The re-election of a pro-independence majority to the Scottish Parliament shows that the next five years will be dominated by the quest for a second independence referendum. Conventional wisdom is that the Scottish Parliament will pass a Bill legislating for that referendum, daring Westminster to strike it down, making the separatist position more powerful, like a constitutional Obi-Wan Kenobi.
This may be how things play out. Another option, of course, is that any interested party could refer the legislation to the courts as being ultra vires. However, it would still present a risk that permission to hold such a referendum would be given, putting Westminster on the back foot once again.
But there is a third way: start the independence negotiations.
The Achilles’ heel of the Nationalists is their preference for deliberate obfuscation over the financial situation in Scotland, their incompetence in running public services, and their avoidance of policy detail. The 2014 White Paper, with its fanciful oil revenue projections, has been utterly discredited. Asking Scotland to vote again, effectively blind to what they were voting for, would be a crime.
The Achilles’ heel of the Nationalists is their preference for deliberate obfuscation over the financial situation in Scotland.
Boris Johnson should say that, as Prime Minister for the entire United Kingdom, responsibility rests with him to ensure that tragedy doesn’t befall any part of the country as a result of the actions of devolved administrations. It could be fairly pointed out that the whole country has learned from Brexit that negotiations after a vote are difficult and that it would be unfair for Scottish voters to be expected to vote for such vague promises. But he realises that such a sensitive and emotive topic should not be led by him or any other Westminster politician. Instead, he will set in motion the process of creating a joint Scottish independence White Paper, mutually agreed by the two governments.
He should also stress that he and his government cannot be expected to spend large amounts of his time on negotiations as a result of a decision in just one region. (He could also point out that the SNP government in Scotland should be focused on their responsibilities, too, but chance would be a fine thing.) In any case, the ideal position for him is to have nothing whatsoever to do with the negotiations. Instead, he should set up a body of civil servants to work with a delegation from the Scottish Parliament. There would be a framework for negotiations, working predominately behind closed doors discussing the aspirations and demands from the SNP and working out a broad outline of a deal. This will cover areas such as citizenship, pensions, debt, defence, etc. It might not be possible to cross every ‘t’ before the referendum but a rough shape should be in place – something clear enough to vote on. The rUK could be reasonably magnanimous towards Scotland but without agreeing to anything unsustainable.
Next, to ensure that Scotland could make a swift transition to independence, and not spend years after the vote haggling and arguing even while the country burns under the uncertainty, another body will supervise and assist the SNP in building the required apparatus of state. It is essential that these institutions are set up before Scotland leaves the Union, so let’s agree timescales for establishing them. Transfer responsibility for all welfare payments, including pensions, to Scotland. They can’t simply hand back the management of certain benefits because it’s too hard after independence.
Invite a panel of experts to act as consultants to this body. Appoint internationally-recognised experts in the fields of economics, currencies, monetary and fiscal policy to ensure that the SNP’s plans add up and would be unlikely to result in swift national bankruptcy. Invite a member of the European Commission to outline requirements for membership to be considered and to be fulfilled. This will include matters such as the border with England. The timescale for accession doesn’t have to be set in stone, but it must still appear in the White Paper.
Finally, to maximise transparency, redesign the UK-wide system of pooling and sharing to make transfers explicit. Scrap the Barnett formula in favour of a Union Fund support transfer which must be formally requested by the Scottish Government finance spokesperson on budget day. This will avoid the fights over the veracity of GERS every year. Agree that independence cannot occur until the transfer can be eliminated and replaced by sustainable borrowing.
Scotland is already able to issue sub-sovereign debt. It is reasonable to say that, if Scotland is determined to negotiate for independence, all new borrowing for money spent in Scotland is borrowed by Scotland. Scotland’s share of the present national debt would be frozen, with the repayment terms agreed in the negotiations.
Once these bodies are established, Westminster can take a step back. It is a then purely a matter for the Scottish Government when they can hold their vote. They simply need to have taken over sufficient aspects of statehood, must be in a financially stable position, and the SNP must say they agree to the current terms on the table from the Westminster negotiating team. At that point, the White Paper can be presented to the Scottish people, and the referendum can be held six months later. If it is indeed a vote to leave the UK, that can be finalised within the year.
On the other hand, if it is a vote to remain within the UK, the Scottish sub-sovereign debt can be transferred back to the UK Exchequer to benefit from lower borrowing rates, but all else remains. Scotland would be left with something akin to devo-max and there would still be fiscal transfers to ensure broadly common standards of public service delivery to all British citizens via the Union Fund.
There are three advantages to this approach for the pro-Union side. First, it would be hard for the SNP to refuse to partake in such negotiations. How could they reasonably object to making a clear proposition to the Scottish people? Second, it would draw the sting from the constant clashing between governments while giving each space to actually govern their country without constant distraction. Third, support for independence is actually remarkably weak. A Panelbase survey in today’s Sunday Times indicates that although 62 per cent of 16-35s support independence, this halves to 31 per cent if they think they will be just £1000pa worse off as a result. Also, research from These Islands shows how much ignorance there is of Scotland’s financial state among the general population. Requiring the formalisation of these facts, put in context, and agreed by a panel of independent experts would do more to boost the case for the Union than any number of clever-clever interventions.
It might seem paradoxical, but the best way to save the Union might be to start negotiating its dissolution.
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