Where stands Scotland? The political implications of Brexit

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By Alex Bruce @alexandersbruce

A month out from the UK’s momentous decision to leave the European Union, Orbit Communications Director Alex Bruce considers the implications for Scottish politics, for Scotland’s future relationship with the rest of the UK and with the European Union – and the likelihood and potential outcome of a second referendum on Scottish independence.

As was widely predicted prior to the 23rd June, the vote to leave the European Union has provoked a short term shock to the UK economy, particularly in terms of currency exchange rates, share values and the UK’s international credit rating. Leave campaigners continue to argue that the longer term economic gains of leaving the EU will outweigh this short term instability, but there are also worrying signs of the potential for significant job losses in the longer term, particularly in financial services.

At a political level, the Leave vote provoked an immediate leadership crisis within both of the main UK political parties. Even prior to the vote, it was always inconceivable that David Cameron would survive as Prime Minister if the UK voted to leave. Following an aborted leadership contest that saw all of the other contenders either eliminated or drop out, Theresa May has emerged as the new Prime Minister. Upon arrival at Number 10, she has made immediate efforts to shore up a potentially deeply divided Conservative party by appointing leading Brexit campaigners to those ministerial portfolios at the front line of Brexit negotiations. The challenge from here will be to reconcile the very high (some might say unrealistic) expectations of Leave voters and campaigners with what is likely to be a brutal negotiation with the EU27 in which EU leaders appear to hold most of the cards.

Meanwhile, a new leadership contest within Labour is already underway. However, it currently seems unlikely that challenger Owen Smith will be able to win the support of a majority of Labour party members, most of whom fiercely maintain their loyalty to Jeremy Corbyn’s leadership. If Corbyn clings on to the leadership, what will happen to a Labour party led by someone who has the confidence of only a small minority of the Labour parliamentary party remains to be seen. But its credibility as an effective opposition at Westminster has all but disappeared.

With a majority vote for Remain in Scotland, there has been an immediate increase in support for Scottish independence – albeit not the 60% support the SNP leadership had set as a benchmark to determine if a second independence referendum was winnable and therefore worth calling. Nicola Sturgeon remains sensibly cautious on the matter – treading a fine line between keeping the party faithful onside while at the same time not wishing to paint herself into a corner of having to call a referendum prematurely and then face the career-ending prospect of losing.

As opinion polling has consistently shown, it is also important to remember that it was predominantly the economic uncertainty of independence which swung the outcome in favour of ‘No’ in 2014 (and not the Vow as many on the Yes side have sought to claim). Confronting the Scottish electorate with a second independence vote before the future terms of the UK’s relationship with the EU are known might be seen by many as having jumped off the Brexit cliff only to be asked to take an event bigger leap of faith by leaving the UK.

Nicola Sturgeon has secured a mandate from the Scottish Parliament to seek negotiations with the EU institutions and other EU Member States to explore how Scotland could preserve its relationship with the EU as the UK prepares to leave.

But the issue now for Scotland is it lies stuck between a rock and a hard place. Although the First Minister may have received a warm welcome in Brussels, the devil of any future arrangement lies in the detail. Ultimately, just as the remaining EU Member States cannot be seen to give the UK an easy ride following its decision to leave, giving Scotland a preferential deal on EU membership which fudges the economic criteria would set a hugely dangerous precedent – as would transferring the UK’s preferential terms of EU membership to Scotland as a ‘successor Member State’.

The latter arrangement sets equally dangerous precedents within the UK. Scotland was not the only constituent part of the UK to vote Remain. A deal to secure preferential terms of continuing EU membership for Scotland will prompt an immediate clamour for similar treatment from Northern Ireland and London – something the UK Government is likely to be equally unwilling to entertain.

Despite all of the political manoeuvring currently underway to explore scenarios whereby Scotland could remain both a member of the EU and of the UK, the reality is that Scotland’s best prospect of a continuing positive relationship with the EU is either through a well negotiated Brexit deal for the UK as a whole that preserves access to the single market – or else by becoming an independent country and subsequently applying for EU membership.

In the current context, the economic case for Scottish independence is arguably on even shakier ground than it was in 2014. Latest figures show Scotland’s public expenditure outstripping its annual revenue by the order of almost £15 billion and the oil price remains stubbornly low. In pure financial terms, Scotland’s trade relationship with the rest of the UK is worth four times more than its exports to the European Union. The issue of currency also remains to be resolved although there are now moves afoot within the SNP to explore the possible creation of a new Scottish pound.

