A newly independent Scotland will have to work out many issues, not least its relationship with the EU. Unhelpfully, writes Sasha Vereker, the Yes camp has staked out a harsh negotiating stance with on the EU. It wants to retain all the advantages it currently enjoys as a member of the UK, such as the budget rebate, while renegotiating other aspects, such as the Common Fishing Policy.
The EU will see two independence referendums this autumn, in Scotland and in Catalonia. Parallels between them are made, and possible implications discussed. Spain, they say, fears that Scotland will set Catalonia a bad example, and so may block Scottish entry into the EU. However, the official Spanish position is that, since the Scottish referendum is legal and the Catalan one is not, there is no comparison between them. Rather than facing an outright veto, the problem of Scotland’s EU membership will be more subtle.
Every EU country has pragmatic reasons to ensure that Scottish membership of the EU is uninterrupted. These reasons are to do with continuity. Scottish citizens were EU citizens for over 40 years; Scotland contributes to the EU budget, shares the Common Agricultural Policy and Common Fishing Policy; it has workers from EU member states, and EU countries have Scots living and working on their territory. If Scottish EU membership were stopped, it would lead to considerable practical difficulties for all.
However, continuity arguments only go this far, and an easy entry for Scotland will set a precedent for want-away regions like Catalonia. Scottish membership of the EU might be in the other members’ interest, but accepting Scotland at any cost is not. Although Scotland has the potential to be a welcome member of the EU, Alex Salmond has set out a harsh negotiating stance on key issues:
- Scotland wants to keep the pound as its national currency. A move to the euro would be unpopular in light of the Eurozone crisis.
- The Schengen area countries (that is, all EU countries apart from the UK and Ireland) allow free movement of people across their territories. Scotland wants to opt out of this policy.
- An independent Scotland would want to renegotiate the Common Fishing Policy, which is bad news for Spain and other fishing countries, such as Denmark.
- Scotland wants to keep its part of the UK rebate, meaning that it would get back 66% of its contributions to the EU.
Whilst it is understandable that Scotland wants EU membership on favourable terms, it also has to bring something to the negotiating table. Alex Salmond outlined the main attractions in his speech in Bruges: contributions to the EU budget, fisheries, energy provision, and Scottish universities. Here I shall look at the first two, as well as trade, which is also an important factor for EU membership.
What Scotland offers
It is difficult to estimate Scottish contributions to the EU budget, but let us see how much it will contribute based on the assumptions made by the pro-independence campaign. Assume that Scotland will keep the rebate (which is unlikely), and that it will contribute the same amount as it did when it was part of the UK (although this is also unlikely). Scotland is expected to pay the EU £3.3bn over seven years from 2014-2020 if it remains in the UK. That’s around £160m per year after the rebate, which, using the 2011 figures, places Scotland 25th in terms of contributions, behind comparatively undeveloped new entrants, such as Romania and Bulgaria (the latter has population comparable to that of Scotland). Thus, if the pro-independence campaigners do not budge, Scotland’s contributions would not be tempting for the EU.
Access to Scottish fisheries is attractive, but the official position of the Yes campaign is that an independent Scotland would fight to keep more of the fisheries for itself.
Scotland’s trade with the EU is extensive, with 46% of Scottish international exports going into the EU member states. This figure will jump dramatically after independence, since the rest of the UK is Scotland’s major trading partner, and this trade is currently classified as internal. Obviously, trade is a mutually beneficial enterprise, but it is Scotland who makes money out of the EU, not vice versa, since it exports more than it imports, and 70% of Scottish businessmen say that any interruption to Scottish EU membership will affect them negatively.
A weak hand for bargaining
There is a huge disparity between what the independence campaign demands from the EU and what it currently offers. In summation, the Yes campaign wants to opt out of common policies (Schengen and the euro) and keep the UK rebate, all simply on the basis of historical precedent. But setting aside precedent, it also wants to change the terms of EU access to Scottish fisheries. Scotland seems to bring nothing attractive to the EU, apart from whiskey. World-renowned whiskey, of course, but is that enough?
