Hugh McLachlan: A Union of convenience

Scotland benefits from the monies raised throughout the UK and EU
Scotland benefits from the monies raised throughout the UK and EU
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SCOTLAND cannot seek to stay within the UK ‘marriage’ but seek fiscal autonomy, argues Hugh McLachlan in considering what questions to ask in the independence poll.

Fiscal autonomy is a dubious goal. Furthermore, fiscal autonomy within the UK could not be presented fairly and honestly to the Scottish electorate as a feasible possible outcome of a legitimate, authoritative, decisive, solely Scottish referendum.

Not all money that is raised from taxation in, say, Morningside in Edinburgh will be spent in or on Morningside. Not all public funds that are spent in or on, say, Drumchapel, Glasgow, will be raised from people who live there. Such is the nature of civil society.

Furthermore, the decision of how much money should be raised in taxation from the residents of Morningside should not be made by the residents of Morningside. The decision of how much money should be spent in and on Drumchapel should not be made by the residents of Drumchapel, nor should the decisions about how such money should be spent.

Since the UK is part of the European Union, there is no reason to expect that all money that is raised in taxation in the UK will be spent here. There is no reason to expect that all public funds that are spent in and on the UK will be raised here. That is how political unions operate. Similarly, in the UK, public funds are devoted to, for instance, social security payments, pensions and the NHS. This involves taking money in taxation and transferring it to, or for the care of unemployed, elderly and sick people.

At different times, in different parts and in different countries within the UK, there will be relatively more or less people who pay a lot of tax and relatively more or less people who are unemployed, elderly or sick.

Not all money that is raised in taxation in and from Scotland need be spent in Scotland. Not all public funds that are spent in and on Scotland need be raised in and from Scotland. Some years, there might be an overall flow of funds in one direction and in other years a flow in the other. That is the nature of any political union such as the UK. So it would be too if, say, Scotland seceded from the UK but remained or became a member of the EU.

Other things being equal, those parts of the UK that prosper more will pay more in tax and receive less in public expenditure than less prosperous parts. However, it does not follow that the Union is a constraint on such prosperous parts. The richer and the poorer parts might both benefit from being united. Furthermore, people and places who and which sometimes prosper run the risk of floundering from time to time.

To advocate secession from the Union in order to move towards fiscal autonomy for Scotland so that, overall, the rest of the UK does not receive more in taxation from Scotland than Scotland gets back in return might be shortsighted. To many people, it might also seem to be mean-spirited.

A referendum is not a mere opinion poll. In an opinion poll, you can ask any questions you like and as many of them as you like. There are few if any constraints.

The various transfers and cross-subsidies that operate are such that it will often be very difficult to know what particular people, regions, parts, countries and so forth actually do experience a net inflow or outflow of public funds at any particular time.

For instance, the rate of smoking is higher in Scotland than in the UK. This will lead – other things being equal – to more per capita taxation but also more per capita spending on healthcare in Scotland.

However, other things will not be equal. For instance, if smokers do not live as long as non-smokers, this will have an effect on the cost of providing state pensions. The overall implications for public finance are likely to be very difficult to fathom.

A referendum is a particular means of making a decision on a particular issue. Hence, it matters very much what question is posed in a proper referendum. The questions in referendums must be such that they can be clearly, definitively and legitimately settled by the outcome of the referendum.

Not all important political decisions can or should be settled by a referendum. No one referendum can be expected to answer all the pertinent questions that could be raised with regard to any important political issue.

It also matters very much that those who are eligible to vote in a so-called referendum are clearly aware whether they are invited to take part in a proper referendum, in a sort of mere opinion poll or in a combination of both.

Imagine the confusion and discord that would ensue were people to be told after, say, a parliamentary election that the result was not binding but merely informative and consultative.

In the interests of clarity and simplicity, it is best in a proper referendum to have only one question. If more than one decision will be made and more than one question is thereby required, it should be declared that what will take place are referendums rather than a referendum.

Not all the questions that might be suitable to ask in an opinion poll are appropriate questions for a proper referendum.

To say that fiscal autonomy or any other particular option would be a popular one is irrelevant. Such popularity in itself confers no legitimacy upon it. The decision, for instance, to raise the level of old-age pensions or unemployment benefits in Morninside or Drumchapel might be a very popular one there. It does not follow that the level of old-age pensions or unemployment benefits should, unilaterally, be raised there by virtue of such popularity.

The question of what powers the residents of, say, Morningside or Drumchapel will have within Scotland could not be settled by the residents of Morningside or Drumchapel.

The question of what powers Scotland will have within the UK could not be settled by the Scottish electorate.

The electorate of, say, Yorkshire, Rutland, Scotland or England could not decide for itself that Yorkshire, Rutland, Scotland or England will be, within the UK, fiscally autonomous.

When people combine into households, even if they do not have children or enter into marriages “for better or for worse, for richer or for poorer”, they typically lose fiscal autonomy. On the one hand, they are not free to spend all their money on themselves. On the other hand, they might have access to and the benefit of funds that would otherwise be unavailable to them. Nonetheless, such relationships can be rational and satisfying. So, too, can be political unions of various sorts.

People can sometimes unilaterally choose to leave domestic relationships. It is sometimes wise to do so. Similarly, political unions can be dissolved. For instance, constituent parts of unions can choose to secede. However, people cannot reasonably unilaterally decide that they will stay in particular domestic relationships or marriages and become within them fiscally autonomous. Such a decision is not theirs for them alone to take.

Similarly, constituent parts of a union cannot reasonably unilaterally decide that they will stay within it, but become fiscally autonomous within it. That is not their decision to make.

• Hugh McLachlan is Professor of Applied Philosophy in the Glasgow School for Business and Society, Glasgow Caledonian University