George Kerevan: SNP policy makers can expect no rest from wicked

Published on Wednesday 29 June 2011 15:57

If Alex Salmond wants an independent Scotland he cannot stay silent forever on policy for its currency, tax, banking and defence

IT is a truth, universally acknowledged, that if a political party does not have a watertight policy on something, then its opponents will make one up for it. So avoid it as he might, Alex Salmond is going to have to explain the SNP's post-independence plans for Nato, banking regulation, currency, EU membership negotiations and pensions, if he wants a Yes vote in the coming referendum.

It is not only Scottish voters, or the hacks who want answers. There is the little matter of the SNP's rank and file. They have been remarkably disciplined over the last decade. But it would be very strange if, after all their efforts, they did not expect to be consulted over the questions on the referendum ballot paper, or the end goal itself - independence or UK confederation?

The fact is SNP members have asked for policy updates. In 2001, the SNP's National Conference passed a motion calling for a comprehensive review of taxation. Nothing happened. In 2005, the conference called for an "independent commission" to draw up a "modern, competitive taxation for Scotland". We still don't know the SNP's tax policy after independence, though Alex Salmond is on record as favouring a cut in corporation tax.

The 2010 Campaign Conference wanted a Scottish Defence Review. We are still waiting. The spring 2010 National Council asked the leadership to produce a policy on bank regulation. But the First Minister remains studiously silent on what regulatory regime an independent Scotland might impose.

With the advent of a devolved parliament, SNP policy making has migrated from the party's internal structures to MSPs, and then after 2007, to ministers and their youthful special policy advisers - the SpAds. Perhaps this was inevitable given the need to actually run a country, while coping with a 24/7 news agenda.

However, the SNP is not any political party: it aims to create a new state. Which means the depth of its policy analysis has to be sufficient not only to wrong-foot a unionist media anxious to exploit potential weaknesses, but also to operate the day after the Saltire is run up over Edinburgh Castle. Call these the "wicked" questions we are not allowed to ask, but which the SNP needs to answer.

The first "wicked" question concerns what currency Scotland will use on independence. Current SNP policy is to keep sterling pro tem but favours membership of the eurozone when the "conditions are right", subject to a referendum. But times have changed. Post the deficit crisis in Greece, Ireland and Portugal, the euro option is hardly on the cards. Even if the eurozone survives, it will only be by imposing much stricter fiscal rules from Brussels.Yet, if we keep the pound, our interest rates and exchange rate will be decided down south. We would have our own fiscal policy, so eliminating the permanent deflation of the last generation caused by Scotland's tax surplus flowing to the Treasury. But one might cancel out the other.

A third way - an independent currency on the Norwegian model - is certainly feasible. Most of the small EU economies with their own currency have done remarkably well since the credit crunch. Canada has made artful use of its own currency, despite being a branch office of the US. But try telling that to Scottish businesses during a downturn. The truth is, there is no easy solution. The UK itself has spent the last 20 years debating currency options. Scotland should air them too.

Another "wicked" question concerns defence. SNP policy favours withdrawing from Nato as long as the alliance maintains nuclear weapons. Instead, the SNP proposes joining the Organisation for Security and Cooperation in Europe (OSCE), a 56-member body set up to build bridges between Nato and the former Soviet Bloc countries. But the OSCE is a talking shop rather than a true collective security pact. Its mention in SNP resolutions has more to do with providing political cover than defence strategy. OSCE proved stunningly irrelevant when Russia invaded Georgia - both are members.

In recent years, prominent SNP members have questioned the party's negative stance on Nato. In 2004, when running for the SNP leadership, the current Education Secretary Michael Russell said: "(Quitting Nato] is a policy which was born out of the Cold War and has never been substantially revisited. We are in a different world and one in which most of the new nations of Europe have been clamouring to be part of Nato.

"As long as we can be a non-nuclear member, as Canada and Norway and indeed most other countries are, this will not only give our defence policy relevance but ensure we can explain our stance, which is hard to do at present. The party needs to discuss it and come to a conclusion."

Unfortunately, the party has not discussed it. Certainly, under defence spokesman Angus Robertson, SNP policy has become much more pragmatic and focused, including sharing military bases and procurement with the rest of the UK. However, a defence pact with the UK - which is both necessary and sensible - implies common foreign policy objectives with the nuclear state to our south. Why is that possible, but Nato membership not? And what will the UK demand in return?

The SNP leadership has a justified worry that engaging in a policy debate will turn the party inwards, give a platform to nutters, and play into the hands of a hostile media. Why is that any improvement on being run from the City of London?

But the leadership cannot escape such a discussion because ordinary voters want answers before they'll vote Yes in the referendum, and because the SNP's rank and file won't be complacent forever.

The solution is simple. The SNP leadership has to be pro-active and set up one, or a number of, expert commissions, to review policy and think "wicked" thoughts on the key questions. They are not obliged to accept the results. But at least we could have a public airing on sensitive issues.