A Vow Fulfilled; Time to Move Forward

With the passage of the Scotland Bill, the Scottish Parliament is set to become a very powerful institution within the constitutional structure of Britain. Image Credit:  Kim Traynor  via  Wikimedia Commons   CC

With the passage of the Scotland Bill, the Scottish Parliament is set to become a very powerful institution within the constitutional structure of Britain. Image Credit: Kim Traynor via Wikimedia Commons CC

     Two days before Scotland voted on whether to secede from the United Kingdom, the Daily Record published as its headline “THE VOW”. In it was a statement jointly signed by the three main UK political party leaders at the time – Prime Minister David Cameron (Conservative), Deputy Prime Minister Nick Clegg (Liberal Democrats), and Opposition Leader Ed Miliband (Labour) – which committed them to legislating for “extensive new powers” for the Scottish Parliament at Holyrood if the people of Scotland voted to remain part of the Union.

     This promise – brought on by the newspaper, and brokered by former Prime Minister Gordon Brown and Scottish Labour – also guaranteed that the Scottish Parliament would become a permanent fixture the British constitution, and stated “categorically” that with the continuation of the Barnett Formula and “powers of the Scottish Parliament to raise revenue”, Holyrood would have the “final say on how much would be spent on the [National Health Service]” in Scotland.

     Two days later, the people voted decisively to reject separation and to keep the United Kingdom together. Since then, the “Vow” has gained an almost mythic status – as though it was our generation’s equivalent of Magna Carta (whose 700th anniversary was celebrated this year), the Bill of Rights, or the Declaration of Arbroath – because of the belief that it was that declaration “wot won it” for the pro-Union campaign. After all, the opinion polls, which had the pro-Union vote with healthy leads for most of two-and-a-half year long campaign, had begun to markedly narrow in August and culminated with the Sunday Times/YouGov poll which showed the pro-independence vote (barely) ahead for the first time on September 7th.

     For many Nationalists, the Vow was nothing more than a gimmick which revealed the desperation of the pro-Union campaign in the waning days of the referendum to turn the numbers around (especially among undecided voters) and win on September 18th.

     In my opinion, the Vow itself was really a singular restatement of previous pledges made over the course of the campaign that Scotland could have the best of both worlds: a strengthened Scottish Parliament with the ability to make more decisions on behalf of the Scottish people, but within safety and stability of the United Kingdom – hence the Vow’s declaration that voting to retain the Union would “deliver faster, safer, and better change than separation.”

     However, the reality is that after September 7th, the polls either had a tie or a pro-Union lead before announcement of the Vow, and analytical research and surveys since the referendum have shown that the Vow had little to no effect on the final outcome.

     Nevertheless, a vow is a vow, and upon the outcome of the vote, David Cameron appointed a commission led by Lord Smith of Kelvin to negotiate the devolution of more powers among the five political parties of Scotland – Labour, the Conservatives, the Liberal Democrats, the Green Party, and the SNP. What emerged was an agreement signed off by all of the parties which became the basis for the current Scotland Bill, which at the UK Parliament at Westminster, completed its final passage in the House of Commons this past Monday, and heads to the House of Lords for further scrutiny.

     Its main provisions include the ability of Holyrood to set income tax rates and bands from April 2017, keep half of the taxes generated through VAT in Scotland, and have control over Air Passenger Duty (aka, the "tourism tax"). Holyrood will also have enhanced authority over welfare, such as control over Disability Living Allowance and elements of Employment Support and Universal Credit. It will have the ability to top-up existing benefits (including tax credits which may be cut by the UK Government) as well as to create new ones. Through these powers, the welfare system in Scotland can be changed and Holyrood will have the ability to tax accordingly in order to pay for such changes here, or in other areas that have been devolved.

     In addition, management of most of the Crown Estate in Scotland will be handed over to Holyrood. It will have increased borrowing powers to fund large capital projects, legislative control over onshore oil and gas extraction, and – more controversially – abortion law. Furthermore, the Scottish Parliament and Scottish Government will be recognized as permanent features of the UK’s constitutional structure, with provisions for them to be abolished only through a referendum.

     Taken together with the powers it currently has and the powers already to be phased-in next year from the 2012 Scotland Act, Holyrood will become quite powerful – indeed, one of the most powerful sub-central parliaments in the world, with the ability to decide on policy matters which will affect the day-to-day lives of ordinary Scots.

