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Brian Monteith

It came as no surprise to me that Alistair Darling trounced Alex Salmond in the first independence debate. Much as it pains me to defend a former Labour Chancellor, who in many respects only managed to look good because he was not Gordon Brown, it always seemed to me his lawyerly attention to detail would be the natural antidote to Salmond’s bluff and bluster.

And so it proved.

With this referendum column being fortnightly I though I should turn to what might happen the next time the two combatants meet, on 25th August. Obviously Darling will be hoping to land a knockout blow, or at least win on points giving him two out of the three debates, while Salmond will be hoping to reverse his loss and set up a grand finale. All the pressure will be on the First Minister as he tries to regain lost ground – but until he has an answer for what his Plan B on the currency issue is it is hard to see how he can do this.

The question of the currency now looms large in the debate, and is not as abstract as some nationalist supporters would wish it to be. As Scots Tory MSP Murdo Fraser put it, people want to know in what currency they will be paid, in what currency they will pay their mortgage and with what currency they will buy their groceries. Those are all fairly basic – and vital – questions.

It is also finally beginning to dawn on many of those Scots that doubted the refusal of the Unionist parties to contemplate a formal currency union between an independent Scotland and the continuing-UK that they are not bluffing. With all the parties now willing to go to the length of putting a commitment to exclude currency union in next year’s general election manifestos there would be too much loss of face and political discontent to go back on that pledge.

Nevertheless, for Darling to win the second debate he cannot stand still and go over all the same ground – although he can make the occasional jab by asking if Salmond has come up with a Plan B yet. What is needed is for him to move on to new territory, and while there are some fairly obvious issues that the First Minister and his advisers might anticipate, they are not any easier to deal with if answers there are none.

Take the European Union. The SNP has made a real dogs breakfast of the issue – three things stand out, firstly Alex Salmond saying (in an interview with Andrew Neil) that he had legal advice on Scotland’s membership of the EU, which after FOI requests was found to have not existed at all. This was after the Scottish Government had spent money trying to deny the FOI requests in court! Simply stating the chronological facts of the story and then asking why the First Minister behaved in such a deceptive manner would be enough.

Secondly there is the question of what the new terms of membership would be – including the loss of Margaret Thatcher’s rebate and all the existing opt-outs and deregations. This of course leads to the higher cost that will be faced on VAT (fewer exclusions etc) and then what the SNP would have to give up to ease the membership process. The nationalists really have no answer to these points.

Thirdly there is the issue of the SNP denying any possibility of an EU membership referendum after such negotiations have concluded – which is highly hypocritical. The SNP believes it is necessary to have a referendum on the Union with the home nations but not have one on the Union with the European nations. It’s absurd and with 33 per cent of Scots against EU membership it is worth raising.

Beyond the EU the other potentially embarrassing issue is the economy. This week Scottish economist Ewen Stewart published a new study for the pro-union Scottish Research Society called “Much cost, little benefit” which has a truly devastating analysis.

Stewart explains how an independent Scotland, dependent on a highly cyclical oil sector, cannot maintain its public spending at £1,267 a head higher than the UK and over 50 per cent of GDP. An independent Scotland would have to cut spending, raise taxes or a combination of both. The nationalists like to talk about independence bringing an end to austerity but Stewart’s figures suggest that to deal with the looming deficits it would be far worse. In 2012/13, an independent Scotland’s deficit would have been up to £17.1billion, or £3,226 per head. An independent Scotland would be liable for a national debt of £116 billion (from which the SNP finance secretary still threatens to walk away), rising to £186 billion when including bank liabilities.

With the assets of Scottish banks 12 times the country’s GDP – dwarfing those of Iceland and Ireland in 2008 when the banking crash came – such a scenario would have bankrupted Scotland had it been independent at that time. Without the support of the Bank of England, Scottish banks would be forced to migrate to London or shrink their balance sheets. Neither prospect is good for Scottish jobs – and completely contradicts the SNP’s outrageous promise of 200,000 new jobs.

Nationalists like to say that independence would bring an end to food banks – but they would be the only banks blossoming in Scotland’s austere economy – just as the rest of the UK is looking to continue its economic growth.

In the first debate Alex Salmond tried to embarrass Alistair Darling by reading past quotes of the Labour politician from newspapers – little realising he has many hostages to fortune himself – on the currency (the pound being a millstone for Scotland); the EU (on membership) and world affairs (on Putin) to name just three. There is still some way to go in this referendum campaign but it is Alex Salmond that is now looking the weaker of the protagonists and his personal campaigning style of fatuous one-liners now looks likely to blow up in his face.

Salmond has become the nationalist’s biggest liability and the recriminations from the Yes campaign are already starting – offering the prospect of a new First Minister before Christmas.

4 comments for: Brian Monteith: How Darling can win the next debate with Salmond

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