negotiations after a 'yes' vote, with many moving pieces. The UK wants to keep Trident (BSE: TRIDENT.BO - news) nuclear weapons at Faslane and the Scottish government wants a currency union - you can see the outlines of a deal."

Scottish leader Alex Salmond has repeatedly insisted that nuclear weapons would be removed from their Faslane base on the river Clyde if Scots back independence.

Osborne said in the statement: "The Scottish government are proposing to divorce the rest of the UK but want to keep the joint bank account and credit card.

"The UK would not put its taxpayers at risk of bailing out a foreign country and its banks. Parliament would not pass it, and the people would not accept it.

"Any suggestion to the contrary is wrong."

Opinion polls have the separatists lagging with about one third support while about half of Scottish residents oppose breaking away. However, polls have narrowed this year and up to 15 percent of voters remain undecided. (Reporting by Stephen Addison; Editing by Raissa Kasolowsky)