     The tax powers alone are no joke, and the BBC has calculated that with the devolution of the aforementioned taxes combined with the other taxes Holyrood controls (or will soon control), revenues will stand at £19.3 billion, which represents nearly 60% of the 2012-2013 Scottish budget (which is the latest fiscal year for which there is a known outturn). Even with the 2015-2016 draft budget standing at £37.4 billion, this amount of revenue raised by Holyrood would still amount to a majority (51%) of that budget.

     Earlier this year in the UK Government’s command paper on implementing the Smith Agreement noted the extent to which sub-central governments within OECD (Organization for Economic Co-operation and Development) countries like the UK have responsibility for spending and taxation:

“the tax and spending powers of sub central governments varies considerably across OECD countries. The OECD average for sub-central government responsibilities is c30 per cent of spending and c20 per cent of tax, but this ranges from below 10 per cent to above 50 per cent.2 As a result of the Smith Commission Agreement, the Scottish Parliament will control around 60 per cent of spending in Scotland and retain around 40 per cent of Scottish tax. This will therefore make the Scottish Government one of the most powerful sub-central governments in the OECD, just behind the Canadian provinces and Swiss cantons. Importantly, it will therefore give the Scottish Government substantial choices in relation to levels of tax and spending in Scotland.”

     Of course, the how much is actually raised in tax and how much is spent will now be largely be determined by the party that controls Holyrood, which for the foreseeable future is the SNP.

     But the SNP, which once dismissed the Vow as a last-minute gimmick, now complains that it has not been fulfilled via the Scotland Bill. Indeed, it has been complaining from day one, and basically set up the Smith Commission for failure by demanding full fiscal autonomy (aka devo-max) for Holyrood, which would have resulted in independence-in-all-but-name and a serious financial cost for Scotland. It signed off on the Smith Agreement, but kept on whining about how it did not go far enough with more powers.

     This attitude kept on going all the way through to final passage on Monday night, where their 55 MP’s in the House of Commons not only moaned about the bill itself, but the process under which it was passed – saying that the six hours allotted for debating the bill and its amendments was too little time. On Twitter, their supporters complained about the lack of MP’s in the chamber (though as Iain Martin said on CapX, “imagine the SNP’s anger if English Tories had turned up in huge numbers to debate”), and there was more complaining about the traditional voting methods at Westminster.

     They griped about their amendments being shot down, including ones to devolve control over tax credits to Holyrood, as well as to give it the sole authority to call a future referendum on separation. Interestingly however, the party failed to call a vote on their own amendment for full fiscal autonomy.

     In all, over 200 amendments were lodged, including 80 by the government for the purpose of clarifying and strengthening the bill to allay concerns. But Pete Wishart angrily stood before the House to claim that the whole process had shown “gross disrespect” to the debate over Scotland’s future and felt as though the country had been given an “almighty slap in the face and told to just get on with it.” In response, Scottish Secretary David Mundell said that Wishart was “always angry at something”.

     He further noted that Wishart pulled “this sort of stunt” every time the bill was being discussed, but asserted that his anger was not directed him or the House of Commons, but “directed at the people of Scotland because they voted decisively remain part of the United Kingdom, and that is something he just cannot accept.”

     Indeed, it sometimes feels as though the SNP has not accepted the results from last year – with them keeping the independence conversation alive and changing their tune from the referendum being a once in a generation (or lifetime) event, to discussing the possibility of having another one in a vastly shorter time span. Even with the Scotland Bill, some members of party have banged on about Westminster “betrayal” for it not going far enough and believing that there should be another referendum soon.

     All this before actually getting on with the new powers and seeing what Holyrood can do with those powers for Scotland within the United Kingdom, which is what the people expect.

     David Cameron and David Mundell have expressed their belief that the Vow has been fulfilled. So has Labour’s Shadow Scottish Secretary Ian Murray, who said that “significant tax powers mean that new choices will be available to the Scottish government and new welfare powers provide the opportunity to create a social security system fit for the needs of [Scotland].”

     At the end of this week, Lord Smith of Kelvin added his voice as being in agreement that the Scotland Bill “honoured what the five parties agreed” and also declared that his commission’s recommendations on welfare powers had been “delivered in full.” Writing for the Daily Record, Lord Smith expressed praise for the politicians who were on the commission and came to an agreement, which had gone farther than some wanted, and not far enough for others. Nevertheless they reached a deal and got on with the task of putting it into effect – something he hailed as a “significant achievement” in terms of going through the political processes, which he said “was never going to be easy” given the politics and the complexities of the law.

