Economics of Independence

Only a ‘Yes’ vote guarantees more powers for Scotland

Written by Michael Gray

Scotland_Parliament_HolyroodA majority of people in Scotland want the Scottish parliament to have full control over taxation, spending and social security. 

Increasingly it appears that only a ‘Yes’ vote in 2014 can guarantee those powers for Scotland. Why? Because Westminster remains uninterested in further devolution.   Scotland should learn from history, Westminster is resistant to reform.

If Scots want a strong parliament they face a straight choice: vote ‘Yes’ for greater political control or risk voting ‘No’ and getting nothing.

Some notable figures have already made their choice.  Lesley Riddoch, Ruth Wishart and Mary Lockhart were all persuaded of the case for independence as the case for greater devolution stalled.   From a business perspective, the guarantee of full economic powers convinced Jim McColl to support independence.

Jim McColl


“It appears that only independence as defined by the Scottish Government, an independent nation within this social union and common market of the UK, will allow England and Scotland to pursue distinct economic policies in the face of different demands and competitive pressures.”  Jim McColl.



The Scottish Green Party conference voted to support independence; and now voices in the Conservative, Labour and Liberal parties in Scotland have all set out arguments for a ‘yes’ vote.

Westminster or Scotland?

These are arguments based upon who people think should make decisions: Westminster or Scotland. It is a question based upon how our politics can best suit Scotland’s needs and interests. A majority of Scots agree that Scotland needs far greater powers to do this – not because they are ‘nationalists’, but because greater political autonomy provides the power to make decisions. In these circumstance 60% of Scots trust Holyrood, while only 16% trust Westminster to make those decisions.

Yet for that majority, the referendum may present a quandary. A ‘Yes’ vote guarantees this control, but simultaneously the no campaign claim that more power could materialise following a ‘No’ vote. Is this believable? Can Westminster be trusted to grant Scotland more powers?

Learning from history

There are two lessons to be taken from history: when further devolution has failed and when it has succeeded. It is then worth comparing those circumstances to our modern situation.

Firstly, there have been many, many cases where further devolution has been promised but was never delivered.

  • In 1885 Keir Hardie stood on an independent Labour platform for Home Rule. When Labour formed their first Westminster Governments in 1924 and 1929, Prime Minister Ramsay MacDonald told his Scottish colleagues that there was no appetite for Home Rule within his London cabinets. The promise of Home Rule was denied. 
  • In ‘The Declaration of Perth’, 1968, former Prime Minister Alec Douglas-Home committed the Conservative party to support Scottish devolution. Then they backtracked and opposed a Scottish Assembly in 1979. 
  • In that same referendum Labour scuppered their own devolution proposal by imposing a confusing 40% threshold. Although more Scots voted ‘Yes’ than ‘No’, the vote was rejected.
  • Margaret Thatcher had promised a better form of devolution if Scots voted no, but this also failed to materialise. Subsequent campaigning for devolution and the Constitutional Convention was ignored by Westminster governments in ’83, ’87 and ’92.

It is easy to forget how many devolution promises and proposals disappeared without a trace. In 2014 it is important that Scots do not forget.

The second lesson of history concerns the establishment of a Scottish Parliament. This was not a simple process. It was achieved through a long term campaign of protest, research, cooperation and consensus building. The Claim of Right, Constitutional Convention and eventually the Consultative Steering Group were built from a generation of organisation. There was also persistent electoral pressure from the SNP to influence politicians. This brought the devolution proposals to fruition.

History demonstrates that devolution proposals often fail. Complication, disinterest and sabotage have halted previous attempts. The experience of the Constitutional Convention demonstrates that further powers can be won for Scotland, but only following a generation of campaigning and pressure.

With a similar interest in further devolution today, planning could have begun in earnest as of May 2011. But it didn’t. Instead further devolution has been kicked into the long grass through a maze of different inquiries. According to a Panelbase poll 67% of Scots believe there will be no new powers or fewer powers for Scotland following a ‘No’ vote. There are good reasons for such doubt. Here are six:

1) A second question was rejected. 

A choice of further devolution was rejected from the 2014 ballot paper. This would have provided a democratic mandate for greater control over taxation and social security. Those who support further devolution rejected this opportunity.

2) Recent devolution proposals have been watered down

The Calman Commission proposed modest increases in devolution. The level of tax control in Scotland may rise from 12% to 30%. (Devo More Figures) Yet even some of the proposals in the Commission failed to make it into Westminster’s Scotland Act.

3) Silence from Westminster

Further devolution depends upon the support of the Westminster Parties and MPs elsewhere in the UK. So far the unionist parties have refused to be drawn on the details of further devolution. This is important. They will decide what party policy is in 2015. If they decide not to support greater tax and welfare powers for Scotland, it won’t pass Westminster. This cannot be unilaterally determined by Scotland or politicians here. Will any leader in London want to give up substantial influence over Scotland? Only 8% of Scots believe that taxation on oil revenues would be devolved after a ‘No’ vote.

