September 16, 2014 by Paul Goldsmith
14 years ago I was sitting in a sales meeting at my old IT consultancy. We were attempting to persuade a major company to use us to install their HR system (stay with me!) and it wasn’t working. We were down to the last two and the ridiculous promises made by the other bidder, that we knew they couldn’t deliver on, were swaying your potential client in their direction. The leader of our Sales team went to see our CEO, who got in his Lamborghini, drove up to London, came back later and told us it was done, we had got the project. We had a big celebration that night, and next morning I sat down with the budget the CEO had agreed and tried to work out how we would deliver the solution in that timescale and with that money. I realised, quite quickly, that he had effectively sold us down the river. I wished he had consulted us before agreeing to what he agreed to. In the end, we had to work 12 hours a day, sometimes 7 days a week, and hand over to a team in India for the next 12 hours, and back and forth for 3 months as the only solution.
I tell this story because it was brought to mind when I saw Gordon Brown and the three party leaders up in Scotland last week ripping up the British constitution in an attempt to bribe Scottish voters into voting No. They talk of ‘Devo Max’, or ‘Home rule’ of passing powers to the Scottish Government. Yet where do they get the right to do that without consulting the rest of the UK? People say that a Yes vote will bring chaos. Well, a No vote could bring just as much.
Let’s give an example about tax raising powers. Thanks to a second question that came with the 1997 devolution referendum, the Scottish parliament has the power to vary tax rates by 3% either way. This power, which they have never used, will be extended under Devo max to having full tax raising powers. That means that MSPs can vote on raising the higher rate of income tax to 50%, or lowering the rate of corporation tax to 12%. That sounds fine until you realise that Westminster MPs with Scottish constituencies will not have any influence on Scottish taxes AND will then have votes on taxes in England, Wales and Northern Ireland which do not affect their constituents.
The reason this could cause chaos is that, given the left wing bias of MPs who get elected in Scotland, they could hold the balance of power on what the higher rate of tax should be in the rest of the UK, particularly under a Labour government, whilst their votes affect constituencies that are nothing to do with them. This is called the ‘West Lothian question’, in which Scottish MPs can’t vote on many issues affecting Scotland but can vote on issues affecting the rest of the UK. We could have a situation in which Prime Minister Ed Miliband can only get a policy through if voted on by Scottish MPs, who are voting on issues that don’t affect their constituents.
Tory MPs have already made it clear that if Devo Max is granted they will expect only English MPs to vote on issues that effect England, rest of Uk MPs to vote on issues that effect the rest of UK etc. This, they feel, is only fair, if Scotland has been granted that much freedom, why can’t we call have it?
Nigel Farage will probably lead this campaign. He constantly points out that we are losing our sovereignty to the EU and having rules and policies made for us by people unaccountable to us. If we in the rest of the UK also lose our sovereignty to Scotland as well, there is a good case for that being unconstitutional.
In the event of a Yes vote, we should only really enter into a currency union with Scotland after a referendum, as it would affect they way we are governed and exposes us to considerable risks. But why are we prepared to cede so much sovereignty to Scotland in the event of a NO vote without consulting the people too?
Sadly, given our leaders have made so many promises so publicly, we will have little choice. But it would at least be nice if it were explained to the rest of the UK why Devo Max should be acceptable. At the moment it looks like a concession to a stroppy teenager who is threatening to run away without listening to reason, and the Yes campaign have rightly pointed out that it should have been offered a long time ago. The reason it looks like that, is because that is exactly what it is. A bit like a parent who comes home to find their spouse has given in and bought the XBoX they had always agreed they wouldn’t do. A bit like the CEO who gets the client by promising a deal that imprisons their workers at their desks for the next six months. It’s the British people who will be affected by this, and we should be questioning it more.
p.s. By the way, on this subject, the Scottish Government have had complete control of the Scottish childcare budget since devolution. So why are the SNP promising that a Yes vote will result in free childcare? Why haven’t they offered that already?