Scotland after the Referendum: “It was business as usual that got us into this position in the first place”

October’s seminar at the Constitution Unit entitled The Day After Judgement: Scotland and the UK after the Referendum responded to the vote on independence held in Scotland on 18 September. Professor Jim Gallagher and Professor Iain McLean discussed the future of the UK Union and the devolution of power from Westminster to Holyrood. Julian Payne reports.

At the Scottish independence referendum on 18 September more than 55% of Scots voted in favour of remaining in the United Kingdom. Last week, at the latest Constitution Unit seminar, the repercussions of this decision were discussed by Professor Jim Gallagher and Professor Iain McLean, both distinguished academics with extensive experience in devolution. The speakers emphasised that following the referendum it would be wrong to assume that we can revert to ‘business as usual’. Instead, what is required is a system of devolution for Scotland that is in line with the Union that was defended in the referendum.

The question of a referendum was first raised in 2007 when the Scottish National Party (SNP) formed a minority government in Scotland. Polling data going back to 1999 suggested that an independence referendum was never going to yield a majority yes vote. Why did the SNP say they wanted a referendum when the Scottish Parliament did not have the legal power to hold one and data suggested they were going to lose anyway? According to Prof. McLean, the insistence on a referendum for Scottish independence can be attributed to ‘cheap talk’ – it cost nothing to say and it would be voted down in the Scottish Parliament anyway. However, the election of an SNP majority administration in Edinburgh in 2011 and the promise of a referendum in the SNP manifesto meant that there was no turning back.

In the months leading up to the referendum the Scottish population saw the question of independence as being largely an economic one. However, Prof. McLean suggested that arguments purporting that an independent Scotland would have been better off economically amounted to what he termed ‘fiscal fantasy’. That is to say that pro-independence arguments based on economic benefits, such as those promising greater gains through North Sea-oil revenues, were misguided. Prof. McLean went on to show that, under independence, Scotland would most likely have faced a tighter fiscal squeeze and would have had to implement austerity measures. The swap that an independent Scotland would have made in terms of oil receipts for the block grant under the Barnett formula and social protection transfers would have made little difference either way. In effect, some years Scotland would have been better off under transfers and other years under oil. Further, Prof. McLean argued that greater fiscal autonomy for Scotland in the UK under the so called ‘vow’ and the retention of the Barnett formula are incompatible; an increase in one necessarily entails a decrease in the other.

The referendum was a choice for two different Scottish futures and Scotland has chosen to remain in the UK. Nonetheless, a vote for the UK is still a vote for change, in terms of greater devolution from Westminster to Holyrood. Under the Scotland Act 2012, the next Scottish Parliament will set its own income tax rate. Now, following the vow, talks on further devolution are being undertaken by the Smith Commission to which main parties have submitted proposals for extending further powers to Scotland. So, further change is inevitable. However, Prof. Gallagher argued that any change must be consistent with the type of Union that was defended in the referendum. First and foremost, this means that the UK is a political Union and a multinational state. It is also an economic Union that encompasses fiscal sharing, and entails social solidarity concerning pensions, welfare, and public services.

Both speakers emphasised that it is time to reconstitute the territorial nature of the UK. Though a territorial constitution is something the UK has always had, it has never been properly acknowledged and given explicit legal form. In a paper accompanying the seminar, Prof. Gallagher argued that such a constitution must do two things. First, it must acknowledge that the UK Union is a voluntary one in which the devolution of institutions play a permanent role. And second, such a constitution must reflect the reality that England has a constitutional existence too, which is likely to be expressed in parliamentary procedures to deal with English legislation.

Watch Jim Gallagher and Iain McLean‘s full presentations on our Vimeo page.

About the Author

Julian Payne is a current intern at the Constitution Unit, working on Meg Russell’s Parliament Project. He recently completed an MSc in Comparative Politics at the London School of Economics.

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