How will SNP decide the ‘wicked’ independence issues?


Stephen Maxwellby Stephen Maxwell

Six weeks after SNP won an outright majority in the Scottish Parliament an outline of the Scottish Government’s preferred strategy for fighting the Independence referendum has begun to emerge.

The referendum will be held in the latter part of the exceptional five year life span that the Westminster coalition’s political self interest has conferred on the Scottish Parliament, probably in 2014/15.

The Scottish Government would like the referendum to be overseen not by the UK wide Electoral Commission but by a bespoke Scottish Referendum Commission which would apply rules on the funding and conduct of the campaign agreed by the Scottish Parliament. It tends to favour a three option question covering the post Calman status quo, full fiscal autonomy and independence. It will publish a white paper explaining its understanding of full fiscal autonomy and independence in good time to inform and influence the public debate.

The Scottish Government’s initial thoughts on the referendum are its alone. The SNP Manifesto made a commitment to holding a “democratic referendum” on independence but said nothing about the SNP’s preferred question or the organisation of the campaign. This leaves the Government free to decide for itself what proposals it will put to the Scottish Parliament. Or does it?.

The SNP election manifesto was officially the manifesto of the Scottish National Party not the manifesto of the SNP Government. The party’s constitutional pedants – and it has a few – can argue that where the Party makes an in principle commitment to a referendum it should be the party as whole acting through its elected delegates to National Assembly, National Council and National Conference and not the Scottish Government who should decide the particulars of the proposal to be presented to the Parliament. And of course they can cite the clauses of the party’s constitution which give the party members the right to decide party policy – clauses 9.1, 10.1 and 12.1. Where the policy to be determined emanates from the founding ambition of the party entrenched in the first clause of its constitution– the restoration of Scotland as a “sovereign independent nation” – then the party’s constitution mongers will likely have the sympathy of hundreds of activists who have spent years or decades arguing that case to their sceptical fellow citizens.

The fact that there is so much uncertainty about SNP’s current understanding of independence in an interdependent world is down to one main factor – the failure of SNP to invest time and effort reviewing and updating its understanding of independence as global conditions have changed. Since devolution SNP’s policy making has been steadily centralised away from the party’s policy bodies, first to the party’s Parliamentary leadership and then from 2007 to the Scottish Government and its SPADs – Special Policy Advisers. The party’s members are not generally invited to participate and through persistent discouragement no longer even demand to participate. It is difficult to identify a substantive policy proposal initiated by the Assembly, Council or Conference in the last several years which has been taken up by the leadership. But there are plenty examples of major initiatives which have been ignored or trivialised – for example a call by National Conference in 2001 for a comprehensive review of taxation restated at the 2005 Conference as a call for the establishment of an Independent Commission for Modern, Competitive Taxation for Scotland, a call for a Scottish Defence Review at the 2010 Campaign Conference, the call at National Council in spring 2010 for the development of a policy to ensure that the banks and financial services in an independent Scotland served the needs of Scotland’s businesses and communities rather than those of financial speculators. Typically major policies are now delivered ex cathedra by Cabinet Secretaries at Annual Conference with minimal input from the party and under the scrutiny of the national media minimal opportunity for any serious debate or dissent.

The prospect of a referendum creates an urgent need to revive the party’s capacity and appetite for policy debate. The case for independence will be the target of rolling barrages of critiques, scare stories and misinformation at all levels, from the UK and Scottish media to social networks, workplaces, constituencies and wards, all generously funded by the diverse vested interests of unionism. The party’s activists have a vital role in combating this assault – provided that they feel sufficiently informed of the facts and the arguments to take ownership of the case. And the first step towards activists acquiring that confidence is to reclaim their role in policy development.

Over the last several years the the SNP has made significant progress in answering some of the key questions about independence. Its economic case is clear and strong. It has a vision of a sustainable future for Scotland though one that still lacks focus in areas such as energy conservation. It has proved its competence in Government. If it has failed so far to provide an entirely coherent account of how its social democratic ambitions can be integrated with those of its neo- liberal economic instincts which have survived the global financial crisis – the Nordic – Ireland polarity – it has at least succeeded in dispatching the old Tartan Tories jibe to the footnotes of the Scottish debate.

But its prospectus for independence as laid out most recently in the Government’s summary of its National Conversation Your Scotland, Your Voice (Scottish Government 2009) still leaves key independence questions unresolved.

Take defence. SNP is committed to the removal of the UK’s strategic nuclear deterrent from Scottish territory. But in the interests of preserving Scottish jobs it also wants to retain access to UK defence contracts and to maintain RAF squadrons at Lossiemouth and Kinloss. In other words the Scottish upstart wants to pull the UK’s strategic comfort rug from under the old man’s feet and be paid for doing so.

The UK’s response will be predictable – we’ll take seriously your need for defencejobs if you take seriously our need for a nuclear base: you can’t have one without the other. The solution is a Scottish nuclear free defence strategy and budget based on

Nordic models identifying a budget for local defence procurement alongside the savings available to create alternative employment for any net loss of Scottish defence jobs. Or the currency. SNP’s monetary policy of staying with sterling until the conditions are right for a transfer to the Euro has been overtaken by the global financial crisis. In its original Maastricht version the Euro was never likely to provide Scotland with a comfortable billet. The northern European ‘hard’ Euro now in prospect would be an even more exacting taskmaster for a new member needing to catch up with a large backlog of social and infrastructure investment. For all but the very largest or economically fortunate economies the choice of monetary alignment is always difficult. The diversity of monetary arrangements adopted by the smaller developed countries – from Canada, New Zealand, Norway and Switzerland with their separate currencies, to Sweden and Denmark with their different opt -outs from the Eurozone, to Finland, Greece and Ireland as variously disgruntled Euro members – suggests that at the least Scotland needs to review its options.

Scotland’s membership of sterling or a hardened Eurozone would certainly limit her fiscal flexibility,in the case of sterling probably without any formal role in the governance of the currency. It might also limit the scope to rebuild a Scottish based banking sector. The increased supervision of banks which currency unions are introducing following the banking crisis will make it more difficult for Scotland to promote new Scottish owned banks, private or public, or to diversify the types of banks available. Could an independent Scotland operate effectively with a significantly sized locally owned banking sector under Scottish regulation?. Would the Scottish interest be better served by a separate system of banking and financial regulation than by sharing in the system favoured by sterling or an alternative currency union?.

Another wicked question likely to be thrown up by an independence referendum is pensions. While the issue is less technically complex there seems to be an almost complete lack of information available to party members on the allocation and funding base of the various pensions liabilities which an independent Scotland would inherit.