Monthly Archives: January 2013

Scottish independence referendum: issues and the federal alternative

Independence – On 15 October 2012, UK prime minister David Cameron and Scotland’s first minister Alex Salmond signed what has been called the ‘Edinburgh agreement’ which provides that the Scottish people will vote in a referendum in the autumn of 2014 on whether Scotland becomes independent from the UK.

Agitation for home rule for Scotland over many decades eventually led to a referendum in 1979 for Scottish devolution which did not secure the required majority.  However, a referendum in 1997 was successful.  The UK Scotland Act of 1998 subsequently established the Scottish parliament and an executive government with power to legislate on devolved matters including health, education, justice, rural affairs and transport.  The UK parliament continues to be responsible for national policies, such as constitutional issues, UK foreign policy, UK defence and national security, fiscal and economic issues, immigration, energy (electricity, coal, gas and nuclear), common markets, trade and industry, railways, transport safety, employment and social security (www.scotland.gov.uk/About).

For UK prime minister David Cameron the referendum ‘marks the beginning of an important chapter in Scotland’s story and allows the real debate to begin’ in which he would ‘be making a very positive argument for our United Kingdom’ (Cameron, D. 2012, ‘PM signs deal with Scotland’s First Minister today granting Holyrood power to hold a  historic referendum on independence’, 15 October, http://www.number10.gov.uk/news/scottish-independence-referendum).

On 29 November 2012 MPs voted in the House of Commons 334 votes to 5 in favour of a motion for the retention of Scotland in the UK which included the statement that ‘Scotland is better off as part of the UK and the rest of the UK is better off together with Scotland’ (House of Commons, Hansard, 29 November, Column 445 at http://www.parliament.uk/business/publications/hansard/commons/by-date). Margaret Curran, Labour MP for Glasgow East told the House of Commons the Labour party ‘has been and always will be’ a ‘party of devolution’ but ‘we are not a party of separation’ and ‘we can achieve more together than we can apart’ (House of Commons, Hansard, 29 November column 436 (ibid). This was not the view of Scottish Nationalist MP Pete Wishart who said: ‘The political union has failed Scotland.  We no longer want to be tethered to a failing UK state, we can be better, we can walk tall in the world, we can make decisions on our own’ (BBC News 2012, ‘Scottish independence: MPs say Scotland “better off” in UK’, 29 November, http://www.bbc.co.uk/news/uk-scotland-politics-20544743).

The campaign will be hotly contested by those who want full independence and those who consider that Scotland will remain in the UK.

Independence for Scotland raises a number of issues such as:

. What will be the relationship between an independent Scotland and the British monarchy? The current Scottish Nationalist Party (SNP) First Minister has pledged that the Queen would remain head of state and Scotland would remain within the Commonwealth (Carrell, S. 2012 ‘Scottish independence: the essential guide’, 16 October, http://www.guardian.co.uk/politics/scottish-independence-essential-guide).  However, it is the policy of the SNP to hold a referendum of whether the monarchy should be retained.

.The issue of who would get the oil and gas in the North Sea would need to be resolved by negotiation with the UK government.

. Can Scotland function financially independent of UK government funding? As an example, would the Scottish government be able to fund Scottish universities at the current level of funding provided by the UK? Would it have the financial capacity to provide the full range of welfare and health benefits and services currently available? The options for an independent Scotland would be full fiscal autonomy or a form of economic union with the UK to provide funding for agreed programs and services.

. Could Scotland provide for its own defence?

. Currently Scotland is included in UK membership of the EU but would an independent Scotland be able to remain in the EU? According to the president of the European Commission, an independent Scotland would have to apply to join the EU according to the rules (BBC News 2012, ‘Scottish independence: EC’s Barroso says new states need “apply to join EU”‘, 10 December, http://www.bbc.co.uk/news/uk-scotland-scotland-politics-20664907).

A federal alternative – Those who support devolution but are opposed to independence argue that federalism is a better way to proceed.  The Scottish Liberal Democrats (SLD) party does not support independence.  It believes that home rule for Scotland can best be achieved within a reformed, federal UK: ‘Our approach is federalism, a system of government used across the world which allows for the expression of different identities within one system, but combines with it the additional influence and strength which comes from co-operation and common purpose.  We argue for distribution of powers among the nations of the United Kingdom, for joint action where that is necessary and effective, and for parliaments and assemblies across the United Kingdom to have substantial democratic choice and opportunity combined with the responsibility that comes from significant financial powers…It is now very clear that there are essentially two options: the breakup of the United Kingdom into its constituent units, or a modernised, federal United Kingdom’ (Sir Menzies Campbell, SLD MP, 2012, ‘Federalism: the best future for Scotland’, October, http://www.scotlibdems.org.uk/homerule).  The SLD propose ‘a strong Scotland within the United Kingdom’ with control over most domestic policies and responsibility for setting its own rates of income tax, with defence, foreign affairs and welfare remaining with the UK government (BBC News 2012, ‘Scottish independence: Lib Dems push federal UK plans’, 17 October, http://www.bbc.co.uk/news/uk-scotland-scotland-politics-19974690).

