Some
Scots support independence come what may and nothing would change their
minds. Other Scots want the UK to continue and are just as fixed in
their view. But for those people who have not already decided, the
debate is really a matter of weighing up the potential advantages and
disadvantages of independence. The fact that most commentary on the
issues involved is completely one-sided, can hardly be helpful for
people looking at the pros and cons in this way. The polarisation of the
debate means that nationalists frequently attempt to argue that the UK
has no benefits at all, while unionists frequently strive to portray an
independent Scotland as if we would be joining the Third World. But this
is to treat political opponents as if they were fools. There must be
something attractive about independence, otherwise the idea would not
have attracted the support of a significant number of Scots and we would
not be having the debate at all. Likewise, there must be something
attractive about the UK, otherwise we would have become independent long
ago. The essence of the debate should be an attempt to investigate
these advantages while assessing the corresponding disadvantages.
Looking
at the pros and cons of independence is to look fundamentally at two
issues, money and power. Economically, the main pro is North Sea oil. It
was the discovery of this resource which gave wings to the independence
campaign some 40 years ago. Without it few in Scotland would ever have
considered independence as an option. This is is not to talk Scotland
down, but rather it is to recognise that Scotland’s position without oil
would be not dissimilar to that of Wales, Northern Ireland and the
North of England. Those parts of the UK, which were centres of heavy
industry, have still not fully recovered from the decline of those
industries. The difference between a Scottish nationalist and a Welsh
nationalist is that independence is an economically viable option for
the former, while it is not for the latter. The difference is oil.
At
the moment oil revenues are shared in Britain. They help Scotland
economically, but they also help Northern Ireland, Wales and England.
But if we had these revenues to ourselves, clearly we would get more.
It’s like a cake divided between four at present. If Scotland had the
cake to ourselves, we could scoff the lot. For people, supposedly on the
left, to put forward this argument has always struck me as
hypocritical, but nevertheless, having all of the revenue from oil is
clearly something to be counted on the pro side of the debate about
independence.
But
what of the the downside? At present Scotland gains a share of central
government funding from the UK, calculated according to the Barnett
formula. This enables the level of public spending per person in
Scotland to be somewhat higher than in England. In the event of
independence, this funding would obviously cease. As a newly
independent country, we would also have a number of disadvantages. Our
borrowing costs would certainly be higher than the rest of the UK (rUK).
Assuming that we kept the pound, we would be borrowing in a foreign
currency, which is inherently more risky than borrowing in our own
currency. Moreover, as a new country we would have to establish a track
record economically before the markets could assume that we would be
economically prudent. We would likewise have certain start-up costs. We
would have to set up things like a tax collecting agency, a pensions
agency and a passport’s agency, not to mention an army, navy and
airforce. No doubt, much of this would already be in place, but just as
any new business has start-up costs, so too would Scotland. There would
be some loss of the economies of scale, which at present we enjoy by
being a part of the UK and most likely some disruption to the UK single
market, which to an extent depends on us all living in the same country.
No
one knows the exact figures and anyway they are subject to the bias
inherent in this debate, but it is reasonable to guess that the
advantages of having all of the oil revenue versus the disadvantages
already mentioned, would leave us perhaps a little bit better off than
we are at present, but not by much and maybe not at all. But it must be
remembered that oil revenues fluctuate greatly and anyway are in
decline. Scotland will not become Norway. Its too late and besides we
are not remotely like Scandinavians. The main economic advantage of
independence therefore can be summed up as a much greater share of a
declining resource. Even if it we were to be better off in the short
term, what about 30 years from now?
The
other main advantage of independence is that we would not have to share
power with Westminster. We would have complete political control from
Edinburgh. But let’s look at how the political situation works at
present. Under devolution the Scottish parliament already controls
health, law, education, local government, road, rail and air, farming,
fisheries and sport. The Scotland Act 2012 gave the Scottish parliament
the power to raise and lower income tax. At present around two thirds of
public spending is controlled by the Scottish parliament. What this
means, in practice, is that we already have two thirds of the power.
What power on the other hand is retained by Westminster? The UK
government controls defence, macroeconomic policy, foreign affairs,
immigration, broadcasting, social security, pensions and the
constitution. What this all means is that the debate about independence
is really a debate about gaining power over these issues as to all
intents and purposes we are already independent with regard to those
issues that are already controlled by Holyrood.
People
in Scotland are able to influence the powers that are retained by
Westminster, because we have a vote in each General Election and MPs
from Scotland have frequently been important members of successive
governments. This would clearly cease to be the case in the event of
independence. Moreover, if Scotland became independent and kept the
pound, it is doubtful that we would gain much control over macroeconomic
policy. The Bank of England would still control matters such as
interest rates and monetary policy. To remain successfully in a currency
union with rUK, Scotland would largely have to follow the same economic
policies as rUK. It might even be necessary for the rUK Chancellor to
oversee the Scottish budget. The foreign policies of most Western
European nations are generally very similar and follow reasonably
closely the line of the larger powers. To be frank, we neither know nor
care about the foreign policy of a country like Denmark and Scotland’s
foreign policy would be similarly irrelevant. If an independent Scotland
were to be a member of NATO, we would be further pressured to follow
the American line or face the consequences of US displeasure. If an
independent Scotland wanted to retain an open border with rUK, we would
not be able to have our own immigration policy as immigrants to Scotland
could immediately move south of the border. Scots should ask themselves
if gaining control over broadcasting, losing the BBC and ITV, would
give us better television and radio. Would gaining control over defence,
including setting up our own version of MI5 and MI6 really make us
safer? Each of us should think seriously about whether we would rather
have our pension and social security rights guaranteed by the UK
treasury or by a newly formed Scottish treasury?
While
there are advantages to Scottish independence, there are also
disadvantages. Most importantly, we would be giving up the shared
solidarity of being citizens of UK. What strikes me as strange is that
we would be turning ourselves into foreigners in order to take control
over matters, which are often fairly abstract like the constitution, or
which work well at a UK level and which frequently are not at all big
issues at the average election. Holyrood already controls the day to day
issues that affect our lives, like health and education. In the event
of independence, there would be a new sovereign nation called Scotland.
There would be a seat at the UN and no doubt, there would be a lot of
flag waving. But practically speaking, we would not have gained much
extra power. Breaking up the UK would cause years of negotiation and
uncertainty. It would certainly spook the markets and damage the
economies both in Scotland and the other parts of the UK, but the
potential gains appear marginal and scarcely worth the trouble.
People
who are desperate for Scotland to be a sovereign nation will not be
concerned by any of this. It’s always worth remembering that some people
would argue for independence even if they were to be worse off, because
their ambition that Scotland should be a nation again is central to
their sense of identity. The rest of us however, need to carefully
consider the pros and cons of independence. Otherwise, the deal we are
being offered when weighed in the balance might be found wanting.
