Is a Scottish Independence Referendum On The Horizon? And What Does It Mean For You? - Carrington Dean stars-five-icons

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23.05.2018

Is a Scottish Independence Referendum On The Horizon? And What Does It Mean For You?

Scottish first minister Nicola Sturgeon has vowed to open up the debate again for Scottish independence based on “ambition and hope” from a new report.

An independent Scotland

Her statement comes just before the SNP release their Economic Growth Commission later on this week, entitled Scotland – The New Case for Optimism: A Strategy for Inter-Generational Economic Renaissance. It will be split into three sections, public finances, what currency an independent Scotland could use and look at the opportunities for economic growth.

The document which has been chaired by former SNP minister Andrew Wilson, looks at how the economy would grow and thrive in an independent Scotland, the costs and benefits independence would bring as well as the monetary policy.

He hopes the report will “generate serious and informed debates, not only in terms of future policy for the SNP, but among everyone with a state in the success of our country.”

It has been widely rumoured that the report will suggest the establishment of an independent Scottish currency – the uncertainty around keeping the sterling was a weakness of the 2014 Yes campaign.

According to The Scotsman the commission will also include simplifying income tax laws and new visa requirements which would attract affluent investors to Scotland.

Ahead of the party’s annual conference in October, the SNP will assemble a series of National Assembly meetings to discuss the findings of the report. A deputy leader will chair the National Assembly. Activist Julie Hepburn, Inverclyde Councillor Chris McEleny and Economy Secretary Keith Brown are currently in the running for the post.

The SNP leader told ITV’S Preston on Sunday she will “consider” the timing of a second independence vote in the autumn, once an agreement has been reached between the UK and the EU as well as more clarity surrounding their relationship.

She also stated At a time when economic thinking and debate is heavily focused on how we limit the damaging impacts of Brexit on Scotland, this report provides an opportunity to step back, to look at Scotland’s economic future with optimism and to focus on how we seize our opportunities and achieve our full potential as a nation.”

A second independence referendum was shelved right after the 2016 Brexit vote due to lack of support and desire for another vote. However, the findings of this report have clearly reignited the SNPs desire to start the debate again.

Brexit benefits Scotland

Meanwhile, Scottish Conservative leader Ruth Davidson argued Westminster ministers should make sure that Brexit benefits Scotland amid the recent news of another independence referendum. During the Policy Exchange think-tank conference, she stated it was vital to restore the bonds of the union after the Brexit vote as many pro-unionist Scots feel they have lost their shared values with the rest of the UK. She claims they now only feel bonded through economic security and regulatory ease.

In response to the First Ministers comments on Sunday, Davidson has warned of complacency among remain supporters and urged them not to believe the threat of an independent Scotland has disappeared as the SNP will use their power to “drive a wedge between Scotland and the rest of the UK”.

She also said “Now, at this point I could easily talk up the theory that Nicola Sturgeon has blown it, that the union is safe, that independence has had it. But, again, I would repeat my warning about the dangers of complacency.”

She has suggested to strengthen the alliance once again, the UK government and economy should be less dominated by London. She believes running powers that were previously placed in Brussels should be positioned around the country i.e. a fisheries organisation in Aberdeenshire.

However Conservative MP Michael Gove – who had a prominent role in the Brexit leave campaign – disagrees and believes the Brexit referendum has only made unionism “stronger” as there has been a decline in SNP support since the election. He has confidence that a vote in favour of Brexit was a vote of confidence in Britain and the Union.

Gove echoed the Scottish Conservative leaders comments of the SNP driving a wedge between Scotland and the rest of the UK, he criticised the party for using “identity politics” to promote Scottish nationalism.

However he himself has been accused of using anti-immigration tactics as part of the leave campaign during the Brexit referendum – most notably the notorious poster which read “turkey (population 76 million) is joining the EU”.

A spokesman for Theresa May also weighed in on the possibility of a second independence referendum, stating Now is not the time for another divisive independence referendum and there is no appetite for one. The people of Scotland voted decisively in 2014 to remain part of the United Kingdom and that should be respected.”

However, senior fellow at the Institute for Government think-tank Akash Paun, has warned Theresa May she could unintentionally ignite the break-up of the UK If she refuses Holyrood’s request for a powerful veto over major changes post-Brexit. Currently the EU Withdrawal Bill requires Westminster to consult with the devolved parliaments before many any policy changes.

His cautioning comes after the Scottish Government rejected Westminster’s Brexit plans by a landslide.

He claims the Prime Minister now faces a choice, she can “Concede defeat on the Withdrawal Bill, at the expense of losing some control over post-Brexit regulatory arrangements or hold course on Brexit, and prepare for a bigger battle over the future of the British Union.”

He also said if Westminster refused to acknowledge Scotland’s request and forced through major policy changes without their agreement it could change attitudes towards pro-independence and give the SNP the ammunition needed to hold another independence vote.

What an independent Scotland could mean for your finances

There are a lot of uncertainties surrounding what an independent Scotland would mean for the economy as it is all hypothetical at this precise moment. With that in mind we have highlighted key facts from leading industry experts to give an idea of how Scotland going it alone would affect your personal finances and the economy as a whole.

  1. The Scottish financial industry could plummet

Experts back in 2016 warned the doubts caused by independence looked even greater than those caused by Brexit, especially in terms of the financial services industry.

The industry employs around 180,000 people in Scotland and contributes around £8 billion to the Scottish economy.

Owen Kelly, head of Scottish Financial Enterprise and Jeremy Peat, ex chief economist at RBS, stated the impact of separating Scotland from the UK would have sever implications on the financial services sector as nearly every provider serves the UK rather than the EU.

  1. What currency an independent Scotland would use

The uncertainty around which currency Scotland would use if to become independent is still a big issue – would Scotland be expected to adopt the Euro if accepted into the EU, adopt the sterling or develop a whole new currency as the rumours are suggesting.

Mark Carney he bank of England chief has insisted that it is economically possible for an independent Scotland to enter a currency union with the UK but stressed it would be for others to decide if it was politically desirable.”

  1. Smaller economies perform better

It can be argued that the economies of small countries – similar to the size of Scotland – perform better than larger entities like the UK. Being a member of the EU – which Scotland would apply for – means small countries don’t have to be anxious about tariffs, currency wars and military alliances, as the EU provides guaranteed national security, stable trading relations and open markets.

However there is no guarantee Scotland would be accepted into the EU right away, it could take years to become a member.