On 17 November 2023, the Scottish Government published the latest policy paper in its Building a New Scotland series which in the Scottish Government’s words “together form a prospectus for an independent Scotland”.
The paper focuses on an independent Scotland in the EU. This blog examines some of the key issues covered in the Scottish Government’s paper.
The desire for EU membership
The paper starts from the premise that Scotland voted against EU exit (by 62% to 38%) but was taken out of the EU because of the UK-wide result. According to the Scottish Government, given that polling suggests continued support for membership of the EU in Scotland, the only way for Scotland to resume EU membership is through independence.
The Scottish Government then set out what it believes would be the benefits of EU membership. These include:
- Scotland being part of the world’s largest single market, with free movement of goods, services, capital and people.
- Membership of the single market would allow Scottish firms to trade freely with more businesses and sell to more customers.
- Scotland could attract and retain people from across the EU to sustain its businesses, world-leading universities and public services and help address Scotland’s demographic challenge of a falling population.
- Scotland would enjoy opportunities to foster cultural exchanges and develop research partnerships to promote the prosperity and wellbeing of its citizens.
- Membership would place Scotland at the heart of an organisation with global reach. It would work together with its EU partners to develop policies and collaborate on tackling global challenges such as climate change.
- Membership would allow Scotland to regain access to the EU’s law enforcement tools, which help in the fight against cross-border crime and threats.
The paper also reflects on what Scotland would offer the EU as a member and on what Scottish citizens and Scottish business could expect from EU membership.
Representation in the EU versus representation in the UK
The Scottish Government uses its independence in the EU paper to make a direct comparison between being a component part of the UK compared with being an independent nation in the EU.
The Scottish Government argues that “the two unions – the United Kingdom and the European Union – are fundamentally different”. It points to instances of the UK Parliament legislating in devolved policy areas without the consent of the Scottish Government or Scottish Parliament. It adds that Westminster can:
“legally ignore the democratically expressed wishes of people in Scotland. And it can reverse and even end devolution.”
In contrast, the Scottish Government argues that as an independent member state in the EU, Scotland would be “fully involved in policy development and decision making”. It sets out that an independent Scotland would be represented at every level of EU decision making and able to influence decisions and promote Scotland’s interests.
While the EU does choose to make some decisions by unanimity, many are made in the Council by qualified majority. As the Scottish Government’s report recognises, this requires 55% of member states, accounting for at least 65% of the EU population, to vote in favour. This means that whilst an independent Scotland in the EU may be able to exert influence on the decision-making process, it is not necessarily the case that it will always achieve the outcome the Scottish Government wishes and may often have to compromise to achieve a consensual EU position.
An independent Scotland in the EU would be able to nominate representatives to the EU institutions, including the European Commission and the Court of Justice of the European Union. However, whilst Scottish, these representatives will be expected to represent the interests of the EU as a whole – as the Scottish Government’s paper recognises.
Scottish representation would also be present in the Council of the EU meetings and Scotland would get the opportunity to hold the Presidency of the Council of the European Union. As this position rotates between member states, Scotland would get this role for six months once every 14 years, perhaps longer if the EU enlarges further.
In the European Parliament, an independent Scotland would be apportioned a number of MEPs based on its population size. Member States of similar population size such as Denmark, Finland and Slovakia will all have 15 MEPs from the 2024 European Parliament election. 720 MEPs will be elected at the 2024 election. This means Member States such as Denmark will have just over 2% of the overall composition of the European Parliament. However, the Scottish Government highlights that:
“Because seats are allocated by the principle of ‘degressive proportionality’ (i.e. smaller countries are allocated more MEPs than they would be allocated in proportion to their population size) smaller member states have more representation for each of their citizens compared to larger member states. This strengthens the voice of smaller member states, and their citizens, in the European Parliament.”
