The SNP’s latest document “A stronger economy with independence” masquerades as some sort of objective analysis put together by
impartial observers. We know however that those civil servants who were paid to
write it depend for their jobs on coming up with the right answers. Telling
Sturgeon that we would be better off staying in the UK would be like Thomas More
telling Henry the Eighth that he couldn’t have a divorce. Off with his head.
We start with how wonderful Scotland is in every
respect and then move on to how awful the UK is every other respect. What’s odd
about this is that the other parts of the UK subsidise Scotland and have done so
for some time. If Scotland is so wonderful and the other parts of the UK are so
awful, how can it be that they pay us by means of the Barnett formula more than
they receive themselves?
At this point my Scottish nationalist friends tell me
that we pay taxes and in fact we subsidise the English. But the SNP document
admits that Scotland runs a deficit and would do when beginning independence. So
how can we be subsidising anyone else? Of course, the UK also runs a deficit,
but the UK finances this through borrowing. The UK may overall be making a
loss, but part of the reason for this is that it subsidises Scotland.
The SNP does not borrow (though it could), does not
make a profit and instead spends more than it raises in taxes in Scotland. If
Scottish nationalists disagree with this, they ought to apply to Sturgeon to
give up the Barnett formula and refuse all money from the Treasury from now on.
If they did this, I promise that I would vote for independence.
I will skip briefly over the bits about currency except
to reiterate that I don’t fancy using sterling unofficially without a lender of
last resort. I don’t see how our banking sector could survive. I also don’t fancy
everything I own being converted into Scottish pounds. Nor do I believe that an
independent Scotland in the EU could long stay out of the Euro, not least
because it would be its best currency option.
The SNP wants to have a New Scotland Fund after
independence. The idea I think is to emulate Norway’s wealth fund. But while
this might have worked if Scotland had become independent in the 1970s, it is
hard to see how it is going to work now. Scotland is running a deficit. Even
the SNP admits this. Well, any money it puts into the New Scotland Fund is
going to have to come from cuts elsewhere in the budget or from borrowing. But cutting
spending is called austerity and that is something Tories do, while borrowing
to create a New Scotland Fund is like me borrowing from the bank only to put
the money in the mattress. I can call my mattress a New Scotland Fund if I
like, but I still will have to pay it back to the bank. It’s not my wealth. It’s
the bank’s. It’s not a wealth fund. It’s a debt fund.
The SNP thinks that it will boost trade by joining the
EU. But after nearly 40 years of UK membership of the EU Scotland traded vastly
more with the other parts of the UK than with the EU. Why would this suddenly
change if Scotland joined the EU?
The problem the SNP has with EU membership is that it
puts us in the wrong trading bloc. Scottish trade with the EU might increase if
we joined, but at the cost of our trade with the former UK. But given that we
trade vastly more within the UK than with the EU, our overall trade position is
going to be worsened.
The SNP as usual has an exceedingly optimistic view of
EU membership and Scotland’s relationship with the former UK. Trade with the former
UK it thinks will be seamless, even though we know that trade between the EU
and the UK has been difficult at times with bureaucracy, form filling and delays
even between Britain and Northern Ireland (which is de facto in the EU’s Single
Market). But none of this would apply to Scotland. Markies may not be able to
sell sausages in Belfast, but no one would dare make a Scot fill in a form because
we wear blue woad.
The SNP thinks that Scotland’s membership of the EU
would be like Ireland’s. Scotland would both be part of the Common Travel Area
and be given free movement across the EU. Scotland would be part of Schengen,
but would be given an opt out from the border control aspects. So, there would
be no need to show passports between England and Scotland and we would have
exactly the same access to health care and benefits in the former UK as we do
at present.
It may be that the SNP’s wish list is fulfilled, but
it is worth pointing out that none of these things would be up to the SNP. The
Common Travel Area was set up in the 1920s because of Irish independence and to
avoid border controls between the Irish Free State and Northern Ireland. It
exists now because of thirty years of terrorism and the hope that an open
border helps us keep the peace.
The former UK Government might respond to Scottish
independence in the same way. It might offer Scots reciprocal rights. But it
would be under no obligation to do so. No other member of Schengen gets to have
an open border between the EU and the non-EU. But again, Scotland is special.
One of the key aspects of SNP policy is that it wants
to have much more liberal immigration policies in order to address depopulation
in Scotland. But the Common Travel Area depends on its members having a similar
immigration policy to the UK. The SNP wants to have open borders with the EU so
that anyone from the EU can arrive in Scotland. This means rather than getting
in a dinghy on the French coast it would be cheaper just to fly to Edinburgh
and get the bus to London. What is to stop this if there are no passport
controls? It’s not at all clear why a former UK Government would agree to this.
The SNP’s whole economic argument depends on it not
being allocated a population share of the UK’s national debt. Instead, it
offers an annual solidarity payment. The reason for this is that UK debt as a percentage
of GDP is approximately 96.6%. It is difficult enough for the UK to maintain
this level of debt as the recent crisis showed, but it would be completely
untenable for a newly independent country to begin life with debt approaching
100% of GDP.
The solidarity payment offered by the SNP has of
course not been negotiated let alone agreed. If Scotland were to avoid accepting
its population share of national debt, then the former UK’s debt would increase
as a percentage of GDP owing to the loss of Scotland. The former UK’s credit
rating might also be downgraded as the break up of the UK might be seen as
making lending to the former UK riskier.
The SNP wish list then amounts to saying we will not
accept our share of the money you spent on Covid furlough, nor on capping our
energy prices, nor indeed on decades of Barnett and everything else we have received,
we will instead pay you a token solidarity payment and in response you will
give us everything we want including open borders, seamless trade and you will
continue to pay us benefits and healthcare so that if we happen to get drunk in
the fountains on Trafalgar square and trip up and hit our heads you will look after
us for free. Really?
I have absolutely no idea what would happen if
Scotland were to vote for independence. No one has tried to break up a first
world country, like the UK, France, Japan or Germany. I think it would damage
the former UK more than it guesses, but it would damage Scotland still more.
No one has tried to start a new country when
approximately 50% are opposed to it being set up. How would the Pro UK 50% behave?
Would we all just happily get on with being new Scots? I’d stay. My work is
here, but I’m not sure how much I’d want to help. We just don’t know what would
happen, because no country has become independent with such a small percentage
wanting it to do so. Every other country I know of gained independence after an
overwhelming majority wanted it. But in Scotland we need just 50% and one vote.
How much of the Scottish economy is intertwined with
the other parts of the UK? We don’t know until we put an international border and
see if it makes a difference.
The SNP thinks that it will get the best possible deal
both from the former UK and the EU, but it fails to take into account that just
as the EU chose to drive a hard bargain with the UK over Brexit, so the former
UK might choose to drive a hard bargain with Scotland.
The SNP presents the best-case scenario as inevitable even
before it has begun negotiations. It is arguing that we would have exactly the
same rights in the former UK as we do now, there would be open borders and no
disadvantages despite us using the pound without permission and refusing to
accept our share of mutually incurred debt. It really is as if the Scottish civil
service is scared to tell Sturgeon the truth. Off with their heads.
