Scottish Independence

On the 18th September 2014, Scotland will make a historic decision as to whether it should become an independent nation or remain in union with the United Kingdom. The pro-independence parties, Scottish National Party (SNP) and the Scottish Green Party, have joined forces to create the movement Yes Scotland. Scottish Labour, Scottish Conservatives and Scottish Liberal Democrats have joined together to create the pro-unionist group Better Together.

The issue that the people of Scotland have it is very difficult to get a good understanding of the situation because a lot of campaigning by both groups is mostly political propaganda. There are benefits to independence and there are also positive aspects of unionism. All of which must be carefully considered in order to have a balanced well-informed vote. The following essay will attempt to give a clear and balanced account of the Scottish independence and will give an indication as to whether Scotland should or should not be an independent country.

The main advantage of Scotland achieving independence is that it would have full control of governance. As an independent nation, Scotland would be able to set its own laws and regulations and would no longer need to abide by any rules set by Westminster. Scotland could run and regulate more locally and would create policies that are better suited for the local population e.g. set a fairer, more varied rate of tax so that richer families pay more tax than that of poorer families. It can be argued that Scotland can serve Scotland better than a far away Westminster government can as Westminster must act in accordance of the people of the UK as a whole instead of to Scotland specifically. With full control over its budget, Scotland would be able to invest in areas that are important to Scotland such as health, welfare and education. Another industry that could flourish in an independent Scotland is renewable energy as Scotland has a large amount of off-shore wind farm opportunity as well as an abundance of rain that can be used for hydroelectric power. To put this into perspective, it is estimated that Scotland has 25% of the tidal energy potential in all of Europe. Scotland also has large exports of food and drink, whisky and fresh water which can be used for Scotland’s benefit. One counter argument is that Scotland is inexperienced in governance and that expensive mistakes can occur such as the debacle with Edinburgh trams, which went twice over its original budget and was 3 years over schedule. Another example of inexperience was when the Scottish transport minister, Stewart Stevenson, had to resign when the country ground to a halt due to his poor handling of the winter storms of 2010. Overall, Scotland must decide if it is ready to govern its own affairs and whether it would be better off independent. If it is decided that Scotland is not fully prepared, then alternatives to independence must be found.

Another option that would be a positive change in the way in which Scotland is governed is to grant more power to a devolved Scottish Parliament within the United Kingdom. The setup of having a devolved parliament allows Scotland to be able to run and regulate key areas of governance such as health, education and transport whilst the United Kingdom Government operates other areas such as national security, foreign policy and immigration on Scotland’s behalf. The devolved sectors are controlled by the Scottish Government and the UK Government has no control over these sectors and vice versa. Since the creation of the Scottish Parliament in 1999. Scotland has been able to make its own laws such as the implementation of the smoking ban in 2006. Scotland has been able to create its own government agencies such as the Scottish Qualification Authority, Visit Scotland and Creative Scotland amongst others. In the event of Scotland voting against independence, plan from the Labour party would grant the Scottish Parliament more powers in the area of taxation by allowing the variation of income tax. Labour has also backed more social justice for Scotland by introducing a lower 10p tax threshold for lower earners as well as a ban of zero-hour contracts. It could be argued that Scotland can get the power that it requires to be more self-governing whilst being part of the union and that independence may not be necessary. The other aspect of devolution is that it allows Scotland to be given more power over time and it allows the Scottish parliament’s ability to govern to be progressively improved by gaining experience of governance in a wider scale. On the other hand, devolution can be criticised for being too slow and that Scotland can only gain the powers that it requires quickly by becoming independent. To summarise, the people of Scotland must decide whether it should continue on the devolution trail where Scotland is given more power over time. The alternative option is to become independent and receive all the power immediately and hope that the Scottish Government can operate effectively despite its inexperience.

