Scottish independence referendum 2017?

[ag]

One issue is that Sturgeon truly believes that Scotland as an EU member state could hold on to the pound, while the EU has made it clear that all new member states are obligated to adopt the euro after a transitional period. Brussels has no real incentive to make an exception in the case of Scotland.

not strictly true, Denmark (and the exUK) have official opt outs, the Swedes have an official policy of intentionally failing to meet the criteria for joining and the Poles and others are also dragging their feet

to me the obvious route after independence is to keep the GBP for a year while setting up a mint and a central bank (or working out how scotland's note-issuing commercial banks operate from now) then bring in a separate Scottish pound pegged to GBP for a while before letting it float off, stability is maintained through the transition and the issue of adopting the Euro is kicked safely into the long grass for long enough to keep everyone happy

Well, conveniently, they do not even have to issue the new bank notes: Scottish pound exists. It can simply be unpegged. And, yes, the euro can be done at some point in the future. Though, frankly, I am not even sure they would care much to oppose.

[IceAgeComing]

The banknotes printed in Scotland are... odd; basically they're printed by commercial banks but they have to keep the value of the notes that they are printing in the Bank of England; the BoE is still the Central Bank, its just that some of the notes have "Bank of Scotland" or "Clydesdale Bank" on them.  I think the only reason that we've held onto them is a mixture of tradition, a form of nationalism and the fact that its cheap advertising for the banks that print them.  There's also the fact that its something that's Scotland and NI only; and changing banknote laws in two small parts of the UK is never going to be a pressing government concern.  Certainly not a base for a whole new currency of its own though!

[Helsinkian]

not strictly true, Denmark (and the exUK) have official opt outs, the Swedes have an official policy of intentionally failing to meet the criteria for joining and the Poles and others are also dragging their feet

As I said, all new member states have to adopt the euro eventually. The exceptions given to UK & Denmark don't apply to new joiners.

And Scotland can be sure that the they won't find favourable negotiation partners in Brussels if they say that it is their intention to deliberately skirt the rules and punt on the currency.

[ag]

not strictly true, Denmark (and the exUK) have official opt outs, the Swedes have an official policy of intentionally failing to meet the criteria for joining and the Poles and others are also dragging their feet

As I said, all new member states have to adopt the euro eventually. The exceptions given to UK & Denmark don't apply to new joiners.

And Scotland can be sure that the they won't find favourable negotiation partners in Brussels if they say that it is their intention to deliberately skirt the rules and punt on the currency.

I am pretty sure, Scots will not consider it to be among the top 75 concerns in voting for independence. Scottish pound would be a cool currency to keep, but the Irish gave their punt up with hardly a murmur. In any case, once they leave UK and join EU, they would probably prefer to be in euro zone to being in the pound zone.

[ag]

The banknotes printed in Scotland are... odd; basically they're printed by commercial banks but they have to keep the value of the notes that they are printing in the Bank of England; the BoE is still the Central Bank, its just that some of the notes have "Bank of Scotland" or "Clydesdale Bank" on them.  I think the only reason that we've held onto them is a mixture of tradition, a form of nationalism and the fact that its cheap advertising for the banks that print them.  There's also the fact that its something that's Scotland and NI only; and changing banknote laws in two small parts of the UK is never going to be a pressing government concern.  Certainly not a base for a whole new currency of its own though!

Why not? This is only for the few years before joining the euro. For these purposes they could designate one of the issuing banks as the central bank, or create a smallish independent central bank. Push comes to shove they could even negotiate for ECB to help them out during the transitional period. And having notes already out there is a huge help logistically.

[IceAgeComing]

As I said, all new member states have to adopt the euro eventually. The exceptions given to UK & Denmark don't apply to new joiners.

Its one of those things that although technically you have to do it you can get around actually doing it; ERMII membership isn't mandatory and you need to join that before you adopt the Euro.  That's how Poland and the Czech Republic are getting around the Euro requirement, and no one seems to be moaning at them a whole lot...

[Clyde1998]

One issue is that Sturgeon truly believes that Scotland as an EU member state could hold on to the pound, while the EU has made it clear that all new member states are obligated to adopt the euro after a transitional period. Brussels has no real incentive to make an exception in the case of Scotland.

Not true. There are five requirements to join the Eurozone:

• Sound public finances – the government’s deficit must not be higher than 3% of GDP.
• Sustainable public finances – the government’s debt must not be higher than 60% of GDP.
• Durability of convergence – the country’s long-term interest rate must not be more than 2% above the rate of the three best performing Eurozone member states in terms of price stability.
• Price stability – the country’s Consumer Price Inflation (HICP) rate must not be more than 1.5% above the rate of the three best performing Eurozone member states.
• Exchange rate stability – the country’s existing currency must have been part of ERM II (Exchange Rate Mechanism II) for at least 2 years without severe tensions.

