Victory for devolution - but not in Scotland

Published on Sunday 18 June 2006 01:25

ALEX SALMOND was right after all. Almost a decade ago, the Scottish National Party leader predicted that the Union would not live to see its 300th birthday. Today, he will be vindicated when Catalonia votes to end its 295-year union with Spain and become technically recognised as a "nation" - albeit one which is not quite independent. We have a new potential entrant to the Eurovision song contest.

Mr Salmond has entertained the nation by giving a whole range of timetables for Scotland's secession from England. "Free by 93" and "Heaven by 97" were two of his old slogans. His deadline of May 1, 2007, the tercentenary of the Act of Union, was one of his less ambitious predictions, and it's easy to forget how plausible it all seemed on the cusp of Labour coming to power.

A decade ago it was the United Kingdom, not Spain, which was expected to be dismembered in the opening years of this century. Unionists and nationalists argued that a taste of home rule would whet Scottish and Welsh appetite for independence and English regions would want to follow suit. Instead, the United Kingdom has held firm, while Europe keeps devolving and former Soviet states are multiplying like Russian dolls.

Catalonia was from the offset seen as a kindred spirit with Scotland. It lost its independence in 1711, four years after the Act of Union. It was a Catalan architect whom we have to thank for the Scottish Parliament building, and several Holyrood officials have found excuses to fly off to Barcelona's devolved parliament to establish fraternal links. Yet it has two advantages Scotland lacks in the push for self-determination: power and money.

Spain's proportional representation system means that Catalan politicians can act as kingmakers, and put parties into power. This brings significant influence over national government. But greater influence still comes from its status as Spain's second economic powerhouse (the first is the already-devolved Basque Country) and today's referendum offers control over 50% of the taxes raised in Catalonia, up from 30% at present. Its 'Si' vote is a call for more of its money back.

If this call is made in Britain, it will come from the southern side of Hadrian's Wall. In 2003-04, the last year for which figures are available, 34bn was raised in tax in Scotland, which did not nearly cover the 45.3bn spent by the government. The gap was almost three times as large as the North Sea tax revenue. Since devolution, the picture has been getting steadily worse. Occasionally Mr Salmond produces some imaginative assumptions to the contrary, but the overwhelming evidence is against him.

While Catalonia has enjoyed growing economic strength relative to Spain, the reverse trend afflicts Britain. A decade ago, Scotland generated 8.7% of wealth in Britain, but today this figure is 7.9% and falling. In Wales, the rate of decline is faster - from 4.2% to 3.8%. London and its environs are pulling further and further away from the rest of Britain and the rest of the UK is in greater need of the cash concentrated in south. The vicious circle is completed when the tax is spent building up the state sector.

Scotland is destined to lag England economically because so much of its economy is now socialised. In Glasgow, over three in five voters either work for the government or are dependent on benefits. While this translates into Labour support, it bodes ill for economic development. In Cynon Valley in Wales, 71% of the electorate is in this category. Similarly depressing figures exist for Newcastle (62%) and Liverpool (56%). While the economic conditions for a secession are there in Catalonia, they are emphatically not met in Scotland.

The world over, the cash requirement is the driver behind independence movements. Serbia & Montenegro, beaten 6-0 by Argentina last week, will be separate by the time of the next World Cup and the countries who welcomed Montenegro's independence declaration also promised direct aid.

But the most flagrant attempt was made last week by South Ossetia, a pathetically small region of Georgia with a population smaller than Falkirk's, which has made its independence plans into a shameless fundraising exercise. At a donors' conference in Brussels it was offered €2m from the EU, €1m from Sweden, €1m from Belgium and €3m from Russia. At this rate, Falkirk itself could be tempted to launch an independence movement.

No cash, no drive for independence. Devolution has filled its primary function in that Scotland will never again have a Tory government - that much we have seen by its worse-than-dismal by-election results.

But for nationalists, cash is a lucky charm. A graph can be plotted tracking North Sea output to SNP support. Huge in the early 1970s, but trailing off in the 1990s. Now, with oil prices soaring up, so we have seen the party enjoy a string of council by-election victories in recent months.

Given that Scotland no longer has a Tory government it didn't vote for (which stoked SNP support through the 1980s), what other rationale is there for independence? To give the supremely talented Jack McConnell even more powers than he has now? The First Minister is a walking advert for Unionism, his scandalous mismanagement of the National Health Service a warning of what he might do if given control of social security or (heaven forbid) defence.

Catalonia, by contrast, has had good experiences with its politicians and does not consider them national embarrassments. The Basque Country has also prospered. Its ETA terrorists declared a permanent ceasefire and will enter official talks with the government. Spain is soon to become the most decentralised country in Europe: devolution there has worked. But in Scotland it has not been a "motorway to independence with no exits" as predicted by the great Tam Dalyell. It has turned into a dead end for Scottish nationalism.

But not for English nationalism. Not since the crusades has the flag of England been so proudly on display south of the Border. As late as 1990, the Union Flag was wrongly flown by England fans, but they have rediscovered a new popular sense of nationalism - a response, perhaps, to Scottish devolution. This will be not at all welcomed by Gordon Brown, a Scot who will soon ask for England's votes under a British banner.

Brown last week declared the 300th birthday of the Scotland-England union will be celebrated by minting a special 2 coin. This is fitting, as he has sent the equivalent of 30 billion of them up to his mother country in subsidy since becoming Chancellor and distorting much of the Scottish economy in the process. He has succeeded in burying the economic case for independence under a pile of cash - it's just that not enough of it was made in Scotland. It is hard to argue that any part of the UK is stronger as a result.