Independence campaigners see an opportunity to renegotiate EU membership in Scotland’s favour, but do not expect other EU member states to do the same. This is short-sighted, and ignores the fact that it is against the interests of Spain and other countries with separatist movements to make entry of a breakaway state easy. Whilst Scottish membership is unlikely to be vetoed, it is even more unlikely to proceed on the terms proposed by the Yes campaign.
Note: This article gives the views of the author, and not the position of the British Politics and Policy blog, nor of the London School of Economics. Please read our comments policy before posting. Homepage image credit: Thomas Widmann
About the Author
Dr Sasha Vereker is a policy analyst and blogger, with a PhD in Philosophy from King’s College London. Her interests include education, international relations, and transport policy. Her philosophical research concentrated on decision-making, and, in particular, on analysis of what neuroscientific studies can tell us about the role of emotion in forming our decisions.
This person says that it is difficult to estimate Scottish contributions to the EU budget. Well maybe she does as her degree is in Philosophy.
She might care to bear in mind that Alex Salmond has a degree in Economics, and has worked in both government and private industry as an economist. In 1983 Salmond created a “Royal Bank/BBC oil index” that is STILL used today. Yes he is that good! As first minister, he also has access to a great deal of detailed information about the Scottish economy which she does not.
Where does her assumption that Scotland will keep the rebate come from? The rebate was negotiated by Westminster in part at Scotland’s for Westminster’s benefit.
Scotland will be a net contributor to the EU and will be very attractive to theEU.
And Alistair Darling was the Chancellor of the Exchequer – that doesn’t make him right on every economic issue. I agree that the line about whisky is a little silly, but there’s a reasonable point in there which is that to get the same deal we have under the current UK terms (rebate, opt out of Justice and Home Affairs and countless other areas) is pretty unlikely, particularly as we have to deal with incoherent nationalism of the kind you get from governments like the one in Spain. There has been a clear attempt on the SNP’s part to brush all of these issues off – the original line was “negotiating membership from within” – but they’re serious problems and we should at least be acknowledging them. It’s another issue, much like the currency, where the status quo is a best case scenario.
The Scottish Government are obviously limited in what information they have access to, so it seems pointless criticising them for lack of detail when it’s impossible for them to provide it. The UK Gov have been asked several times by the SG to ask the EU for their opinion on what would happen come independence – why is it that they don’t? There can be a great big spotlight shone on this issue, but it seems the UK Gov would rather it was not swirched on and it remains shrouded in mystery so that doubt can be cast on our future. Rail against that David rather than the Scot Gov.
Nobody has the answer to what we’re discussing here. The Commission certainly can’t issue a report explaining what all 28 governments will agree on in a future negotiation that may never actually take place and which most governments don’t have a formal position on. All we can ask for from both sides is a bit of perspective. So on the No side making arguments to the effect that we won’t be in the EU at all is clearly a nonsense, but it’s also equally silly to take a wildly optimistic view of what can be achieved.
To be clear on that point, the White Paper says that Scotland will negotiate a ‘smooth transition’ to EU membership that will “take place on the day Scotland becomes an independent country”. It also implies that all of the current provisions relating to the UK will apply to Scotland and that the rebate will apply to our budget contributions until at least 2020. The answer to a lack of information isn’t to fill in the blanks with overly optimistic projections, it’s to hold your hands up and accept that it’s a real area of uncertainty, that our future terms of membership could well be less desirable than what we currently have, but that despite these negatives we still back independence. That’s the honest case the SNP should be making.
Surely you don’t believe what you have said is true? Scotland gets more out of the eu and the U.K. Ad a whole. It has nothing to offer the eu. It oil reserves are falling its leader is out for her own gain. They are the 25 th net contributors to the eu. Behind most of the eastern block countries. Do you really believe Scotland can survive without the U.K. Input into its economy?
I can’t see what the argument is here.
As someone has already pointed out, Scotland cannot join the euro without running a convergent currency for at least 2 years, so that’s a non-issue.
Schengen is surely not an issue of consequence for other EU members.
The SNP’s position on the rebate and fisheries is only the position one would expect a state to take in advance of negotiations: does Sasha think the SNP is going to give these things away before negotiations have even started?
