Scotland and Brexit

A conference organised by the Centre for Constitutional Change – 19 September 2016.

The Conference was divided into four sessions:

• Panel of MSPs from the Scottish Government’s European and External Relations Committee
• Academic Panel: What does ‘Brexit means Brexit’ actually mean
• Academic Panel: Brexit, devolution and Scotland’s Constitutional Future
• Meetings message to the European and External Relations Committee.

The conference was chaired by Henry McLeish

The Panel of MSPs were Joan McAlpine (committee convenor), Lewis MacDonald, Jackson Carlaw, Ross Greer and Tavish Scott.

JMcA frankly admitted that the Committee were unclear as to the role that Scotland has in the Brexit negotiations. Scotland needs to target a different relationship that would maximise the benefit to Scotland but how.  As to the arrangement of the UK to the external world, the WTO may be at least the short term option.

All agreed that the maintaining the Single Market should be a priority but, other than JC, they expressed the view that the UK still didn’t appear to have yet any Brexit strategy.

RG stressed that freedom of movement is economic rather than political. He believes that it is time to get young people involved.

TS made the point that the UK Government was shaken to the core by Brexit. He pointed out that there is a lot happening in Europe over the next couple of years that have nothing to do with the UK and Brexit: Elections in Austria, Hungary, Germany; nevertheless Brexit will have bad economic consequences for both the UK and Scotland.

In questions, members of the Committee felt that Brexit negotiations would still be going on well into 2019; all agreed that ‘it was all going to be very messy’ but the ‘Single Market’ may be some sort of a red line. The obvious question came up as to whether there would be a 2^nd Indy referendum by then but the Panel gave no clear answer other than the general feeling that a 2^nd Indy referendum is ‘on the back burner’.

The Academic panel: What does ‘Brexit means Brexit’ actually mean were Laura Cram, David Bell, Christina Boswell and Michael Keating.

LC felt that we are in turbulent times and everything is up for grabs so let’s make the best of it and be creative. She saw the EU, now 27 members, in Bratislava as symbolic: see the Bratislava Declaration and Road Map.

DB equates the Single Market with Free movement – this is an impasse but he noted that there are lots of different positions in Europe. He was critical of the Norwegian situation as ‘uncomfortable’, the EU is unhappy with Switzerland and Canada (along with its Quebec aspect) is too different for a UK solution. He sees the devil in the detail: specific items like steel, public procurement, customs, rules for business support and how to resolve disputes. He is not keen on TTIP as it is in his view, undemocratic.

CB concentrated on immigration a ‘7 year stop’ might be proposed but unlikely to be political acceptable. In any case if the UK leaves the Single Market it is unlikely to halt immigration at least for business reasons. So far targets for non-EU states have failed. The only way to reduce immigration is to remove the need for labour migration, which implies a weaker economy.

MK made some basic statements. One needs to separate political union from economic union; sub-state governments cannot be members of the EU; no half way house ; No ‘Reverse Greenland’ with Scotland and Northern Ireland taking decisions for England and Wales – not going to happen. England is suffering from an identity crisis. A number of matters will revert to Scotland, those not ‘Reserved’, so Scotland has the opportunity to work with EU on these matters – move in parallel with the EU. Focus on specific businesses.

• The EU is market based – it is not political
• The UK will no longer be for China a platform to Europe.
• Globalisation is a root of discontent, but ‘sovereignty’ is overstated; however Europe hasn’t connected with ‘nationalism’. There is pressure to ‘go back to basics’.
• Instead of focusing on the ‘Single Market’, look to the wider issues; what kind of union do we want – a social union featuring welfare? There are many different reasons for joining with the 27 and do any they apply to Scotland?
• It is unclear how Article 50 negotiations will proceed; Brexit means that the UK position is weak and getting weaker as time goes on with the EU losing patience, bearing mined all their other major issues.

The Academic Panel: Brexit, devolution and Scotland’s Constitutional Future were David Heald, Alan Page, Ailsa Henderson and Nicola McEwen.

DH was unclear on the effect of Brexit on Barnett; will the UK position with more or less austerity and more or less regulation; finance will be hit if non-passporting; migration has a differential effect; there could be more focus on England. Would the UK Government replace EU subsidies on agriculture and university research and if so where will the cash come from. What effect will there be on VAT which is euro regulated. Scotland has a very small income tax base, 9% Tax payers provide 50% of Corporation Tax and is therefore vulnerable.

AP, a lawyer, considered that Brexit has huge implications; the distribution of powers will remain but will require law making which currently rests with the EU; EU law in Scotland would cease to apply; there is the prospect of divergence within the UK, leading to the possibility of Devolution being re-examined.  Removal of EU restrictions may be significant. Acts of the Scottish Parliament no longer open to challenge.

AH was concerned with attitude to risk and research had shown an imbalance in the general and specific risks. In comparison to the long campaign up to 2014, the 2016 referendum was short; there was no white paper and only limited engagement; no losers assent (cf Independence Referendum) . What are the options even now to make it better?

NMcE felt that we need to look again at the Devolution Settlement eg employment law – the SNP want EU social protection but this would lead to ideological divergence and increased tension. Scotland needs more workers. Scotland needs to be free to do deals. She recognises that by taking Independence off the table, Scotland’s negotiating position is weakened (Remember May’s comment re- guaranteeing EU members the right to remain in the UK). Northern Ireland is a special case.

To Questions: border agreements important for both Scotland and Northern Ireland but different. The UK government will just impose its will; Scotland is unlikely to have a say. The UK regards tax rush to the bottom ‘as policy’ which will have a bad effect on Scotland and Northern Ireland. The importance of agriculture is recognised but not obvious ‘the money is where the mouth is’

Meetings message to the European and External Relations Committee

NMcE asked groups of the audience to write down what they believed the European and External Relations Committee should review and take forward. A few groups presented their views and all groups’ inputs were collected.

Henry McLeish summed up. He also expressed a personal view that the Tory Party had taken the Country into the Referendum merely to tackle its internal issues without any consideration as to the consequences for the Country as a whole.

Where to now – my view

Taking Laura Cram’s thesis: everything is up for grabs, a thesis supported by Michael Keating and we should ‘think out of the box’; what does Scotland want by continuing with the 27 and how should it establish the right workable political as well as economic structures to do so. We can only hope that the Scottish Government is now working away in the background to come up with such structures (is this the role of Nicola Sturgeon’s special group headed by Prof Drew Scott?). Unfortunately this is not obvious from the points made by the members of the European and External Relations Committee at the meeting, who seemed generally defensive and focussed on ‘we don’t know what the UK will do re Brexit’.