4) EU and the 2015 Election

The electoral arithmetic in 2015 is quite simple. Labour require more seats in the Midlands and the South. The Conservatives need more seats in the North of England. Both parties want to safeguard their votes from UKIP. This is why the conservatives have promised a vote on leaving the EU. Polling shows people in England wanting to leave the EU (but that Scots wish to remain members) – and this issue will dominate the early years of a future parliament. It is European constitutional politics – not Scottish – that will influence UK leaders in 2015 and beyond. This makes legislative work on further devolution less likely in the next Parliament.

5) Scottish leverage will be gone

One of the driving forces behind calls for devolution has been the electoral threat of independence and the SNP. Rising interest in independence placed devolution on the agenda in the 60s and 70s. George Robertson famously remarked that devolution would ‘kill nationalism stone-dead’. Political and electoral motivations have spurred the desire to present an alternative to independence with Westminster seceding some powers rather than risk losing total control over Scottish revenue and resources. However, if the prospect of an independent Scotland is taken off the table for a generation Scottish leverage will dissipate. Some at Westminster even see this as an opportunity to cut funding and support for Scotland further.

Andrew Neil warns Scots not to trust Westminster

As Andrew Neil has said, “Devolution, the Calman Commission, the Scotland Bill, the Edinburgh Agreement, all of this and more you have, is because Westminster parties are scared of the SNP.  If you vote ‘No’ you massively change the balance of power and they will not only give you nothing, but will probably take powers away from the Scottish Parliament”.

Witnessing Andrew Neil’s warning last year at a charity dinner was the spark that led Tory donor and longterm Conservative Party member Laurie Clark to publicly support independence having previously been a fan of devolution.

6) Another referendum!

A House of Lords Report has stated that any further powers for Scotland should be subject to a UK wide constitutional process, including the possibility of UK-wide referendum.  This means that MPs in London and the South East who benefit most from the union get a veto on whether or not to reform it.

Just as honest attempts to reform the Westminster voting system and second chamber descended in dissatisfying fudge, so would further devolution for Scotland

These are but some of the uncertainties and risks raised if Westminster is placed in charge of Scotland’s future. As the referendum draws nearer, more questions will be asked of whether Westminster’s political leaders will commit to further devolution and in what form. If you are already persuaded of the case for independence, do not hold your breath for answers. If you remain undecided pay close attention. The obfuscation will increase and the assurances that you should ‘wait and let Westminster decide’ will persist.  Yet with only 16% of Scots trusting Westminster, this prospect will only spur calls for independence in 2014.

As it stands, if Scots vote ‘No’ we risk getting nothing. No powers. No progress. If Scots vote ‘Yes’, we get 100% control of our own affairs and the full opportunities of independence.

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About the author

Michael Gray

Michael is Head of Research with Business for Scotland.

A graduate from the University of Glasgow, he has carried out a series of interviews with academics, politicians and the public in Denmark, Iceland and Ireland. Michael's on twitter @GrayInGlasgow.


  • I have asked this question many times of BT and have never had an answer yet. “If we are truly Better Together, then why can’t the three main parties in the BT group formulate an agreed coherent policy that will guarantee increased devolved powers for Scotland in the event of a no vote?” I have offered my theory, which has not been responded to, “IT’S ALL SMOKE AND MIRRORS”

  • so can you please explain how ‘full control of taxation’ works in a currency union with rest of UK? Or do you really mean more than just now but not as much as if we had own currency?

  • […] This has already been foreshadowed in the very public questioning of devolutionary powers in Scotland by Margaret Curran, a senior Labour Party figure in the country, and by the words of Andrew Neil, a leading Scottish-born journalist and pro-Union media presence, who has pointed out that a No vote will inevitably lead to severely reduced devolutionary powers in Scotland. […]

  • Ah, young Mr. Gray, staff writer, no less. Proof that Business for Scotland members seek out and invest in new opportunities and look to the future.

  • […] A majority of people in Scotland want the Scottish parliament to have full control over taxation, spending and social security.Increasingly it appears that only a ‘Yes’ vote in 2014 can guarantee those powers for Scotland. Why? Because Westminster remains uninterested in further devolution. Scotland should learn from history, Westminster is resistant to reform.  […]

  • We are all very aware that the media and politicians of all shades have convinced southern voter ( and Scottish) that Scotland is oversubsidised, gets much more than they do and are a drain on UK resources. Imagine a Tory or Labour candidate trying to sell the idea to an English electorate of giving more to Scotland. It just won’t fly. It would be a vote killer for an English MP.

    The Tories are terrified of UKIP and Labour desperately need to appeal to middle England voters. Giving more to the ‘subsidy junkies’ up North is not how they plan to win the next UK election in the event of a No vote.

    • That is a good point Adam, there are many who seem to believe that Scotland finances don’t add up but that is only because traditionally when the finances were presented Oil and Gas, Corporation Tax, export duties on whisky and food etc were all taken out of Scotland budget and when you take that lot out it looks like we are in deficit all the time.

      Add those revenues back in and for 30 years in a row Scotland has raised more taxes for the UK than the average per head for the rest of the UK – ipso facto Scotland actually subsidises the rest of the UK – you would think they would just say thanks!

  • Good article and pleasing to see an articulate understanding of the history of devolution. The key point here is around the concept of Westminster ‘granting’ further powers to Scotland. I see no reason for them to act against their own vested interests. Scotland should vote ‘yes’ then all the powers accorded to any country acting in the best interests of their citizens will be theirs. Simples!

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