In making the argument about member states around the same size as Scotland having power in the EU, the Scottish Government highlights that 12 of the current 27 member states have population sizes similar to, or less than, Scotland’s. The paper suggests that these member states are able to be successful by working within the EU structures because they can “set their own course but work with partners to tackle societal challenges and deliver health, prosperity, security and opportunity for their citizens”. Finally, the Scottish Government suggests EU membership is preferable to being part of the UK because:
“This section has shown that the two unions – the UK and the EU – are fundamentally different in how they operate. Sovereignty should mean having a seat at the table, a voice in the debate and a vote on the outcome. As a ‘devolved nation’ Scotland does not have this. In comparison to the limited opportunity to represent and protect Scotland’s interests as part of the UK, Scotland would be better off by gaining, sharing and enhancing our sovereignty through independence and EU membership.”
Meeting the membership criteria
The paper also sets out what opportunities, responsibilities and contributions would arise from EU membership for an independent Scotland.
The Scottish Government makes clear it believes that Scotland has much to offer the EU including “renewable energy resources, ambitious climate commitments, renowned research and innovation expertise and a vibrant and diverse culture”. In addition, the paper states that Scotland would almost certainly be a net contributor to the EU budget, this would certainly be the case in the event Ukraine joins the EU at some point in the future. On being a net contributor, the Scottish Government highlights that it is not necessarily a zero-sum game as EU membership may result in economic benefits.
On currency the Scottish Government states that joining the euro will not necessarily be required:
“In relation to the euro, as the European Commission has made clear, no timetable for member states joining the eurozone is prescribed and as for other new EU member states, joining the euro would happen only if both the conditions for doing so (known as the convergence criteria) were met and the Parliament of an independent Scotland decided this was the right course of action to take.
The architecture of the Economic and Monetary Union (EMU) explicitly stipulates that a country will only join the euro when it is ready, and the convergence criteria are there to ensure that introducing the single currency would be desirable both for the member state and the eurozone as a whole.”
The paper highlights the examples of Bulgaria, Czechia, Hungary, Poland, and Romania which have yet to adopt the euro, in some cases approaching 20 years after accession whilst Sweden, which became a member state in 1995, still uses its own currency.
The Scottish Government also states that the European Stability and Growth pact which is a set of rules designed to ensure that countries in the European Union pursue sound public finances and coordinate their fiscal policies is currently suspended to support economic recovery post-COVID. The Government adds that the European Commission is expected to adopt “a more tailored approach to individual member states’ circumstances, while retaining the fundamental budgetary objective of fiscal sustainability”.
An Independent Scotland in the EU also commits Scotland to joining the Common Fisheries Policy (CFP) and the Common Agricultural Policy (CAP). On fisheries, the paper recognises that whilst some parts of the CFP were challenging for some Scottish fishing interests during the UK’s membership of the EU, membership itself “brings wider benefits for fishing and coastal communities, including opportunities to increase seafood trade and support for those communities”.
How long to join the EU?
An independent Scotland in the EU states that the Scottish Government would apply to join the EU as soon as possible after independence. It highlights the route to accession as set out in Article 49 of the Treaty on European Union and accepts that Scotland would be required to comply with the EU acquis (the body of laws of the EU) and the Copenhagen Criteria.
Because Scotland was recently a member of the EU (as part of the UK), the Scottish Government believes meeting the membership criteria should be relatively straightforward and as a result membership might be achieved quickly. However, as the Government recognises, the terms of membership will be subject to a political negotiation and all 27 member states will need to agree on the terms of Scottish accession.
The Government highlights that the accessions of Austria, Finland and Sweden took less than two years from being recognised as a candidate country to membership. When those three member states joined the EU in 1995, there were only 12 member states to agree the terms of membership with. An independent Scotland would be required to negotiate with an EU of at least 27 member states where each state would have a potential veto.
The Scotland-England border
Upon independence, the border between Scotland and England would become an international border. The Scottish Government indicates it wishes to remain part of the Common Travel Area – as Ireland has done. This means an independent Scotland would seek an opt-out from the requirement to join the Schengen area which allows for free movement throughout the participating Schengen countries. Given Ireland already employs this approach, it is likely Scotland would be able to negotiate it as part of its membership terms.
