At a UK level, the Financial Services Compensation Scheme was established as a statutory body under the Financial Services and Markets Act 2000.It guarantees to compensate bank account holders to the extent of the first £85000 that they hold in any account covered by the scheme, in the event that a bank or building society becomes insolvent, goes bankrupt, or otherwise cannot return deposits. Accounts covered by the scheme include accounts at all major high street banks. The scheme obviously provides people with a limited but welcome amount of assurance in these increasingly unstable times.
An unequivocal declaration by the Scottish Government that it will act to ensure that such protection of bank deposits shall continue in the event that Scotland becomes independent would be welcomed by bank account holders, and it would also prevent the possibility that a significant number will move money out of Scotland, an action that may have a detrimental and turbulent effect on the economy, prior the referendum.
The reason that the Scottish Government declaration needs to make clear that the guarantee is without any dependence on possible future actions by any other party, including by the rump UK government, is that in an independent and sovereign country it is the government of that independent and sovereign country to which the people of that country look for protection. People in Scotland do at the moment benefit from this very specific kind of bank deposit protection from the UK government, and we need to be sure now that we will remain protected in the event of independence. Only the Scottish Government can make that promise, and it is in our interests if we receive its promise prior to the independence referendum.