Beware of a new Brown Intervention

by Jim Sillars

Prepare for Gordon Brown coming back with another pre-emptive strike at independence, this time with Federalism. He’s written an article for the Daily Record, made a big speech to a think tank in London (broadcast on the Parliament channel), and has been dutifully, if unthinkingly, followed by Scottish Labour leader Kezia Dugdale.

The Brown and Dugdale idea has no traction with the public at present, but this is a runner. Yes voters should anticipate the next referendum ballot paper pitting federalism against independence. It will be seductive. Even Kevin Pringle, who commanded the SNP media machine for many years, wrote in his Sunday Times column in February “The multinational nature of the UK should be enshrined in a written constitution – including a guaranteed say for Scotland, Wales and Northern Ireland in major UK-wide decisions, English home rule, and changing the name and composition of the Bank of England to ensure it represents all parts of the country. That’s the kind of modernised Union that might last. I’d settle for it myself, but it seems as distant as the pamphleteering of the 18th. century.” See what I mean? Brown thinks federalism beats independence by 80-20. There have been no polls to say he is right, or wrong.

On the face of it, a ‘federalist’ solution looks attractive, doing away with the currency problem, nationality, defence, shipbuilding jobs, security, the North Sea, the EU dimension, NATO - the issues that dominated the 2014 referendum. But as is often the case, appearances can be deceptive, sometimes, very deceptive. Federalism raises many issues that, in comparison with independence, are far from advantageous.

Brown’s late intervention in 2014 was spun as an offer of many more powers to Holyrood. In reality it was vague on detail, leaving the blanks to be filled in by a Unionist majority in the Smith Commission. David Mundell claims the new tax raising powers are greater than any given before. True: but as we had none of practical use and relied entirely on a block grant, that isn’t saying much. The result of the Vow is an income tax trap; which Derek MacKay Derek MacKay has just walked into.

Is it likely that the Federal solution will be on the next ballot paper? There are solid reasons to believe so, based on the precedent that Alex Salmond sought to put Devo Max on the 2014 ballot, but was rejected by Cameron. This time the Scottish Government may not want federalism as a choice, but may be required to accept it as a condition of Westminster agreeing to a referendum. We can be sure that Brown, and the Labour Party, will press for that.

The Scottish Government’s ability to resist such a demand requires political strength which it does not have. The First Minister, in The Times of 28 February was strident in her claim to have a mandate for a referendum, citing the fact that in 2016 the SNP won more votes and seats than Labour and Tory combined. That is a highly selective definition of a mandate, given that the SNP lost six seats, and is now a minority government.

It may be argued, and it is something I support, that combining the SNP and Greens in Holyrood, in a demand for a referendum should carry the day, given that the Scottish Parliament is the indisputable forum of the nation. But that is not the same as the mandate Nicola claims to have obtained on her own. That weaker hand may require the compromise that federalism be added to the referendum question.

Now to return to Brown & Dugdale. There should be, according to Kezia Dugdale, not a written constitution, but a new Act of Union brought forth by a codified Act of the Westminster Parliament. What exactly does that mean?

Does it mean that this Act of Union will have an exceptional status almost equal to a treaty in international law, and lodged at the United Nations? That it will constitutionally entrench all powers given to the Scottish Parliament, making repeal of the Act or any part of it impossible except by the express wish of the sovereign people of Scotland in a binding referendum? If so, and nothing less would be acceptable, then the bedrock of the UK constitution – the sovereignty of the Westminster Parliament, with the collorarly that no Parliament can bind its successors – would no longer stand, at least in respect of that particular Act. Will the English swallow that? Will the British State acquiesce in the loss of a cornerstone of the constitution it has lauded for centuries?

Let us assume the English will swallow this new constitutional framework. So, what is to be the division of powers between the ‘Federal’ Westminster and the ‘sub- state’ Scotland?

Will it transfer to Scotland powers reserved to Westminster in Schedule 5 of the 1998 Scotland Act, minus currency, defence and foreign affairs? That appears a relatively easy division, with Scotland paying a levy to the Westminster Government for our share of defence and foreign affairs. But it is not that simple.
It is here that Brown & Dugdale have to come clean and be specific. For example, The UK will remain a sovereign state, and as such the only one in membership of the UN and its agencies, in WTO and other international organisations that determine trade rules, technical, service and safety standards. There are many of these. So, it will not just be currency, defence and foreign affairs kept at Westminster.

There are pertinent questions to be asked and answered in an all-UK context. Given that people will continue to move freely around the UK, will we want an all-UK basic state pension, and UK regulation of private pensions? As the Scottish financial sector has close links to the London one, will oversight and legislative control rest at Westminster rather than Edinburgh? What of the welfare state provisions? Will Scotland be free to set its own kind and level of benefits, or will there be a basic UK level which can be topped up by a Scottish Parliament?

The answers to those questions lead immediately to taxation powers. If there are to be all-UK benefits and services, then there will have to be an all- UK level of ‘federal’ taxes, alongside Scottish taxes. What taxes will be on which level? Income tax is the most obvious, but there are other taxes - VAT, corporation, inheritance, alcohol, fuel, vehicle, north sea oil, national insurance? Does Westminster keep full control of these, are they transferred to Holyrood, or transferred only in part? Can Brown.-Dugdale tell us the answers?

Then there are other policy areas that have effect upon economic performance and society. Will the Scottish Parliament have separate powers and jurisdiction over fisheries in Scottish waters, employment law, trade union law, minimum and living wage levels, company law, allocation of science research, Scottish Government nominees on the Board of the Bank of England and on its the Monetary Policy Committee?

Brown has argued for an all British Isles constitutional commission to examine the concept of federalism as applicable to all parts of the UK. The chances of splitting up England into effective units that could exercise the same powers as we would expect for the Scottish Parliament, or even lesser legislative powers, is a non-starter. There is no appetite for that in the south. So, to be real, any federal policy must be between what the 1998 Act describes as the Kingdom of Scotland and the Kingdom of England. In case this upsets the Welsh, their unhappy historical fact is that Wales is part of the Kingdom of England.

As this article shows, the seemingly ‘easier’ choice between federalism and independence is not necessarily true. It is incumbent on Brown & Dugdale to publish the equivalent of a White Paper on their ‘federal’ policy. If they do not, it would be fair to draw the conclusion that, as with the 2014 intervention , their federal idea is a trap for the unwary.

Having floated the idea of a federal solution to the constitutional question, Brown and Dugdale now owe us the details. The Brown’s speeches in 2014 Vow came late, and fooled many, who believed they offered more than proved the case. Next time, we cannot be fooled again. Let’s hear the detail, lets have the debate.

PS: We offer either Gordon Brown or Kezia Dugdale space here to spell out what their new Act of Union will mean