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Is a U.K. breakup in sight?

by Hugh Cortazz

Is Britain about to break up? This is no longer a rhetorical question. A referendum on independence for Scotland has been called for Sept. 18, 2014. If the vote is in favor, Scotland could become an independent country on March 24, 2016. This would mean the end of the United Kingdom of Great Britain and Northern Ireland as now constituted.

Current opinion polls suggest that the majority of voters in Scotland have yet to be convinced of the case for independence put forward by Alex Salmond, Scotland’s first minister and leader of the Scottish National Party. But opinions could change in the months running up to the referendum, and the British government must consider the implications.

Scotland has a population of some 5.25 million — just under 10 percent of the total U.K. population of about 63.5 million. But population is only one factor. Most of the U.K. share of North Sea oil is found in waters that Scotland could claim and Aberdeen is a major oil industry center.

Scotland has a sophisticated financial services sector based in Edinburgh. Glasgow and the Clyde constitute a major industrial and shipping area. An important export industry is Scotch whisky. The British nuclear deterrent in the form of Trident nuclear submarines is based at Faslane in Scotland.

The kingdoms of England and Scotland became united when, on the death of Queen Elizabeth I in 1603, King James VI of Scotland became King James I of England. An act of union was passed in May 1707 and a parliament including representatives from Scotland was established in Westminster.

Following pressure for devolution of powers to the regions, a referendum was held in Scotland in 1997. A Scottish parliament with devolved powers was set up in Edinburgh and meets at Holyrood.

A similar assembly for Wales, which has a population of just over 3 million, was also set up at roughly the same time in Cardiff with somewhat less devolved powers. There is very little pressure in Wales for a referendum on Welsh independence although Welsh is widely spoken in the principality of Wales whereas Gaelic is hardly spoken in Scotland except in a few remote areas

The Scottish Nationalists who resent control from London argue that the formula under which a proportion of U.K. tax revenues are allocated to Scotland does not take a fair account of Scotland’s contribution to the U.K. economy. They have promised, if the vote goes in favor of independence, to revolutionize child care with the aim of getting more women back into work and to improve standards of social welfare.

The Scottish government has produced a white paper arguing the case for independence. This is long on aspirations and short on detailed responses to the problems that an independent Scotland would face.

In particular, the white paper does not provide an answer to the fundamental issue, which is that while public spending in Scotland today amounts to some £40 billion, revenue raised in Scotland amounts to only £27 billion. A Scottish independent government would have to choose between expenditure cuts and higher taxes.

The Scottish government has declared that under their plans the queen will remain queen of Scotland as well as of England. Scotland will, they assert, retain the pound sterling as their currency.

An independent Scotland will remain part of the European Union and the North Atlantic Treaty Organization (NATO). But as the British government has pointed out, these are not issues, which can be solved unilaterally.

There will have to be an intergovernmental agreement on the amount of government debt for which Scotland would be responsible. Retention of sterling as Scotland’s currency raises important issues about financial stability and control, not least the position of the Royal Bank of Scotland, which has its headquarters in Edinburgh and in which the British government own 83 percent of its shares, having had to bail out the bank after the financial debacle of 2008.

The member states of the European Union will have to agree to Scotland’s membership. It is possible that some EU countries, which include areas that might want similar independence, might see difficulties in welcoming Scottish membership. One possible objector might be Spain, in which Catalonia has a strong pro-independence party.

NATO may also have reservations unless a long-term agreement covering the Trident base can be agreed with Scotland and Scotland is able to maintain its contribution to joint defenses.

Independence for Scotland would have serious consequences for the British Labour Party and Liberal Democrats in The House of Commons. Of the 59 seats allocated to Scotland 41 are filled by members of the Labour Party and 11 by the Liberal Democrats. The Conservatives have only one Scottish seat.

An independent Scotland would mean that all these seats would disappear and it would make it much more difficult for the Labour Party to command a majority in the House of Commons in the future.

It is hardly surprising in these circumstances that the “No” campaign in the referendum in 2014 is being led by Alastair Darling, the former Labour Party chancellor of The Exchequer.

The last British prime minister, Gordon Brown, represented a Scottish constituency,

One possible compromise solution, termed “DEVOMAX,” or maximum devolution — which might satisfy all but the most ardent nationalist — would be for greater powers to be devolved to the Scottish Parliament, although it would not be easy to decide on which powers to devolve especially in economic policy.

The Scots are a canny lot of people and it would be unwise to conclude at this stage that they, including the 16-year-old youths who are being accorded votes in this referendum, will opt for “glorious independence.”

Even if they do, this would not of course mean the end of Scottish influence in the rump of the U.K. It would be hard to find a British company or organization without a good proportion of people of Scottish origin in responsible positions.

Hugh Cortazzi served as Britain’s ambassador to Japan from 1980-1984.

  • 808Townie

    Excellent article offering this US citizen, who follows the ebb and flow of UK politics, an improved understanding to the question of Scottish independence. Have had some “lively” discussions in the recent past, and Mr. Cortazzi’s expertise is a welcome insight.