     Gordon Brown has given his endorsement of the bill as having delivered the Vow, and the Daily Record – which published the Vow and has campaigned on its behalf – is in agreement that with the Scotland Bill due to the Vow, “the powers of future Scottish governments will be greatly enhanced”, while criticizing the SNP for their constant moaning, complaining, and “behaving like they have been handed a soiled nappy” as opposed to celebrating the arrival of the new powers.

     Meanwhile, Stephen Daisley of STV has noted that he was skeptical of the Vow, but now concedes that the Scotland Bill “makes good” on the promise of “substantial new powers” for Holyrood – a “fact no Nationalist demagogue can inveigh away.” He also took aim at the SNP for using the Vow as a means to stoke anger and peddle grievance – quipping that “if Westminster found a cure for the common cold, they would complain it was putting hard-working Scottish pharmacists out of business.”

     However, Daisley agreed with Nationalist claims that the Vow failed to deliver on “home rule” for Scotland. This is perhaps one of the more contentious issues concerning the shaping of the new devolution settlement, for while the Vow said nothing about home rule and was “cautiously worded”, Gordon Brown did mention it in his last minute interventions as the campaign came to a close.

     Daisley points out that Brown was seen as “the savior of the UK” because of the respect that he commanded as a Labour “big beast” amongst the sort of left-leaning voters thought to be wavering on whether to vote for the Union or independence – people who would listen to him when they would not listen to David Cameron, or even Alistair Darling or Ed Miliband. So when the former prime minister unleashed his soaring oratory in a speech on the eve of the referendum, he was celebrated by pro-Union activists of all persuasions – not least for its colorful references to the virtues of British solidarity and the UK’s historic achievements, which depended on the participation (and in many cases, sacrifice) of people from throughout the UK regardless of the home nation from which they came.

     However, Brown also said – either in that speech, or in the days preceding – that Scotland could expect "nothing less than a modern form of Scottish Home Rule”, something "quite close to something near to federalism” if it voted to maintain the Union and reject separation. Driving the point home, he further stated that “the United Kingdom will move as close to federalism as we can go in a country where one nation accounts for 80% of the population.”

     These commitments, claims Daisley, were “more heartfelt oath” than the Vow, and have not been honored by the pro-Union parties. He mentioned some of the powers still reserved at the UK level: industrial relations, broadcasting, the minimum wage, the rail network, equalities legislation, “full oversight of the Crown Estate”, and the ability to administer tax credits (and not just to top them up). Therefore, he says, the Nationalists are not engaging in political spin when they say the Scotland Bill falls short of their expectations for federalism/home rule, and the failure to implement this means that the pro-Union cause is now “constitutionally barren”, with only economics and sentiment to carry it through another vote (which, in his view, may not be enough).

     However, if this sounds like a whiff of Westminster “betrayal”, it is important to understand that there were two parts to the Vow and the Gordon Brown’s home rule/federalism statements.

     With regard to the Vow, it did indeed make a promise for “extensive new powers” for Holyrood, that Holyrood would have the final say over the Scottish NHS, and that Holyrood would be permanent, which is the part the SNP like to quote so often. However, it also said that “the UK exists to ensure opportunity and security for all by sharing our resources…to secure the defence, prosperity, and welfare of every citizen”, and partly to this end, the Vow called for “the continuation of the Barnett allocation for resources.” There was also a line about these “principles and values” underpinning the UK’s “future as a country.” In the extended clauses of the Vow, Guarantee Two states in part that:

“the modern purpose of the Union is to ensure opportunity and security by pooling and sharing our resources equitably for our defence, prosperity and the social and economic welfare of every citizen, including through UK pensions and UK funding of healthcare.”

     In other words, part of the Vow was about stating that with further devolution, Scotland would still be very much part of the United Kingdom and therefore still be part of the UK’s system of pooling and sharing for the benefit people not just in Scotland, but throughout the UK as a whole – something that may have been difficult to achieve with what the Nationalists wanted short of independence, which was devo-max/full fiscal autonomy (the implications of which are helpfully explained here by businessman and blogger Kevin Hague).

     This leads to Gordon Brown’s dramatic interventions late in the campaign, for while he did make statements about achieving home rule and federalism, it is also clear that there were limits. Why else would have said “near to federalism” or that the UK would move as “close to federalism as we can go in a country where one nation accounts for 80% of the population”? Was it because he was determined to keep Scotland in “its place”, or more likely because he knew – as a former chancellor and prime minister – that there is a point at which devolution to one part of the UK makes the country as a whole ineffective, ungovernable, and constitutionally unstable to the detriment of everyone, including Scots?