However, an independent Scotland in the EU would mean that Scotland and England would share a trade border. An Independent Scotland in the EU recognises this:
“As a member of the EU, an independent Scotland’s trading relationship with the rest of the UK would be governed by whatever agreed trade arrangements between the EU and the UK were in place at the time (currently the Withdrawal Agreement and the Trade and Cooperation Agreement).”
Whilst the Scottish Government suggests that “the Scottish Government, for its part, would put in place measures to smooth checks required as a result of Brexit on goods moving to and from England and Wales”, the level of disruption to trade will depend on how the EU-UK relationship develops as the Scottish Government recognises:
“A number of recent developments at a UK level make it difficult to state definitively what checks may or may not be required for exports from an independent Scotland to the rest of the UK.”
In a report for the UK in a Changing Europe, Professors Nicola McEwen and Katy Hayward set out how an independent Scotland’s border with England would change:
“If the Parliament of an independent Scotland wanted its rules and standards to apply to all goods sold within Scotland, there would have to be checks and controls at its land and sea borders, irrespective of whether it joined the EU. As an EU member state, Scotland would have to follow and apply EU customs and regulatory rules on goods circulating within it. This would change the status of the Scottish land border — all 154 km (96 miles) of it — and the experience of crossing it.”
Trade over the border
Whilst an Independent Scotland in the EU stresses the importance of the EU as Scotland’s biggest international trading partner, it says less about the trade relationship between Scotland and the rest of the UK.
The most recent trade statistics for Scotland, published by the Scottish Government were published in 2019. These showed that Scotland’s goods and services exports (excluding oil and gas) to the rest of the UK were valued at £52.0 billion whilst exports to the EU were valued at £16.4 billion and other international exports were worth £18.7 billion. Exports to the rest of the UK accounted for 60% of the overall total, and EU and non-EU exports accounted for 19% and 21% respectively.
The Scottish Government paper uses the example of Ireland and its move away from an over reliance on the UK as a trading partner following accession to the EU in 1973 (at the same time as the UK):
“Membership of the European Economic Community (EEC) and EU has played a pivotal role in diversifying Ireland’s economy. Ireland joined the EEC in 1973 (when the UK also joined) and this quickly led to the geographic diversification of Irish exports. However, even as late as 1979 the UK accounted for about a half of both exports to and imports from Ireland. The subsequent period brought further diversification, which coincided with accelerated trade liberalisation in both Europe and globally.
Over the period following the establishment of the European single market in 1992, the EU’s share in Ireland’s imports of goods increased. Over the same period Ireland reduced its reliance on the UK economy, in both imports and exports of goods.”
The suggestion from the Scottish Government seems to be that an independent Scotland joining the EU would over time lead to a rebalancing of Scottish trade from the UK to the EU.
Conclusion
The Scottish Government’s proposals for an independent Scotland in the EU set out a case for EU membership based on a perspective that Scotland’s will have more influence in the EU than it is currently able to exert within the UK.
The proposals set out a willingness on the part of the current Scottish Government to accept the obligations of EU membership including a likely net contribution to the EU budget, participation in the CFP and CAP and the opportunity to participate fully in EU funding programmes. The paper also sets out the Scottish Government’s belief that adopting the euro would not be required of Scotland in the short to medium term.
Whilst the Scottish Government sets out a positive case for re-joining the EU single market, the paper does not really address issues related to the volume of trade that Scotland currently does with the rest of the UK. On whether there would be disruption to those trade flows, the Scottish Government suggests that Scotland-rest of UK trade would be as seamless as the EU-UK relationship will allow. In addition, there is a focus on how Ireland has redressed its balance of trade between the UK and the EU albeit this has taken place over many years.
The Scottish Government’s perspective for EU membership leans heavily on the suggested benefits of EU membership which were discussed during the EU referendum campaign in 2016. Ultimately the terms of an independent Scotland’s membership of the EU would be the subject of a political negotiation between the Scottish Government and the European Commission which would be responsible for representing the interests of the 27 member state governments.
Iain McIver, SPICe Research