The SNP: Making the Case for Union

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By arguing for a soft Brexit, the SNP are doing a great job of making the case for Scotland remaining in the UK.

The SNP lost the independence referendum for many reasons, but the transparent dishonesty of their economic case was probably the biggest factor. They tried to sell Scottish voters a pipe-dream based not just on hopelessly unrealistic oil revenue forecasts and a non-existent currency solution, but also on fantastically optimistic assumptions about how Scotland’s economy would be affected by breaking out of union with the rest of the UK, our largest trading partner.

Now the SNP is making the case for staying in the EU single market by using arguments that apply four-fold to the merits of Scotland remaining in the UK single market. They’ve got themselves in a real guddle here, but then it’s hard to be logically consistent when “independence” is your answer to every question.

Let’s be under no illusions about why the SNP is dead set against a hard Brexit. It’s not because they think it’s best for the UK, it’s not even because they think it’s best for Scotland, it’s because they think it’s best for their all-consuming obsession of Scottish independence, for their defining political ambition of dragging Scotland out of the UK.

The simple truth is that the further the UK is from remaining in the EU single market, the more economically damaging Scottish separation would be. For those of us who oppose Brexit, this is the silver lining in what is otherwise a very dark cloud: if we suffer a hard Brexit, a future independence referendum means asking Scots to choose between the UK single market or the EU single market.

Scotland exports four times more to the rest of the UK than we do to the rest of the EU. Of course the EU market is much larger, but even after nearly 45 years of unfettered market access, our exports there are relatively small (16%) compared to those to the rest of the UK (63%)¹. The reasons why are obvious: within the UK we’re transporting goods on the same island, we’re selling services to people who speak the same language, we’ve enjoyed over 300 years of free trade and of course we share the same currency.

Faced with this rather obvious point, supporters of Scottish independence either refuse to believe the Scottish Government's own data on exports¹, or they adopt the quite astonishing position of denying that the UK single market even exists. That it does is self-evident. Since the Act of Union was signed in 1707, all parts of the UK have enjoyed free movement of goods, services, capital and people, there have been no customs borders, we’ve had common laws governing market regulation and we’ve shared a single currency. The Act of Union may have been signed 311 years ago, but the provisions within it that define the UK single market are still very much in force today².

One of the arguments used by the SNP during the independence referendum was that Scotland could stay in the EU and so stay in the same market as the rest of the UK, thereby avoiding any trade disruption. This argument was always dubious, but following a hard Brexit it would fall apart completely. None of the benefits of being in the UK single market could be guaranteed for an independent Scotland.

Of course nobody’s suggesting trade with the rest of the UK would stop following a hard Brexit, any more than the arguments against a hard Brexit assume trade with the EU would stop. What we’re dealing with here is potential disruption to trade.

This is where the SNP’s latest arguments³ expose them as not just being logically inconsistent but also shamelessly hypocritical. When Sturgeon quotes economists at Strathclyde University’s Fraser of Allander Institute on the risk to Scottish jobs supported by EU trade, she neglects to mention that those self-same economists reckon that more than four times as many Scottish jobs rely on our trade with the rest of the UK⁴. When our First Minister quotes Treasury forecasters on the likely economic damage a hard Brexit would cause, she assumes we’ll forget that they’re the same Treasury forecasters Salmond accused of producing a “dodgy dossier” when they quantified the likely damage to Scotland’s economy that independence would cause⁵. It seems the SNP are rather keen on “Project Fear” when it suits them.

So the current arguments about Brexit highlight the greater relative importance to Scotland’s economy of the UK market compared to the EU – but they should also serve as a reminder that Scotland’s place in the United Kingdom is about so much more than free access to the UK single market.

Within the UK, Scotland is part of a UK-wide fiscal framework that currently allows approximately £10 billion a year of higher spending in Scotland than would be possible if we were “fiscally autonomous” (that is: than if we were simply “paying our way” within the UK)⁶. These annual transfers now can be seen as the quid pro quo for the fact that the economic benefits of “Scotland’s oil” were shared across the UK in the 1980s; that’s how pooling & sharing works over time.

But this UK-wide “pooling and sharing” is something that has no parallel in the EU. When Greece was in trouble, there were no fiscal transfers forthcoming from German tax-payers to bail them out. That these fiscal transfers occur within the UK but not within the EU illustrates a deeper truth that is rarely articulated: the bonds of moral solidarity that bind Scotland to the rest of the UK are stronger than those which bind us to the EU.

Whether one explains those bonds by reference to our history of shared endeavour, our shared values, our sense of national pride or some other aspect of shared British identity, the fact that such large sums of money are freely (and largely without complaint) moved between the UK nations is evidence that a deep bond exists. This might be best explained as a shared belief in social justice – we’re comfortable to share financial responsibility for the well-being of all our fellow UK citizens.

Hopefully we can agree that the arguments in favour of union aren’t all about things we can put a pound sign in front of, but we should at least consider what those billions of pounds of fiscal transfers mean in practice. They mean £1,900 annually for every man, woman and child in Scotland. That’s extra money the Scottish Government gets to spend on education, healthcare, free prescriptions, free elderly care, no tuition fees, toll-free bridges, business rates cuts and much more - stuff the SNP can crow about in a party political broadcast while still campaigning to leave the very union which makes that level of spending possible.

The SNP’s hypocrisy and intellectual dishonesty is laid bare when they argue for the benefits of union within the EU whilst simultaneously denying those same (but objectively larger) benefits of union within the UK. In terms of both market access and hard cash to support our higher public spending, Scotland’s place within the UK is objectively worth much more to us.

The economic case for union is often presented as something which is distinct from the emotional case. In fact these tangible economic benefits are simply a practical manifestation of the emotional case: they exist because of the deep bonds of moral solidarity that bind us.