The government will announce soon whether a Scottish vote for independence from Britain would be legally binding, Prime Minister David Cameron said on Sunday.
Cameron told the BBC uncertainty over the timing, result and legal implications of the referendum planned by the party in power in Scotland were damaging the Scottish economy.
The pro-independence Scottish National Party (SNP) won a majority in Scotland's devolved parliament in an election last May - 304 years after the English and Scottish parliaments were united - and pledged to hold a referendum on independence within five years.
Scotland's First Minister, Alex Salmond, has said the referendum will be held in the second half of his five-year term, but the date has not yet been decided.
An Ipsos MORI poll last month found that, among Scottish voters certain to vote in a referendum, 38 percent would vote for full independence, three points higher than in August, while 58 percent were opposed.
Some commentators have questioned whether the government would be legally bound to accept a vote for independence in a referendum called by the Scottish government, which has devolved powers in some areas.
I think it is very unfair on the Scottish people themselves who don't really know when this question is going to be asked, what the question is going to be, who is responsible for asking it, and I think we owe the Scottish people something that is fair, legal and decisive, Cameron said.
In the coming days we will be setting out clearly what the legal situation is and I think then we need to move forward and say: 'Right, let's settle this issue in a fair and decisive way', he said.
Cameron gave no further details but a government source said he was referring to the question of whether the planned referendum would be legally binding.
Cameron said he believed it would be better to hold the referendum sooner rather than later but said the timing was a matter for the Scottish people.
Cameron's Conservatives and the other main political parties in parliament want Scotland to remain part of Britain. It would be desperately sad if Scotland chose to leave the United Kingdom, Cameron said.
Cameron said he believed Salmond knows the Scottish people at heart don't want a full separation from the United Kingdom and so he is trying to sort of create a situation where that bubbles up and happens.
A spokesman for Salmond said the position was very clear.
The Scottish government achieved an overwhelming mandate from the people of Scotland to hold the referendum in the second half of this parliamentary term, and that is exactly what we will do, he said.
As the prime minister (Cameron) has said ... the referendum is indeed a matter for the Scottish people to decide.
The only anxiety in these matters seems to be among Westminster-based (British) politicians, who have gone from a position of wanting no referendum to demanding one immediately - with no intervening period whatsoever, and no mandate to do so, he said.
(Reporting by Adrian Croft; editing by Tim Pearce)