The wages of Scottish independence – membership of the EU

The Scottish Numpty Party (SNP) leader Alex Salmond has a dream; well, more of an adolescent  fantasy really. He imagines that an independent  Scotland  would  immediately be embraced enthusiastically by the EU. In the more heroically bonkers versions of the fantasy, Scotland never leaves the EU because it is, in the SNP  mind, already an independent  member. Take the example of  Jim Mather, the SNP economics spokesman,  commenting on  the position of an independent Scotland in the EU : “Of course it will be seamless. It’s not in the EU’s interests to do otherwise. We are an incumbent member state, what about England having to reapply?” (http://thescotsman.scotsman.com/politics/Doubts-over-automatic-EU-entry.3335953.jp).  Once ensconced within the EU as an “independent”  member, the SNP believes  that Scotland  will  be able to tap the EU for vast subsidies in the manner  of the Republic of Ireland over the past decades .

This fantasy  of a  fast or even automatic  EU membership for an independent Scotland was rudely deflated  in January 2007 by the European Commission’s  representative in
Scotland, Neil Mitchison, who stated  that if Scotland seceded from the UK  the situation would be “ unprecedented and therefore negotiations would be needed. Things would have to be discussed and negotiated,” he said.   (http://thescotsman.scotsman.com/politics/Doubts-over-automatic-EU-entry.3335953.jp).

A reader in international law at Hull University Matthew Happold  had previously examined the issue in 1999  for the British Institute of International and Comparative Law. He  concluded : “Scotland’s subsequent route to EU membership could well be a tortuous one. The SNP’s use of the phrase ‘Independence in Europe’  seeks to persuade the Scottish electorate that it can have its cake and eat  it, that Scotland can have both the benefits of independence and the security of membership of the European Union.

“However, the real situation is that an independent Scotland might end up with all the insecurities of independence and none of the benefits of EU membership.” (ibid)

Lorand Bartels, a lecturer in international economic law at Edinburgh University has no doubt that there would be no automatic Scottish membership of the EU:  “Both as a matter of international law and as a matter of EU law, Scotland would have to negotiate its accession to the EU as a new member state.

This process may be relatively unproblematic, given that Scotland already applies EU law, but it is unlikely to be entirely ‘seamless’. At the very least there would be likely to be an obligation to adopt the euro.” (ibid)

The agreement of  each individual EU state would be necessary for Scotland’s  membership.  In some instances national referenda might be required, for example, the Republic of Ireland and France.  In other countries, in the midst of the mess the EU elites have produced with their madcap scheme of the Euro, those elites might now be much more willing to allow referenda, especially on issues which were not  fundamental to the future of the EU, in an attempt to appease their electorates.    It would also be an interesting test of the UK Coalition Government’s proposed legislation to refer any major decision relating to the EU to a referendum.  The UK electorate might well vote NO if given the chance.

On the likely circumstances of a Scottish application alone it is uncertain that an independent Scotland would be received into the EU rapidly or even  at all.  The remainder of the UK (henceforth the UK) could reasonably object to Scotland’s membership on a number of powerful grounds. The first would be the likelihood of  an independent Scotland  acting as a conduit for immigrants from outside the EU coming to England.  The second would be the strong possibility that there would be a much greater  flow of Scots nationals to the UK than UK nationals to Scotland because of the greater opportunities for work and superior benefits in the UK, benefits which would have to be extended to any EU national,  including Scots nationals, coming to the UK  A third  objection  would be the strong possibility that Scotland would take more out of the EU than it put in. Scotland would lose heavily with independence through the withdrawal of the preferential  UK Treasury funding of Scotland (currently worth £8 billion pa just on the difference in per capita Treasury funding between England and Scotland –http://scotlandonsunday.scotsman.com/uk/Treasury-to-scrap-20bn-subsidy.3300384.jp) , the return of English jobs to England, and the additional costs involved in having its own armed forces, diplomatic service and suchlike.  These changes would far outweigh any benefit Scotland would enjoy from the tax derived from the oil in Scots waters (http://www.scotlandoffice.gov.uk/scotlandoffice/files/Scotland%20and%20Oil%20-%20Background%20paper.pdf)

If the UK did not object the EU would have good reason to. It is a little difficult to see why the those on the continent who act as the paymasters of the EU would be willing to pay more to Brussels, while the existing EU beneficiaries will not welcome a new competitor for the existing subsidy funds.   A significantly poorer post-independence Scotland  would have a greater claim on EU Structural Funding  than it does within the UK.  That would make Scottish membership even less attractive to EU members generally.