The outcome of a second Indyref will largely come down to whether the Scottish electorate’s economic instincts are now trumped by a sense that Scotland no longer has much in common politically with the rest of the UK – and a willingness to go through a potentially painful economic ‘adjustment’ to be able to strike out on its own path with the longer term aim of rejoining the European Union as an independent country. Given the current fractious nature of UK politics, it would be foolish to rule that out either.

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The EU, an opportunity to celebrate it and all it has achieved

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Alex Orr Alex_M_Orr

On Europe Day (9th May), Alex Orr, Managing Director of Orbit Communications gives his personal view on the era of peace and stability the European Union (EU) has delivered.

Today events take place across Scotland and the rest of the European Union (EU) to mark Europe Day, an annual celebration of peace and unity across the continent.

Thousands of people will take part in visits, debates, concerts and other events to mark the day and raise awareness of the EU. Europe Day is especially relevant this year, given the impending referendum in the UK on EU membership in just over six weeks’ time on 23rd June.

The day is also known as Schuman Day, commemorating the historical declaration 66 years ago on 9th May, 1950 by the French foreign minister, Robert Schuman, which marked the first move towards the creation of the European Union. Europe had just come out of the Second World War, a conflict that had nearly destroyed the continent and split it between two spheres of influence.

In a desire not to repeat such destruction there was a great deal of momentum towards European co-operation, which would make war between Europe’s nations unthinkable. Wartime British Prime Minister, Winston Churchill, standing next to Robert Schuman, had called for Franco-German reconciliation in a united Europe in a speech in July 1946.

Schuman’s vision was to create a European institution that would pool and manage coal and steel production. Through the Schuman Declaration the French foreign minister proposed the creation of a supranational European institution. This led firstly to the creation of the European Coal and Steel Community (ECSC) the following year. It was also the forerunner of several other European Communities and also what is now the EU.

The ECSC was founded on the principle that tying former arch-enemies economically together – originally through the weapons of war of coal and steel – would assist in ending the horrors of such conflicts and deliver much-needed reconciliation. And it has proven to be highly successful in transforming a previously warring continent, acting as the foundation of peace after centuries of bloodshed.

The delivery of peace, stability and prosperity are just some of the reasons why we should vote to remain in the EU in the June referendum, to see the bigger picture of the benefits that our membership brings.

Since the Schuman Declaration nations in Europe have forged closer links and come together to reach common solutions to common problems, keeping the peace and enhancing our collective security.

For those who are fighting for the values of freedom and democracy across the world the EU has been an inspiration, and for those member states formerly under the jackboot of dictatorship and Communism membership of the EU acted as a beacon of hope.

As we look towards the referendum, in a matter of weeks, it does no harm in being reminded what we have enjoyed, the precious gift of more than 60 years of peace, stability and prosperity in a previously war ravaged continent. This, all for the equivalent of a contribution to the EU of 26p a day from each and every one of us.

The EU is not perfect, far from it, but to leave would be to row against the tide of history and Europe Day gives us a chance to celebrate the EU and its many achievements.

Dutch presidency of EU will have positive impact on Scotland

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By Alex Orr @alexorr2016

At the beginning of this year the Netherlands took over the Presidency of the European Union, and there can hardly be a more critical time in the EU’s history for it to take the helm.

The Presidency, which lasts until the end of June, will seek to address current challenges facing the EU, of which there are no lack. These include the migration crisis, the UK Referendum on EU membership and the fight against terrorism.

In this role the Dutch presidency will shape policies and drive forward legislation that will impact on the futures of 500 EU million citizens, boosting growth and job creation through innovation, and delivering security.

The presidency work programme focuses on four key areas: Europe as an innovator and job creator; migration and international security; sound finances and a robust eurozone, and a forward-looking climate and energy policy.

As such its outcomes will clearly have an impact on Scotland. As an example, around half our international exports are destined for the EU, on which 330,000 Scottish jobs are dependent, and climate change is an issue that affects us all.

The European Union provides the biggest internal market in the world and is pledged to innovate in order to grow stronger and more competitive. In this respect Dutch are looking for red tape to be cut and rules that operate throughout the EU to be simplified and modernised, reducing bureaucracy and costs for citizens, companies and public authorities. This will clearly advantage Scottish businesses and consumers, as will be a renewed focus on greater cross-border co-operation in research and development.

There is also the small matter of the UK’s renegotiation of its relationship with the EU, the outcome of which will be put to the British people in an In-Out referendum, to be held before the end of 2017. As well as this is the ongoing refugee crisis and the desire to deliver common border controls and a co-ordinated asylum and migration policy as a solution to this issue.

While EU Presidencies can be seen as rather distant affairs, its outcomes should clearly be followed with interest here in Scotland.