Scottish vote could alter U.K. makeup

Referendum would change relationship in many ways

By Dale R. Herspring

The idea that the United Kingdom could be on verge of collapse seems impossible. The U.K. has long been our closest ally. We even fought two wars as allies. Yet there is a chance that the U.K. as we know it may not be the same after a referendum in 2014. 

Scotland’s separatist premier, Alex Salmond, heads the Scottish National Party, which won control of the Scottish Parliament last year for the first time since 1999. He announced in January that the Scots would hold a referendum in 2014 to determine if they will disassociate themselves from the U.K. To make matters worse, the issue is beginning to resemble divorce proceedings. To quote the Globe and Mail, “All is up for grabs: the house, the money, the debts, and the nuclear-armed submarines.”

So what is this about? First, it is important to note whether this referendum is held at all depends on political factors between now and 2014. Perhaps an agreement on Scotland’s position in the U.K. will be reached that making the vote unnecessary. British Prime Minister David Cameron went to Edinburgh recently and offered the Scots more powers and rights in exchange for a referendum that falls far short of separation. As he put it, “I believe that England, Scotland, Wales and Northern Ireland are stronger together than they would ever be apart.” Unfor-tunately, Salmond rebuffed him.

Salmond says Scotland would not cut all ties with the U.K. Citing Canada, Australia and New Zealand as examples, he insisted that the queen would remain the head of state. He also said Scotland would keep the British pound, the BBC and other things. The queen has not commented, and if history is any example, she will have nothing to say about it.  Salmond says Scotland would remain in some undefined relationship with England and Wales.

If the referendum were to go his way, Salmond could expel the British nuclear fleet from Scottish waters. He also could withdraw from NATO and withdraw Scottish regiments from Britain’s armed forces. Scotland could send its own representatives to the United Nations and the International Monetary Fund, among other international groups. Meanwhile, both sides are far apart on the wording of the referendum and whether 16- and 17-year-olds would be permitted to vote.

For its part, London has been taken a hard line.  It has made it clear that a “yes” vote would mean total separation.  As one Labor member of the House of Lords put it, keeping “the Queen, the pound, the Scots Guards and EastEnders” is a ‘funny’ idea of independence.”      Meanwhile, the Chancellor of the Exchequer has clear that Britain would not permit Scotland to remain part of British currency. “The Scottish National Party is going to have to explain what its plans are for the currency of Scotland.”

One of Scotland’s advantages —  or disadvantages, depending on how you look at it — is North Sea oil. An independent Scotland would have access to 80 percent of British oil and gas within its territory.  However, it would have to renegotiate contracts with the international oil companies involved in the hunt for oil. Besides, most observers believe those oil fields will be depleted by 2030.  The down side of the oil bonanza is that Scotland would be almost totally dependent on North Sea oil. It generates about 22 billion pounds from other exports — including 3.3 billion from whisky. However, even with oil income, Scotland would face a possible drop in exports because it would have to absorb 140 billion pounds as its share of U.K. debt.  Government expenditures at current levels exceed what it would receive from North Sea oil and taxation combined.  To quote an official Scottish report, “Even with a favorable settlement on future oil revenues, its fiscal balances are likely to be volatile, with large deficits in some years as a result of its dependence on oil revenues.”  What would an independent Scotland do once the oil is gone?

It is unclear what will happen if the referendum takes place.  Traditionally, about 30 percent of Scots favor independence.  However, this outcome is said to be too close to call. In 1997, Scotland gained a large measure of self-rule within Britain.  However, many Scots appear disenchanted with the political leadership in London, perhaps even to the point of voting to leave the U.K.

A member of the Welsh Nationalist Party put it well when he said, “If Scotland becomes independent, the whole thing changes. Every-thing’s up for grabs.”

Dale R. Herspring, a University Distinguished Professor and a member of the Council on Foreign Relations, is a retired U.S. diplomat.

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