Toby Fenwick is a research associate at CentreForum.

The Scottish Independence referendum is something of a minefield. I don’t have a vote, but Lord Robertson-style hyperbole about a Scottish “cataclysm” is not just offensive and counterproductive – it is inaccurate, too. So my paper analysing Scottish independence published by CentreForum today makes it clear that Scotland is perfectly capable of becoming an independent country. But beyond my unionist instincts, it is clear that independence as proposed by the SNP would be worse for both Scotland and for the UK than remaining in a reformed union.

The SNP published the “Scotland’s Future” White Paper last November, which purported to be the most detailed plan for an independent country ever prepared. Beyond the hype, “Scotland’s Future” is a series of aspirations, and in the key areas of currency (and therefore monetary and fiscal policy), fiscal policy, national debt, banking and financial services regulation and EU membership, “Scotland’s Future” comes up short. Instead of a sober analysis of other countries’ interests, in the SNP’s world, everyone else will act in the way most favourable to Scotland, irrespective of their own interests. Why anyone would want to is never explained.

Worse, the SNP’s stock answer to inconvenient facts is that others are “bluffing”, “bullying” or simply out to do down Scotland. So, in the face of the unprecedented joint position of George Osborne, Danny Alexander and Ed Balls ruling out a currency union, Alex Salmond and Nicola Sturgeon continue to assert in the face of the evidence that the UK “will” accede to a currency union.

The SNP’s failure to provide a plan that can be implemented without favours from other states, and the SNP leadership’s refusal to address shortcomings in their planning (even when facts change) makes the already poor planning of “Scotland’s Future” undeliverable – and, with it, the SNP’s proposals untenable. If implemented, we assess that the SNP’s vision would by 2030 see a Scotland that is older and poorer, but potentially less unequal, than today.

Unimplementable policy is widespread in the “Yes” campaign. Listen to the Scottish Greens or the Radical Independence Campaign, and you could be forgiven for thinking that Scotland is on the threshold of being a Scandinavian social democratic utopia with “fair” taxes, and the holes filled with oil and renewable energy. Whilst this is easy to portray as an attractive picture of milk and honey, in the real world it simply can’t be delivered.

A No vote will be a vote against the SNP’s version of independence, rather than a vote for the status quo. But the status quo is changing, too. The 2012 Scotland Act transferred additional – if relatively minor – powers, as well as forcing Holyrood to set a Scottish tax rate, rather than merely the tax varying powers in the 1997 devolution design. These powers are limited, and all three UK parties are committed to devolving more powers and revenue control in the event of a No vote. As a Liberal, I endorse Ming Campbell’s report, on enhanced devolution within a federal UK.

Enhanced Scottish devolution makes English devolution inevitable. English votes on English laws would simply mirror the position in the devolved assemblies, and an elected upper house removes lingering problems of which peers qualify to vote on English legislation.

We therefore have a blueprint for a much more federal UK, with the federal government having powers over corporate taxation, national monetary policy, banking and currency supervision, defence and foreign affairs, national infrastructure and environment, but with all other powers – health, education, social care, local planning, arts – devolved. This provides the scale to share the risks at a UK level, and making government regionally responsible – as liberals have always argued.

Such a federal answer will probably fail to satisfy the more extreme partisans on either side. But federalism offers much in terms of a shared pooling of assets, talents and risks – the cocktail that has made the union so successful since 1707. If I had a vote, I’d vote No to independence, and Yes to those parties in 2015 which want to implement a federalised, devolved, UK.

Scottish Independence: a political and economic appraisal is available from Centre Forum.


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