And Sasha writes as if the fact that Scotland runs a trade surplus with the EU (which her link doesn’t seem to show incidentally: it shows the trade balance between Scotland and the whole world) means that the EU will not mind losing Scotland as a free trade partner. But tax-free imports from Scotland are as important to other countries as tax-free exports to Scotland. It is economically illiterate to imagine that a negative balance of trade with another country means one would be better off with no trade at all with that country. Has Sasha never heard of triangular trade? Maybe read a basic book on economics eh?
Scotland is a powerful modern economy, with strong exports across multiple sectors, and a great deal to offer the European Union. To say that “Scotland seems to bring nothing attractive to the EU, apart from whiskey” is as silly as it is insulting.
Dr Sasha Vereker is a policy analyst and blogger, with a PhD in Philosophy from King’s College London. Her interests include education, international relations, and transport policy. Her philosophical research concentrated on decision-making, and, in particular, on analysis of what neuroscientific studies can tell us about the role of emotion in forming our decisions.
I have a relative who has an Honours degree in Philosophy but he wouldn’t pass Int 2 in politics and economics.
Here is a saying you can rely on :-
Expertise in one field is no guarantee of even basic competence in any other.
Dr Sasha Vereker is possibly the nicest person one could ever wish to meet,
but in offering an opinion like the piece above
without reference to Scotland’s massive oil and gas reserves
in the North Sea, the Atlantic Margin and Mainland onshore,
together with the almost limitless potential for renewable energy,
particularly from wind, tide and hydro,
then the value of her opinion is greatly diminished.
The EU will not turn it’s back
on one of the wealthiest countries in the world,
which Scotland will be after Independence.
The Constitutional, Political and Economic destiny of Scotland
will not be decided by uninformed chitter chatter
which dominates both social media and mainstream press and television
but by the application of essential realities.
This is spot on, but you need to learn the difference between whiskEy and whisky.
The last sentence is really the key point. The EU issue is another aspect of the independence campaign that seems to have descended to the lowest common denominator. Instead of discussing what kind of EU membership Scotland would have, we get a rather primitive argument about whether Scotland would or would not be an EU member in the first place. Key elements such as the rebate, fishing, the current opt outs in Justice and Home Affairs the UK enjoys and a whole range of other issues will determine whether our future membership is more beneficial than what we currently have through the UK. That’s what matters, not whether we’ll get in or not.
It’s an identical situation with the currency union incidentally: an argument that seems to revolve around the question “can we have the pound” while ignoring all of the elements that actually affect our economy – will the Bank of England act as lender of last resort, would there be budget scrutiny mechanisms, what
price (in terms of a larger share of the debt, a slice of oil revenue, trident or whatever else) would we have to pay for the rest of the UK to agree to this, etc.
Obviously all of these questions are unknowns, but what you can’t do, as the SNP are doing, is use that uncertainty to simply assume the negotiations will produce the best possible outcome for Scotland – while accusing anyone who disagrees of “scaremongering”.
I find it difficult to take this article seriously because the author clearly hasn’t done her research. 3 of the 4 “killer” bullet points are fallacious.
Point 1: It’s not even POSSIBLE for Scotland to join the Euro when she becomes independent – the rules don’t allow it.
Point 2: The Common Travel Area – search it and discover this from wikipedia for starters: “The Common Travel Area (CTA) is a travel zone that comprises the Republic of Ireland, United Kingdom, Isle of Man, Jersey and Guernsey. In general, the CTA’s internal borders are subject to minimal or non-existent border controls and can normally be crossed by British and Irish citizens with minimal identity documents.” It’s in no-one’s interest to force Scotland OUT of that arrangement and into Schengen.
Point 4: Scotland is a nett contributor. The negotiating for the entire EU region’s budget took years, and lots of hard work. and the ink is still drying on the agreement. If you take away Scotland’s contribution, or alter it either way, then you change the budget, including the rUK’s contribution. Does the EU want to open new budget negotiations with Scotland and rUK, and why would the other EU partners allow that if they don’t get a chance to do the same? What is much more likely is that Scotland and rUK’s contribution combined will match the current UK’s contribution, smoothing the waters, leaving the budget agreements intact. Pragmatism will be the name of the game.
That leaves the fisheries negotiations……so, what’s the big deal?