One reason for leaving the union is that Scotland often pays taxpayer’s  money towards large projects that it gets no benefit from. Every year, Scotland sends tax revenue to the UK Treasury, from which the Westminster Government allocates funds to certain areas in the annual budget. It can be claimed a lot of Scottish people feel aggrieved by the UK Government spending billions of pounds on projects that do not effect the people of Scotland. For example, the £42 billion spent on the HS2 London to Birmingham high speed rail link and the £16 billion renovation of the London underground. For the SNP, this is a commonly voiced issue that Scotland pays more to the UK Government than what the UK Government sends back to Scotland in return. The SNP argue that only with independence, will Scotland receive the adequate funding required to enhance the nation. It can be argued that the SNP’s view is misguided as Scotland only makes up 5 million of the 63 million residents, so it logically makes sense for the UK Government to allocate more funding to areas where it affects the most people. However, it cannot be disputed that Scotland receives a high level of government investment. For example, £500 million investment in Glasgow, which was announced in July 2014. Another example is the £48 million investment into the Scottish renewable energy sector. On average, Scotland has £1,300 in public spending per person than the rest of the UK. Overall, Scotland must look at the situation and decide whether it is better off having a smaller size of a large UK budget or the entirety of a smaller independent Scotland budget.

… because Scotland would no longer be entitled to the use of these services if it chooses to leave the UK. The cost of the creation of the government bodies was estimated by the Scottish government to be around £200 million. One issue with this estimate is that the HM Treasury to the UK government calculated the costs of setting up the government bodies in Scotland to be £2.7 billion. This indicates the Scottish government is attempting to downplay the true cost of independence. Another issue with the cost is that Scotland is not gaining anything new despite the large financial outlay. Scotland would pay a large amount of money, not for a new government body, but a like for like replacement of what we already have in the UK today. In retrospect, an independent Scotland would be faced with massive bills to pay after creating new government agencies that it already has access to and this is true regardless of which estimate is correct.

A good example of how Scotland could be better off independent is the claim that Scotland would ban nuclear weapons as part of a written constitution. Faslane, on the River Clyde and 39 miles away from Glasgow, is home to the United Kingdom’s nuclear submarine fleet. The UK Government say that the reason for having such weapons is to act as a deterrent against a future invasion by a foreign nation. The UK spends over £2 billion on the nuclear arsenal per year, despite the majority of the public being against their existence. To add salt to the wounds, the UK Labour Government announced a plan in 2007 that would cost between £15 billion to £20 billion to replace the existing fleet with a more modern version. Pacifists will argue that it is offensive to have weapons of mass destruction within 40 miles of Scotland’s most populous city. On the other side of the coin, supporters of nuclear weapons argue that it supports over 6,500 jobs and removing the base would effect the area with large-scale unemployment. Also, it would cost the UK taxpayer around £25 billion to move or destroy the nuclear arsenal. Overall, it is clear that there are arguments for and against having nuclear weapons at Faslane. It would be worth considering the likelihood of a foreign nation invading Scotland with the nuclear-armed United Kingdom in such close proximity. Another area that would be worth considering is that an independent Scotland would not have to pay maintenance money toward the Trident, if it decided to remove it; therefore any money saved could be used to help ease the unemployment caused by its removal.

One of the major reasons for Scotland to remain in the United Kingdom is to retain use of the currency, Pound Sterling. The United Kingdom has used Pound Sterling as its currency for over 300 years. During that time, it has been strong, stable and reliable. It has allowed Scotland to have a strong centre point to its economy and has allowed the country to be attractive to foreign investment. The SNP has said that an independent Scotland the use of the Pound Sterling in the form of a currency union with the rUK. On the contrary, the UK Government has said that Scotland will not be allowed to use the Pound Sterling as part of a currency union. The reason that the UK is not in favour of a currency union is because it requires a banking union and a fiscal union. So far, the SNP are not in favour of a fiscal union or a banking union because it would mean the currency would have interest rates controlled by the Bank of England in a foreign country. The SNP have threatened to renege on Scotland’s share of the UK’s national debt if it is not offered a currency union. Such policy would show the world that Scotland does not honour its debts, meaning its credit rating would drop and getting loans would become much more difficult. To summarise, Scotland would need to choose from one of the following options. Scotland would have a currency union with the UK where a foreign country would have control of the currency. On the other hand, Scotland could join the European Union and use the Euro, which has proved very problematic for other smaller countries such as Greece and Portugal. It also requires EU membership, which is not guaranteed for Scotland. Finally, Scotland could created its own “Scottish Pound”, which would be risky as it is an untested currency and would also need the creation of financial institutions such as a new central bank. Alternatively, Scotland can stay in the UK and have the security and the stability that it currently has part of union, instead of facing the risks and uncertainty that independence would bring.