Wales and Northern Ireland could also be included in a federal arrangement.  Conservative Welsh Assembly MP, David Melding said all that was required was a ‘simple declaration that Britain is a federation with each of its parliaments indissoluble and sovereign over their appointed jurisdictions’ in which ‘Westminster’s sovereignty would be formally divided with  Britain’s other parliaments’ (cited in Torrance, D. 2012, ‘Independence, federalism and Sovereignty’, 17 April http://www.newsnetscotland.com/index.php/scottish-opinion/4794-independence-federalism-and-sovereignty).  A federal system enjoys some measure of cross-party support (Torrance, ibid).

The big issue in any federal arrangement is the distribution of powers between the two levels of government.  As we have seen in the Australian experience, it was the intention of the founding fathers that the Commonwealth should have limited and prescribed powers with the states having the rest, or residual, powers.  However, this distribution has been contested as power has become more centralized with the Commonwealth through decisions of the High Court and the financial strength and powers of the Commonwealth (see Chapter 4 of the textbook, pp 1170-118).

So how would a federal arrangement between the UK and Scotland function?  Carrell, op.cit) has outlined a range of options:

.’Devo-Max’ a term applied to ‘devolution max where Scotland would have complete control over taxation and political decisions, also known as full fiscal freedom, but remain within the UK, sharing services like defence and foreign affairs’.

.’Devo-plus’ where Scotland could control two-thirds of taxation and the welfare system in Scotland, but share pensions, foreign affairs, defence and monetary policy with the rest of the UK’.

.’Indy lite’ where Scotland would have total independence from England and its institutions’ and ‘Scotland would keep sterling, the Bank of England, the Queen, remain within the EU’ and ‘have a currency union with the rest of the UK and cooperate on defence’.

The devolution of some powers to the Scottish government while the UK maintains responsibility for the national issues fits within the parameters of the principles of federalism explained on page 95 of the textbook, because ‘sovereignty is divided between national and territorial governments’ with ‘each level of government retaining a degree of autonomy that gives it the powers to make laws in relation to certain policy areas’.  Powers have also been devolved to Wales and Northern Ireland which are constituent countries within  the UK.

The interesting question is whether this arrangement implies that a form of federalism already exists in the UK.  However, there is one significant element that suggests otherwise.  Other federations such as Australia, the USA, Germany and Malaysia whose federal arrangements are explained in Chapter 4 of the textbook each have a formal constitution establishing a federal form of government. There is no such formal federal agreement between the government of the UK and the territorial governments of Scotland, Wales and Northern Ireland.  Devolution was achieved by legislation of the UK parliament. The statement by Welsh MP David Melding cited above indicates that a formal declaration of federalism is required.

As we saw in Chapter 4 of the text book the problems experienced in managing issues such as defence and foreign affairs, trade and immigration on their own caused the Australian colonies to agree to establish a national government within the structure and organisation of a federal system, with the Commonwealth’s designated powers set out in the Australian Constitution of 1901. Arguments persist today about whether Australia should have a federal system and the preferred distribution of powers within the existing system.  For example, former Labor prime minister, Bob Hawke, recently ‘called for the abolition of states in the interest of achieving more effective government’ (cited in Branmston, T. 2013 ‘”Scrap states” to drive reform: Bob Hawke’ 1 January http://www.theaustralian.com.au/in-depth/cabinet-papers/scrap-states-to-drive-reform-bob-hawke/story-fngr9pxq-1226545907247). Professor Scott Prasser, on the other hand, responded in favour of retaining state governments on the basis that Australia is a big and diverse country and we ‘need a counterweight to “Canberra land”‘ (Prasser, S. 2013 interviewed on Radio 4BC, 1 January at http://www.4bc.com.au/blogs/4bc0-blog/abandon-states/20130101-2c3ik.html).

Whatever the outcome of the Scottish referendum the Australian experience suggests that arguments about the distribution of powers between the Scottish and UK government are likely to persist.

Gwynneth Singleton

4 January 2013

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