Analysing this issue from a dispassionate and politically neutral perspective, our aim is to highlight the potential areas of interest that could arise for businesses in Scotland if there is a second referendum. This includes our analysis of the key legal hurdles that would need to be addressed before legislation on a second vote could progress.
The power sharing deal brokered between the SNP and Scottish Greens at the end of August gives the Scottish Government a pro-independence majority and could now elevate the prospect of a second independence referendum.
Before securing the agreement with the Greens, whose co-leaders Patrick Harvie and Lorna Slater have been given ministerial positions, First Minister Nicola Sturgeon stated that the first priority of her then minority Scottish Government was COVID recovery with no plans to hold an independence referendum in the early stages of this parliament. While that position remains unchanged, the potential for her seeking a second referendum over the course of next year or by 2023 now seems more realistic.
The constitution and the ‘Union of Scotland and England’ remain reserved matters for Westminster and the UK Government has currently ruled out allowing another vote on this matter for the foreseeable future.
The First Minister has ruled out trying to circumvent this situation by holding an unlawful referendum on independence, as the Catalan Government did in 2017. Whereas the 2014 referendum was sanctioned by the UK Government through a Section 30 Order, a “wildcat” referendum would not get recognition from the international community if it led to independence and would result in a Spanish veto if Scotland attempted to re-join the EU.
While the Scottish Parliament has passed two bills that deal with the process (and franchise) of referenda in Scotland generally, and the Scottish Government published a draft Scottish Independence Referendum Bill that proposes the same franchise as the 2014 vote, there has been no further push for a Section 30 Order to date.
It does however seem to be only a matter of time until the Scottish Government puts forward a formal Section 30 Order request. If, as seems likely, the UK Government says no, pro-independence parties in Scotland may use that rejection as a means of building further support for their agenda or for legislating for IndyRef2 within the Scottish Parliament. The constitutionality of such a referendum could then be decided by the UK Supreme Court which has jurisdiction to determine whether bills of the Scottish Parliament are within its powers.
If a referendum bill were to be passed by the Scottish Parliament without a Section 30 Order, the terms of the Scotland Act 1998 would allow the UK Government four weeks to bring forward a challenge in the Supreme Court.
If the UK Supreme Court ruled that the referendum bill was competent, Westminster could pass legislation to retrospectively overrule such as bill. However, most analysts believe the Supreme Court would likely rule that a referendum bill is beyond the Scottish Parliament’s competence, which would block the legal route to IndyRef2.
While the UK Government suggests it’s unlikely to grant a Section 30 Order any time soon, it must also take care with its handling of the situation so as not to bolster support for independence.
There are options it could consider such as granting the Section 30 Order but with specific conditions including extending the franchise to Scots living elsewhere in the UK; setting a ‘supermajority’ threshold (eg 60 per cent of those who vote for independence); or allowing for a second confirmatory vote once an independence deal was agreed between Scotland and the UK Government.
The above and other options proposed by pro-Union supporters could however carry a significant risk that a vote in favour of remaining in the UK is de-legitimised in the eyes of some pro-independence supporters.
Although the Scottish Government commands a pro-independence working majority in Holyrood with Green support, there remains little certainty about how, when and even if IndyRef2 will progress. The focus for lawyers is to monitor legal developments and advise on their potential implications as this debate will undoubtedly roll on.
Stephen Philips is a Partner and member of the Independence Advisory Group, CMS