As for access to greater subsidies as an independent EU member, this aim rather undermines the SNP claim that Scotland is fitted to be an independent nation state.  But it is  dubious whether much  largesse will be forthcoming  because circumstances have changed greatly over the past ten years. Scotland has been a major beneficiary of EU Structural Funds (  http://www.europe.org.uk/index/-/id/90/)  since they were established in 1975.  Between 1994-2006 the country received £2.43 billion  (http://tinyurl.com/63ho8sb).  As new members, all of them poor,  have joined the EU  the amount of structural fund money  going to Scotland has dropped dramatically – it virtually halved for the period 2007-13 compared with 2000-2006 (see para 1 http://www.eprc.strath.ac.uk/eprc/documents/PDF_files/Scotland%20Europa.pdf ) and will probably reduce substantially again  in  the period after 2013 because of the demands of the poorer members; new EU entrants who will all be poor;  the growing reluctance of the richer EU states to hand out money to the poorer and, in the worst case scenario, a serious economic depression in the EU caused by problems with the Euro, either in sustaining it or dealing with the aftermath of its partial or total failure.

There is another fly in ointment. Most of the  EU Structural Fund money has to be met with a matching amount from the recipient EU state. At present anything Scotland gets by way of such funding is matched by money from the UK Treasury, most of which, arguably all, comes from English taxpayers because England is the only one of the four home countries to take less out of the UK Treasury pot than she puts in.  If Scotland were independent she would have to match any funding from her own resources.  Ironically, if the SNP got their wish Scotland would get much less out of the EU than she does now.

That leaves the Euro. Whether it will exist by the time an independent  Scotland made  a bid for EU membership is moot. However, assuming it does exist it will be unlikely to welcome into the Euro fold a Scotland massively burdened with their share of the UK national debt and other items such as Scottish PFI burdens and with an economy dangerous dependent on public service employment  and a very narrow private enterprise base .  The Euro does not need  another Republic of Ireland or  Greece.   If the Euro is dramatically changed when Scotland apply to join the EU, for example,  the Euro restricted to a small group of northern European countries,  it is improbable that Scotland would be allowed to join. That would throw them back on the choice of retaining the pound (which would take much fiscal control out of their hands) or floating a new currency, something very difficult for a small country, especially one which has not had its own currency for three centuries.

Those who look upon the Euro as an albatross around the neck  of most  Euro members because of the absurd  one-size-fits-all  Euro economies  policy of the ECB, might think that Scotland would be well out of the currency. But if  Scotland was within the Euro it would have one massive advantage in the SNP’s eyes: they believe that if Scotland ran into real financial trouble they would be bailed out by the other Euro members .  After the present turmoil it is very unlikely that would be the case for the foreseeable future, but sadly for Scotland  the SNP still believe it is sound reasoning.

The SNP’s worst case scenario would be for the EU to collapse completely, something not wildly improbable. If a large EU country like Spain or Italy  were to  default on private and sovereign  debt  the Euro could vanish  (and it might  go if Greece, Portugal and the Republic of Ireland defaulted).  This could  cause such economic distress and political anger amongst EU electorates that national politicians would desert the EU and revert to supporting their nations states  in an effort to save themselves.  Then Scotland would be brought face to face with the reality of her position: she is dependent on England for her  economic well-being and safety.  Those living north of the Tweed might find they got a dusty response if they  asked for English help in such circumstances.

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6 Responses to The wages of Scottish independence – membership of the EU

  1. efgdefgd says:

    Thank you once again for an informed and well thought-out article. I wish there were more pragmatic people out there.

    • Thanks. The prime difficulty with the subject is that neither the SNP nor Westminister politicians will look honestly at the implications, economic, political and social of Scottish independence. Worse, probably few, especially those at Westminster, will have even tried to master the detail of what is a very complex matter. In all probability they will sleepwalk to disaster, blissfully ignorant until the awful reality cannot be ignored.

      The truth of the matter is that even if Scotland were to be nominally indpendent, come economic disaster it would be England who would be called upon to bail them out, just as we were called upon to support the Republic of Ireland.

      • Chris says:

        Nonsense, England on its own will be FAR TOO POOR to bail out Scotland or anybody else for that matter, so worry not.

  2. Pingback: The complete “Wages of Scottish independence” | England calling

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  4. Pingback: The complete “The wages of Scottish Independence” « Living In A Madhouse

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