On point one. Scotland's current deficit is 7.8% of GDP (including a proportional share of North Sea Oil) according to the Scottish Government's figures, which is higher than the rate allowed before joining the Euro.

On point two. The UK national debt is currently just over £1.714tn. Scotland would most likely take a population share (8.4%) of the debt, which is £143.976bn or 95.2% of GDP (compared to 93.6% for the UK). Although, a large percentage of this is owned by the Bank of England, so it would be interesting to see if Scotland takes that debt, if Scotland doesn't have access to the central bank (and if they did they wouldn't need to join the Euro). 95.2% of GDP is much higher than the required 60% to join the Eurozone.

On point three. We can only, currently, judge Scotland on the UK's figure. The UK's current long term interest rate is 1.48%. The long term interest rate is based on 10 Year Treasury Bond Yields. I'm not sure who the three best performing Eurozone members are, but let's say that this is a pass.

On point four. As with point three, it has to be taken from the UK's figure, which is 0.5%. Which should met that requirement.

On point five. We don't know what Scotland's finances will be if and when Scotland becomes independent - so it's possible that the other four are all met by the time we get there. But the Pound Sterling is not and isn't going to be in the ERM2, unless the UK Government and British people have a pretty sudden change of heart. Therefore Scotland couldn't join the Eurozone on independence, and there's not point adopting a new currency, just to change it after two years.

tl;dr version:
Scotland cannot join the Eurozone on independence.

[Helsinkian]

tl;dr version:
Scotland cannot join the Eurozone on independence.

Right, but eventually an independent Scotland would have to join it. It might be 15 or 20 or 30 years after joining the EU but ultimately it would happen.

Let's remember that most of the Brussels elite firmly believe in the idea of a federal pan-European state. They are willing to strive for that goal through small incremental acts of increasing uniformity and centralisation but they have no doubt of what the endgame is. In such a future there is no room for heterogeneity among member states.

[Clyde1998]

tl;dr version:
Scotland cannot join the Eurozone on independence.

Right, but eventually an independent Scotland would have to join it. It might be 15 or 20 or 30 years after joining the EU but ultimately it would happen.

Let's remember that most of the Brussels elite firmly believe in the idea of a federal pan-European state. They are willing to strive for that goal through small incremental acts of increasing uniformity and centralisation but they have no doubt of what the endgame is. In such a future there is no room for heterogeneity among member states.

If Scotland never joins the ERM2, we will never join the Eurozone.

Joining the ERM2 is voluntary, therefore joining the Eurozone is voluntary:

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[Helsinkian]

Yeah, I'm sure the Brussels federalists would not pressure you in any way on that issue. Especially when they hold pretty much all the cards in the negotiations.

The eurofederalists, who are a majority among the Brussels technocrats, have for a long time been annoyed at the UK's unwillingness to follow the other member states in furthering the European integration. With UK's exit, the EU elites see a chance for greater integration for the member states remaining in the union (just look at Guy Verhofstadt's comments). That means greater homogeneity and less opt-outs.

[ag]

Yeah, I'm sure the Brussels federalists would not pressure you in any way on that issue. Especially when they hold pretty much all the cards in the negotiations.

The eurofederalists, who are a majority among the Brussels technocrats, have for a long time been annoyed at the UK's unwillingness to follow the other member states in furthering the European integration. With UK's exit, the EU elites see a chance for greater integration for the member states remaining in the union (just look at Guy Verhofstadt's comments). That means greater homogeneity and less opt-outs.

Scotland will, voluntarily and without any argument sign the promise to enter euro - this is not even a question. The question is, whether it would be actually allowed to join the euro any time soon, given that it is another weakish peripheral economy with fundamentals outside the range. Given recent experiences, chances are no exceptions will be made for them. So, that would mean that they will, actually, keep Scottish pound for quite a few years, whether they want it or not. "Eurofederalists" (whom you, clearly, do not know in person) will not want to have another Portugal on their hands. So, there will be no opt-outs, Scotland will promise to enter euro, and when and whether it is actually entering is going to be decided years, if not decades, later.

[IceAgeComing]

Yeah, I'm sure the Brussels federalists would not pressure you in any way on that issue. Especially when they hold pretty much all the cards in the negotiations.

They don't seem to be pushing the Czechs that hard over it; and they've been in the EU for twelve years now.  Hell they've had a government that's supported adopting the Euro and have met all but two of the criteria (they've not met the "Compatibility of Legislation" one nor the "Be in the ERMII for two years" one, probably the easiest two to meet) but they continue to drag their feet.  The new policy from the government seems to be "if re-elected next year, we'll set a deadline of 2020 to agree a roadmap towards adopting the Euro" and rumblings about a non-binding referendum which to me suggests that they aren't confident that they'll be in the position to adopt the Euro possibly for another ten years - doesn't sound like something that a government with significant pressure from the EU would do.  In Poland the złoty is in the constitution so even if they wanted to adopt the Euro tomorrow they'd have to amend it, and that's something that's going to be very hard to do for a long time, if ever - provided that they elect a pro-European government again which you'd assume that they would at some point...

