The Scottish Parliament at Holyrood. Whatever the referendum results, more powers will be devolved to the government. Photo: Getty
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Leader: The United Kingdom in its current form is unacceptable

Whatever the outcome of the referendum the status quo should not endure. Constitutional change is coming to Scotland and the rest of the UK, and we are all the better for it.

There are now fewer than 100 days remaining until the Scottish independence referendum. As Alistair Darling says in our interview this week: “This is a vote that’s not like a normal general election. This is something the nationalists have to win only once, by one vote. It is irrevocable. You would never come back.”

Despite the criticism of Mr Darling’s performance as head of the No campaign, the polls suggest that the unionist side remains on course for victory. But whatever the outcome of the referendum – and it could be very close – the status quo cannot and should not endure. Constitutional change is coming to Scotland and the rest of the UK, and we are all the better for it.

Before the creation of the Scottish Parliament in 1999, it was predicted, in the words of the former Labour cabinet minister George Robertson, that devolution would “kill nationalism stone dead”. Yet it was those who argued that devolution was “a process, not an event” who were correct.

Under the terms of the Scotland Act 2012, Holyrood will win the right to vary the country’s income-tax rate by up to 10p, as well as gaining complete control of stamp duty and landfill tax and new powers to borrow for capital expenditure. All three of the main Westminster parties have vowed to go further than this, with the Scottish Conservatives pledging on 2 June to devolve income tax in full to Holyrood.

That the party that campaigned against devolution for so long (albeit on the grounds that it would serve to encourage nationalism) has changed its stance is evidence that the UK political establishment has belatedly accepted the long-held desire among Scots for greater autonomy, whether for full independence or so-called Devo Plus or Devo Max. However, Tories’ hopes of a revival in Scotland, where they have only one MP (out of 59), will be disappointed. The Conservative and Unionist Party has been decisively defeated north of the border.

Perhaps, of the three main parties, it is only Labour that can win a fair hearing in Scotland, if indeed it deserves to. It is regrettable, therefore, that its proposals for further devolution have been so timid. Unlike the Conservatives, Scottish Labour is proposing only to allow Holyrood to vary income-tax rates by up to 15p on the grounds that going any further would risk triggering a “race to the bottom” and undermine the ability of the UK to redistribute across the nations. Neither argument bears scrutiny. Income tax represents just 23 per cent of UK tax revenue, leaving much to redistribute, and it is up to Labour to win the argument for progressive taxation, not to maintain control for fear that it will lose. Such caution validates Alex Salmond’s argument that only by voting for independence will Scots win the new powers they both want and deserve.

Further devolution is also necessary to address the grievance felt among English voters that Holyrood is able to spend money – on free university education, free prescriptions and free social care for the elderly – without having the responsibility of raising it.

Where Labour has an advantage over its rivals is in recognising that new powers for Scotland must be coupled with greater autonomy for England and for its cities. Labour has pledged to devolve at least £20bn of funding to the regions, a figure that should increase once Andrew Adonis’s growth review is published in full. It is hoped that, by ensuring decisions are made closer to those they affect, trust can begin to be restored in a discredited and overly centralised political system.

Beyond the important but technocratic arguments over the currency, North Sea oil and EU membership, the case for the Union is ultimately emotional: what unites the people of these islands is surely more important than what divides them. The possibility that the most successful multinational state in modern history could soon be broken up is cause for regret. For now, the Union might yet endure. But unless the grievances that have led to our present constitutional crisis, in Scotland and in England, are resolved, the ties that bind us will become ever more frayed. One day, quite soon, they might well snap.

This article first appeared in the 04 June 2014 issue of the New Statesman, 100 days to save Great Britain

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Scotland's huge deficit is an obstacle to independence

The country's borrowing level (9.5 per cent) is now double that of the UK. 

Ever since Brexit, and indeed before it, the possibility of a second Scottish independence referendum has loomed. But today's public spending figures are one reason why the SNP will proceed with caution. They show that Scotland's deficit has risen to £14.8bn (9.5 per cent of GDP) even when a geographic share of North Sea revenue is included. That is more than double the UK's borrowing level, which last year fell from 5 per cent of GDP to 4 per cent. 

The "oil bonus" that nationalists once boasted of has become almost non-existent. North Sea revenue last year fell from £1.8bn to a mere £60m. Total public sector revenue was £400 per person lower than for the UK, while expenditure was £1,200 higher.  

Nicola Sturgeon pre-empted the figures by warning of the cost to the Scottish economy of Brexit (which her government estimated at between £1.7bn and £11.2.bn a year by 2030). But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose considerable austerity. 

Nor would EU membership provide a panacea. Scotland would likely be forced to wait years to join owing to the scepticism of Spain and others facing their own secessionist movements. At present, two-thirds of the country's exports go to the UK, compared to just 15 per cent to other EU states.

The SNP will only demand a second referendum when it is convinced it can win. At present, that is far from certain. Though support for independence rose following the Brexit vote, a recent YouGov survey last month gave the No side a four-point lead (45-40). Until the nationalists enjoy sustained poll leads (as they have never done before), the SNP will avoid rejoining battle. Today's figures are a considerable obstacle to doing so. 

George Eaton is political editor of the New Statesman.