     Is it possible that we have gotten to that point – where devolution can be had without emasculating the Union and the pooling and sharing benefits of being part of a larger country? Yes, I know “pooling and sharing” is becoming a cliche and may ring hollow for some people, but that was a key reason for keeping the United Kingdom together – more so than the “Vow” because of economic pragmatism, as well as the safety and stability of the Union. The new settlement is an attempt to preserve that stability while also making the Union more flexible with further devolution and the ability for Holyrood to make more decisions for Scotland.

     It may well be true, as Daisley wrote, that some politicians “were dragged kicking and screaming by the Record and its editor Murray Foote” in their resistance to parting with the powers they eventually devolved, but it is not as though they were hell-bent on greedily keeping those powers only for themselves, and away from Scots. They, along with many Scots, may have been concerned that going too far would have had adverse effects for Scottish representation in the House of Commons (especially without a solution for the West Lothian Question). There was probably also a fear that the further devolution of power would hollow out the UK by eroding the critical fiscal and political bonds that keep the country together.

     In this light, it is important to note that former Prime Minister Brown spoke of a “stronger Scottish Parliament within the United Kingdom” (not half-way in), and that the total sum of the guarantee’s made by the pro-Union parties paved the way to a future with “a great Scotland as a driving, successful and vibrant nation playing its full part in Great Britain.”

     This, I believe, was as much of a heartfelt declaration as those statements relating to more powers. They speak to the pragmatic belief that the benefits of staying in the UK outweigh the costs, and that Scotland can (as it always has) play a significant role in shaping it. In short, it appears that Gordon Brown believes that Holyrood should be more powerful within the UK and that the UK should be able to work as a country for all of its constituent parts.

     This situation is probably better explained in section 2.1.1 of the command paper, which stated:

“The United Kingdom (UK) has a strong and successful economy because currency and monetary policy, taxation, spending and financial stability policies are coordinated across the UK. If one part of the UK faces an economic challenge – from a fall in tax revenues, pressure on public services or a temporary increase in unemployment – the impact and the cost is shared across all parts of the UK. This is achieved by the UK Government pooling and redistributing tax revenues across the UK to ensure sustainable and secure levels of spending on public services. The implementation of the Smith Commission Agreement, including an updated fiscal framework, must therefore underpin Scotland’s devolution settlement while retaining the existing benefits of the UK.”

     On this last point about an updated fiscal framework, Lord Smith has said that this is the “final interlocking piece of the jigsaw” of the agreement reached by the parties last year. With the ability of Holyrood to set several taxes in a few years, the new fiscal agreement needs to take that into account so that it can be fair for Scotland and the rest of the UK. Negotiations are ongoing, and Lord Smith expects that a framework will be agreed to, for it underpins Scotland’s finances, and therefore is vital for everything else to work, including the use of the new powers.

     Aside from these matters - which may not be settled until early next year - he wrote that the “question now turns to how Scotland’s parties choose to use these powers.” On this point, the pro-Union parties need to begin a massive information campaign to educate the people on what is going to be devolved and how they are looking forward to using those powers for the benefit of the people of Scotland - with an emphasis on moving away from the SNP's constitutional/separatist obsessions, and explaining how they intend to do a better job on bread-and-butter issues such as health, education, and policing than the SNP.

     Indeed, if the SNP's real gripe has been that the British constitution does not work in the interest in Scotland, then after going through all this constitutional rearranging, it should at least try out the new powers that are coming its way and see the results.

     But of course, it cannot do that, because using those new powers may demonstrate that the constitutional arrangements work and therefore deprive them of grievances with which to pick fights with big, bad (evil) Westminster. It may also demonstrate the challenges of having to make tough decisions in the face of economic reality, such as deciding the level of income tax and deciding between winners and losers, which inevitably happens and causes governing parties to lose popularity (i.e,. the reason they moan about “fiscal traps”). Of course, it will be daft to assume that Westminster-Holyrood rows will cease, but as the Daily Record's Torcuil Crichton noted in his break-down of the Scotland Bill, "having responsibility for making difficult tax decisions could change how voters choose their MSPs at Holyrood."

