Passing by without too much of a murmur south of the border is the Scottish independence referendum due to be held in September of next year. The relatively lack of comment is in direct contrast to the significant implications for the rest of the UK should the Scots wish to go it alone, not least on the thorny issue of the EU; would a breakup of the UK make our EU membership null and void? I’ve not heard a convincing answer on that one yet.
That aside, the referendum campaign has thrown up some interesting parallels to a potential EU referendum post 2015 and some lessons we can learn from. It should be noted first that there are one or two differences; with the except of a couple of forays by Cameron north of the border the Westminster establishment has largely refrained from interference. In addition polls consistently show Scottish voters supporting staying in the union, rather than exiting. Factor in the “don’t knows” and the inherent “status quo effect” of around 15%, then it’s clear the SNP and Alex Salmond has a very difficult, if not impossible, task. One suspects that Salmond has been forced to call a referendum earlier than he might have wished due to his success of winning a majority in 2011, leaving him little political choice.
Yet the useful parallels are imbued in a campaign that wishes to seek exit from a union it is a member of, a break from the status quo against the wishes of the establishment. Thus using the Scottish referendum as a dry run in anticipation of an EU one, it is immediately clear the effect major errors have on success or otherwise. Throughout it’s becoming increasingly apparent that the SNP has no coherent exit plan in place which is compounding their already poor position – their case has been unraveling.
The referendum may have come earlier than Salmond hoped, but he seems remarkably unprepared given that the SNP is a party that has been in existence since 1934, and Salmond has been its leader since 1990 (albeit with a 7 year hiatus between 2000 and 2007).
Perhaps the lack of detail was the reason that Salmond preferred initially to concentrate on a sense of Scottish national identity and patriotism culminating, just before last year’s Olympics, in the rather ridiculous phrase Scolympians:
In a bizarre intervention, the First Minister has devised a new group name for the Scottish athletes at the games that studiously avoids any British connotations.
Mr Salmond issued a good luck message urging everyone to cheer on the “Scolympians”, an inelegant combination of the words “Scottish” and “Olympians”.
Earlier this week, he issued a press release congratulating Sir Chris Hoy as being chosen as the Olympic flag-bearer for Team GB without mentioning the team’s name.
But the scrutiny won’t go away nor can it be papered over by vacuous appeals to national identity and scrutiny is what is now happening. For years the SNP has suggested that they received legal advice that an independent Scotland could remain in the EU and as a consequence inherit the UK’s opt outs such as the Euro. Salmond went as far as to confirm it categorically (10:30 mins in):
The BBC’s Andrew Neil asked the First Minister on March 4 if he had sought legal advice. Mr Salmond replied: “We have, yes.
But it turns out that was never the case, as the Scottish Sun waded in with the headline “EU Liar”:
THE SNP were forced into a humiliating climbdown yesterday after finally admitting the government had never taken legal advice on Scotland’s entry to the EU after independence.
The party’s referendum chief Nicola Sturgeon announced they were dropping a bid to block demands for them to reveal law experts’ guidance.
The Nats’ challenge has already cost taxpayers £12,000 as they battled to keep the details secret.
For a country to split while still being members of the EU would be uncharted territory legally, however many including the EU Commission, are of the opinion that Scotland would have to reapply for membership:
A letter from Mr Barosso to the House of Lords economic committee, which is examining the independence question, also confirmed his position that a new independent state would “become a third country with respect to the EU”.
“What I said, and it is our doctrine and it is clear since 2004 in legal terms, if one part of a country – I am not referring now to any specific one – wants to become an independent state, of course as an independent state it has to apply to the European membership according to the rules – that is obvious.”
Asked whether an independent country would have to renegotiate its terms, Mr Barroso said: “Yes.”.
Which then throws up the question of what happens to Scottish exports to the Eurozone while renegotiation was happening, given that they would have no right of access to the Single Market in the meantime as they immediately become a “third country”. Exports would simply stop overnight. Such a possible scenario is a damning indictment of the SNP’s lack of preparation and as a consequence has been hugely damaging to their cause.
Another big question is what happens to currency. This question has long been a problem for the nationalists. They have at various times supported an independent Scottish currency or even been cheerleaders for membership of the Euro. Currently they have instead settled on a currency union between an independent Scotland and the rest of the UK, a policy that seems to be a hasty response to changing circumstances, not least the Eurozone crisis. In short a least worst option.
But this comes with its own problems. It requires agreement of the rest of the UK and there’s no guarantee of that. Also, as the Eurozone is painfully aware, currency union requires political and fiscal union to work. So there would need to be budgetary and fiscal constraints in place, a common system of banking regulation, so that the lender of last resort is not underwriting the debts of financial institutions over which it has no control. The UK will inevitably insist on tight controls on Scotland’s ability to borrow, and on its ability to vary the structure of its taxes. It will be political union in all but name. An independent Scotland would have no influence over the Bank of England but would still effectively be under its control, thus making a mockery of independence. Another ill thought-out policy.
Then there’s the issue of the welfare state. A vote to leave the UK would be a vote to leave its institutions, including Department of Work and Pensions and the services it provides. A report backed by SNP ministers warned that pensions are at risk:
The study, by the Scottish Government expert working group on welfare, said creating a new system immediately after independence would be so complex that there would be a “significant” chance claimants would not receive their money.
This would also affect millions of pensioners and welfare claimants in England, the report claimed, because their payments are processed at Department for Work and Pensions (DWP) offices in Scotland.
But the report’s authors were forced to admit they did not know how the Scottish benefits system would be administered after [transitional period] because they had too little information about the policies that would be pursued.
The lack of detail means for Salmond that fear, uncertainly and doubt will be the deciding factor in the referendum – dull detail matters, not empty rhetoric. The lack of preparation will put back Scottish independence for generations meaning Mr Salmond, undoubtedly against his wishes, will die a UK citizen. It has turned into a campaign where professionals are knocking seven bells out of the amateurs as Jim Sillars in the Holyrood magazine observed (my emphasis):
These inherent fault lines should have been addressed long before there was any launch of a Yes campaign. The lack of what I call “the Bible” – that is, a document based on asking all the difficult questions and providing the answers, which then delivers solid well researched, intellectually tight material for activists to use – is proving fatal. Currency, EU membership, Nato, pensions both state and private, are but four examples of work not done or sloppy thinking.
Given the woeful performance of the SNP leadership so far, it is a foolish gamble to believe that when they produce the civil service-created White Paper in the autumn, that it will fix things. There needs to be a much wider involvement in the production of a “Bible” without which Westminster will continue setting the agenda and continue to run rings round the Yes side.
It all sounds so wearily familiar, but at least we’ve been warned. In an EU referendum we also need to provide a “Bible” that answers difficult questions such as the one posed by Autonomous Mind:
On Day One of [unilateral withdrawal] how will British goods will be landed in continental Europe and sold into the EU market.
Otherwise we follow Salmond down the path of glorious failure.