One of the issues with remaining in the UK is that Scotland has to partake in foreign wars that Scotland is not effected by. Currently, Scotland has its share of the British army fighting in foreign countries such as Iraq and Afghanistan. In the context of a small independent nation, Scotland would no longer be at the forefront of preserving world peace like it is just now as part of the United Kingdom. It can therefore be argue that Scotland can make large cutbacks in military expenditure by not having any involvement in these wars that serve no benefit to Scotland. As a result of these cutbacks, the money saved can be spent on other areas such as health, education and welfare. On the other hand, a nation with a reduction of military expenditure and plans to scrap its nuclear deterrent can create problems of its own. To elaborate, some may question the wisdom of leaving the people of Scotland with very little means of defending themselves, should they be faced with the prospect of an invasion in the future. To conclude, the people of Scotland must consider whether the current level of military expenditure can be justified or not. Should the decision be that it is not justifiable, the consequences of military reduction should be carefully considered as well.

Scotland as an independent nation would face many challenges. One of which is the economic uncertainty that independence could bring. For example, one major issue with the Scottish economy is that it is over-reliant on the banking sector. To put this into context, Scotland has banking assets, from Clydesdale Bank, Halifax Bank of Scotland and Royal Bank of Scotland, that are 12 times that size of its GDP. On the other hand, Iceland had banking assets that are 10 times the size of its GDP at the time of the banking crisis of 2008. To look at the financial devastation that Iceland went through, it is unimaginable to consider the fate of a vulnerable independent Scotland in such a volatile economic environment. In 2008, the UK taxpayer and the American Federal Bank bailed out the Scottish banks HBOS and RBS to the tune of £468 billion, saving the banks and all their customers from bankruptcy. Scotland received this backing as part of the union, however, it would be a very different situation if Scotland was independent. It could be claimed that Scotland would not be bailed out by the UK taxpayer as Scotland would then be a foreign country. In addition, the American Federal Bank may not bailed out Scotland as it is a less important military and economic partner to the USA compared to the United Kingdom as a whole. It can therefore be argued that an independent Scotland would be a nation with very little financial protection and be very vulnerable to another economic crash. Overall, Scotland must decide whether to stay in the union and have financial security or become independent without the help from any other nation.

In conclusion, it is clear than when deciding to vote for or against independence, it is a very difficult decision to make. There are clear arguments for independence that would bring benefit to Sc0tland and there also aspects of staying in the United Kingdom from which Scotland benefits from. However, it is of particular concern that, in the events of independence, Scotland will have a very inexperienced government with full decision making power, in conjunction with high levels of public debt and a loss of financial security that being In the UK provides. Scotland may well have a ban on nuclear weapons and have full control of governance but these factors mean very little in the event of another economic meltdown. It can be argued that the economic uncertainty makes all other factors relatively insignificant. By the staying in the union, Scotland can have the best of both worlds by having the stability of the union and continuing the use of Pound Sterling and feel safe within the protection of the British Army. Scotland can also press on with plans of further devolution where the Scottish Parliament is given more power on key areas that matter to the people of Scotland such as taxation and welfare. Taking all of this into consideration, Scotland should not become an independent nation and should stay In a union with the rest if the United Kingdom.