     Either way, it distracts from the independence cause, and the griping shows that the SNP has no interest in making the UK work in some form or fashion. The only, overriding thing that matters is separation, and they need the grievance narrative – the sense of Scotland being treated badly because well...its Scotland – in order to carry that ambition forward, which is why the SNP cannot really be a party of government because its focused on complaining about what powers it does not have, rather than getting on with the powers it already has, and will soon have.

     In this sense, the SNP is not "stronger for Scotland" so much as it is stronger for itself and for the separatist movement, which are not the same as Scotland, and as Iain Martin explains, it may become “apparent to reasonable people that complaining about powers always was cover, created by a party elite obsessed with breaking up the UK.”

     For that matter, “more powers for Scotland” is a bit of a misnomer in my opinion, because Scotland has exercised powers over taxation, welfare, health, and other areas in conjunction with the rest of the UK. The powers were exercised at the UK level and decided upon by politicians representing the people of the UK as a whole for the UK as a whole. The only difference in relation to Scotland is that instead of these matters being decided by and for the UK as a whole at Westminster, they will now be decided by and for Scotland alone at Holyrood.

     In other words, power is not being transferred to Scotland or the Scottish people (who have had these powers anyway with the rest of the UK) so much as it is being transferred from one central authority (Westminster) to another central authority (Holyrood). If anything, as Lord Smith said, there needs to be “improved parliamentary oversight in the Scottish Parliament” and an effort to “make sure decisions are properly scrutinised.”

     Going forward, if the UK is moving in the direction of federalism, there must still be a central authority which is still responsible for governing the UK as a whole. Under such a system, there will be some exclusive responsibilities for a federal UK government, exclusive responsibilities for the sub-central administrations, and shared responsibilities between each level of government.

     With the passage of the Scotland Bill and it becoming an Act of Parliament upon receiving Royal Assent, some shared responsibilities will be born out in the arena of welfare, where the SNP complained that ministers at the Department of Work and Pensions (DWP) could “veto” changes to benefits that Scottish ministers want, despite Holyrood being given £2.5 billion worth of new welfare powers. But, as was said in the Record, DWP ministers in Whitehall “explained that under a joint system, with benefits still administered by the DWP, the agreement of both governments would be needed for practical reasons.” Among the 80 amendments made to the bill on Monday were ones designed to ensure that language regarding the two governments working together were not construed as a “veto” against Holyrood setting policy.

     The Bill also gives Holyrood a formal consultative role in reserved matters such as broadcasting (including the BBC), telecommunications, postal affairs, and energy regulation. In foreign affairs, Scottish ministers will be able to speak on behalf of the UK in EU discussions on issues like fishing and work in conjunction with UK ministers on the UK’s position in such matters. Furthermore, the Bill itself has to be given legislative consent by Holyrood, and on this point, the SNP have indicated that they may refuse consent if Holyrood "loses out financially from the budget settlement" via the updated fiscal framework. With so much riding on the line however, it is in the best interest for everyone to come to an agreement on this.

     Indeed, Lord Smith commented in his Daily Record article that there must be “a continuation of efforts to improve the relationship between the Scottish and UK Governments”, for the constitutional settlement depends on the two working well in everyone’s best interest. This is similar to the interaction between the federal government and state governments in the United States, and may mark another point on the UK’s road to federalism.

     However at this point, with the Vow having been fulfilled (and for further perspective on it, please read this piece by Fraser Whyte), any further devolution and/or constitutional change really needs to be done a UK national basis. The constitution may well continue to evolve as it always has, but needs to be done in a more coordinated fashion, such as at a constitutional convention, where the interests of the UK as a whole and its constituent parts can be well-considered. Perhaps this can lead to a written constitution or at least something more durable, comprehensive, and lasting than the current set of ad hoc and piecemeal arrangements, which include the controversial EVEL (which I have written about here and here) and devolution to English cities and regions.

     In 1787, few (if any) of the signers of the US Constitution were satisfied with the document they signed, and their feelings toward it were probably best summed up by Benjamin Franklin when he said: "I consent to this Constitution because I expect no better, and because I am not sure it is not the best."

     As it was, they went on to make the Constitution work, and over 200 years later, we the American people have strived to make the Constitution work for all us. It is in many ways, still an imperfect document, but nonetheless still aims to create a more perfect Union, while standing the test of time as the backbone of American governance and the guarantor of our democracy.

     In Britain, though more changes may be in store down the line, the British people – whoever they are and wherever they live – should at least try to make their constitutional arrangements work, and focus on achieving better things for the greater good.