JOHN Swinney has said the SNP could go into a second independence referendum arguing Scotland could keep the pound despite one of the First Minister’s own economic advisers suggesting the policy was a “mistake” the first time round.

Mr Swinney said the Nationalists might go to the country again advocating a currency union with sterling, even though it was seen as a key weakness in the Yes case of 2014.

The Nobel prize-winning economist Joseph Stiglitz, a member of Nicola Sturgeon’s Council of Economic Advisers, also said recently a separate Scottish currency was a better option.

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He said in August that the SNP government had told voters they would keep the pound after independence because “they wanted the smoothest transition possible”.

He said: “I think in hindsight that may have been a mistake. What they would have needed to do is perhaps to resurrect the Scottish pound, and let it float.”

Sharing the pound with the rest of the UK had also been opposed by former SNP depute leader Jim Sillars, leading Yes campaigner Dennis Canavan and the Greens.

On the eve of the Brexit vote in June, Ms Sturgeon also suggested that an independent Scotland might use the euro if the UK voted to leave the EU, rather than a weakened pound.

She said: “It is not the SNP's policy to seek entry to the euro… But these are decisions and discussions that, yes, we will have if we are in the scenario of a Brexit."

However speaking at a fringe event at the SNP conference yesterday, Mr Swinney, who was finance secretary in 2014 and is now education secretary, again mooted using sterling.

Speaking shortly after Ms Sturgeon warned she was deadly serious about a second referendum in light of Brexit, Mr Swinney said he didn’t not know if the Yes side would have a fresh argument on currency whenever another vote on leaving the took place.

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He admitted that, although he had been at the “epicentre” of the economic argument for independence, it had not been “sufficiently compelling” in 2014.

He said: "I took what I thought were the best decisions. I would love the currency issue to have been one which glided through nice and smoothly and didn't cause any disruption, but the other options we considered were not without their challenges.

"I don't regret anything about the arguments I put forward. I have to honestly accept they weren't sufficiently compelling because we didn't win the referendum, which is why we have to be open minded about how we pursue these arguments in the future."

Asked if that meant nationalists would pursue a different economic policy at a future independence, he said: “I don't know if it necessarily has to be. Many people said the key argument was the one that George Osborne put forward [refusing to allow a currency union]. I thought the George Osborne prosecution of that argument was one of the factors that drove people into our arms because they resented being shoved around by a Tory chancellor. And where is he now? Not at the Treasury, so it's funny how the world goes."

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He added: "Our arguments [in 2014]... were compelling enough to get support for independence from 30 to 45 per cent but they weren't enough to get it over 50 per cent.

"To get it over 50 per cent, we've got to be prepared to develop stronger arguments, that's why we've established the Growth Commission to address directly the issues that remain."

Scottish Labour’s Education spokesperson Iain Gray said: “John Swinney is the man in charge of Scottish education. You would think he had enough to be getting on with rather than spinning fantasy about a currency union Scots which rightly didn't believe in 2014.”

Mr Swinney was also accused of hypocrisy by the Tories after it emerged he will tell today’s conference he wants to devolve more power to communities by saying line: "We will trust the people to make the big decisions about their future. That is our creed”

Tory chief whip John Lamont said if that was the SNP’s creed, the party wouldn’t be agitating for a second referendum: “The SNP is always happy for democracy to take its course, except when voters don't provide the answer nationalists want. If John Swinney means what he says, he'd listen to the two million people who voted No by a decisive majority in 2014."

Economy Secretary Keith Brown last night claimed some businesses “vehemently” opposed to independence in the past now saw it as protection against the greater uncertainty of Brexit.

He told a CBI-hosted fringe event there "seems to be something of a change right now", adding: "There are businesses which were pretty vehemently No last time that are looking at that amongst the other options."