Hell, the Swedes have the position that I'd like to see any Scottish government adopt: stressing that ERM II membership is voluntary and that entering it (and thus starting the process of adopting the Euro) would be contingent on a referendum.  They're one of the countries that's technically been compelled to adopt the Euro since it was created but they haven't, don't want to and the EU have done nothing to force them.  To me that suggests that an independent Scotland would have no issue kicking the Euro can down the road until there's the political and popular will to adopt it - the currency union with the rest of the UK would have made EU membership a lot, lot more complicated but I don't think that's on the table anymore, plus it was always a dumb idea!

[Clyde1998]

The currency union with the rest of the UK would have made EU membership a lot, lot more complicated but I don't think that's on the table anymore, plus it was always a dumb idea!

I agree with you that it was a stupid idea - that I think lost the referendum for Yes last time.

I think having an independent currency pegged to the pound in the short term (at least), would work much better. If it's pegged 1:1 with Sterling, then we could continue to accept Bank of England bank notes in Scotland, as well.

[mgop]

Good riddance. England just kill two birds with one stone.

[parochial boy]

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From the Guardian.

So, big if, if a referendum is to happen, it will probably be within the next year. Time for the current emotion to die down? Or for fears to get worse as the full on implications of Brexit manifest themselves?

[Tetro Kornbluth]

One issue is that for a referendum to happen it needs the consent of Westminster. Can they obtain that? They got it in 2011 after the SNP majority at Holyrood, but that was when 'consensus' (you idiots never learn) stated that independence would be defeated 70-30 and a referendum would bury the issue in the ground for good. Might be more difficult this time....

[Clyde1998]

One issue is that for a referendum to happen it needs the consent of Westminster. Can they obtain that? They got it in 2011 after the SNP majority at Holyrood, but that was when 'consensus' (you idiots never learn) stated that independence would be defeated 70-30 and a referendum would bury the issue in the ground for good. Might be more difficult this time....

The Scottish Parliament is able to hold a "consultative referendum" (as opposed to a binding referendum) without Westminster's consent, as far as I understand it. If turnout in that referendum is very high (80%+) or the Yes vote is over 50% of the electorate, I think it would be very difficult for Westminster to ignore the result - especially if institutions, such as the EU, recognise the result.

[politicallefty]

The question I have is what if Scotland decides to go ahead with another referendum in the near future and Westminster refuses to recognize it (particularly if it's something like a mirror image of the Quebec sovereignty vote in 1995)? From what I've read, there's a lot of debate on what would have happened had Quebec voted Oui in 1995 and tried to unilaterally declare independence. Washington would have been very reluctant to go against Ottawa, while Paris on the other hand was ready to accept the result in full. Even on an issue like this, so long as there is at least relatively sane leadership on both sides (i.e. not Donald Trump and not Boris Johnson), I cannot ever imagine any daylight between Washington and London. I realize that's only one international relationship (albeit probably the most important), but in the event Westminster refuses to recognize a possible Yes vote in another Scottish referendum, it seems like a pretty nasty situation to deal with for many countries.

I see others have basically posed that question, but I'd like to hear answers on this from both sides. If Westminster refuses to recognize Scottish independence, there's no way Washington will recognize it. On top of that, there won't be recognition from Ottawa or Beijing or Madrid or most other countries in the world.

[ag]

The question I have is what if Scotland decides to go ahead with another referendum in the near future and Westminster refuses to recognize it (particularly if it's something like a mirror image of the Quebec sovereignty vote in 1995)? From what I've read, there's a lot of debate on what would have happened had Quebec voted Oui in 1995 and tried to unilaterally declare independence. Washington would have been very reluctant to go against Ottawa, while Paris on the other hand was ready to accept the result in full. Even on an issue like this, so long as there is at least relatively sane leadership on both sides (i.e. not Donald Trump and not Boris Johnson), I cannot ever imagine any daylight between Washington and London. I realize that's only one international relationship (albeit probably the most important), but in the event Westminster refuses to recognize a possible Yes vote in another Scottish referendum, it seems like a pretty nasty situation to deal with for many countries.

I see others have basically posed that question, but I'd like to hear answers on this from both sides. If Westminster refuses to recognize Scottish independence, there's no way Washington will recognize it. On top of that, there won't be recognition from Ottawa or Beijing or Madrid or most other countries in the world.

Remember, there is a very large chance that SNP may hold the balance in Westminster following any close election: 50+ MPs is a lot. Yes, that might take a bit more time, especially if May gets to be the PM and refuses to have a new election till 2020. But whenever that happens, SNP will simply prevent establishment of a government in the UK until it gets its referendum.

I mean, Spain has gotten ungovernable with Catalanist parties being split and holding a smaller proportion of the parliament. United SNP in its current position will likely make UK ungovernable before long.

[vileplume]

The question I have is what if Scotland decides to go ahead with another referendum in the near future and Westminster refuses to recognize it (particularly if it's something like a mirror image of the Quebec sovereignty vote in 1995)? From what I've read, there's a lot of debate on what would have happened had Quebec voted Oui in 1995 and tried to unilaterally declare independence. Washington would have been very reluctant to go against Ottawa, while Paris on the other hand was ready to accept the result in full. Even on an issue like this, so long as there is at least relatively sane leadership on both sides (i.e. not Donald Trump and not Boris Johnson), I cannot ever imagine any daylight between Washington and London. I realize that's only one international relationship (albeit probably the most important), but in the event Westminster refuses to recognize a possible Yes vote in another Scottish referendum, it seems like a pretty nasty situation to deal with for many countries.

I see others have basically posed that question, but I'd like to hear answers on this from both sides. If Westminster refuses to recognize Scottish independence, there's no way Washington will recognize it. On top of that, there won't be recognition from Ottawa or Beijing or Madrid or most other countries in the world.

Remember, there is a very large chance that SNP may hold the balance in Westminster following any close election: 50+ MPs is a lot. Yes, that might take a bit more time, especially if May gets to be the PM and refuses to have a new election till 2020. But whenever that happens, SNP will simply prevent establishment of a government in the UK until it gets its referendum.

I mean, Spain has gotten ungovernable with Catalanist parties being split and holding a smaller proportion of the parliament. United SNP in its current position will likely make UK ungovernable before long.

That is highly unlikely to be true. If an election was held in the few months after the new Tory prime minister actually takes office (which if there is one it will be then) then it is highly likely that you would be looking at a substantially increased Tory majority as Labour would have no time to get themselves out of the very deep abyss into which they are sinking. For example in this scenario Labour's most vulnerable seats vs the Tories like Barrow and Furness and Newcastle under Lyme (and a slew of others) are probably dead in the water. Of course if the next election is 2020 then all bets are off, but seen as you think that Scotland will be independent by then anyway then it would be impossible for the SNP to hold the balance of power.

Also with all due respect AG a lot of things you treat as certainties (in many different posts) are what you want to happen regardless of whether it is actually the most likely outcome or not. For example the currency issue is still a major problem for the Scottish independence campaign (as is the price of oil) as joining the Euro would be likely to go down like a bucket of cold sick with the Scottish electorate .

[Beezer]

Latest YouGov poll has the "no" side ahead:





https://yougov.co.uk/news/2016/07/30/brexit-fails-boost-support-scottish-independence/

[parochial boy]

A return to pre-rBrexit polling is probably not overly surprising now that the initial emotion has died down somewhat.

The question is, where god the polls go if the Brexit negotiations go badly, i.e., loss of single market access, free movement etc...

Or perhaps, more importantly, the dual possibility of a post-Brexit recession starting to really bite, combined with more reactionary English nationalist policies being put in place by the Tories to try and appease that particular wing of the party.

[Beezer]

Sturgeon shelves plan for quick second Scottish independence referendum

Nicola Sturgeon has shelved plans for a quick second referendum on Scottish independence after dire spending figures and a fall in public support for leaving the UK.

The first minister told Holyrood on Tuesday that her government only planned to issue a consultation on a draft referendum bill – a measure which falls short of tabling new legislation in this year’s programme for government.

Two months after telling reporters a referendum was “highly likely” within the next two years, she told MSPs that that bill would now only be introduced if she believed it was the best option for Scotland.

Her officials later said that consultation process could start at some time in the next year, with no target date in mind for its launch or its conclusion. Sturgeon’s official legislative timetable, the programme for government, described the referendum as an option and not as a goal.

...

http://www.theguardian.com/politics/2016/sep/06/nicola-sturgeon-shelves-quick-second-scottish-independence-referendum-bill

[Helsinkian]

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http://www.politico.eu/article/is-scotland-heading-for-another-referendum-brexit-nicola-sturgeon-uk/?utm_content=buffer6e476&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

There is obviously the case of Quebec as a warning example: two lost referendums in succession can strike a major blow against the cause.

[Beezer]

Guess it's on again.

SNP's Nicola Sturgeon announces new independence referendum bill

A consultation gets under way next week on plans for a second Scottish independence referendum, the SNP's Nicola Sturgeon has confirmed.

She told the party's Glasgow conference that an Independence Referendum Bill would be published next week.

http://www.bbc.com/news/uk-scotland-scotland-politics-37634338