Scotland’s place in Europe: Differentiation is the key issue, says Scottish Government
Scotland needs to protect its access to the Single Market
The Scottish Government is making the case for Scotland retaining access to the Single market.
Scotland’s Place in Europe, the paper produced by the Scottish Government last December clearly states Scotland’s interests would be best, though not comprehensively, secured by the continuation of the rights and freedoms Scottish and UK citizens currently enjoy as members of the European Single Market, along with the broader economic and social benefits which adhering to the free movement for persons, goods and capital it provides.
Short of full EU membership, the least worst outcome for the UK as a whole would be to retain full membership of the European Single Market through the European Economic Area, and to remain in the Customs Union.
Remaining in the EEA would mean being part of an existing structure for engagement, which would provide greater certainty for businesses and citizens. Given the many years, perhaps decades, of uncertainty involved in the pursuit of bespoke deals with the EU and other world trade partners, Scotland’s interests would be best served if the UK retained its membership of the EEA.
Differentiation is the name of the game
The paper’s proposals on differentiation offer a feasible way to reconcile what now appears to be the UK’s current position to exit the EU and the Single Market with the democratic wishes of a majority of the Scottish electorate and their elected politicians, and will best mitigate the risks that Brexit poses to the Scottish economic and social interests.
An acceptance of the need for, and the case for, differentiation would be the first step towards detailed, constructive discussion of these options and others.
The proposal would require very detailed discussion and negotiation. But this is worth the effort as this option is capable of meeting Scotland’s requirements for continued trade within the European Single Market, adherence to the “four freedoms” and implementation of the range of “flanking” policies which support and complement the operation of the European Single Market, while providing a feasible structure for continued free trade and movement across the UK.
Building on existing relationship
The proposal also has the merit of complementing and building on the existing relationships.
For instance, the Faroe Islands, not an independent state, is currently exploring the possibility of joining EFTA – a possibility that is under consideration5. It is envisaged that Denmark would “sponsor” the Faroe Islands membership of EFTA. This shows that a sub-state may enter into international agreements. In similar circumstances, and with its own legal system and strong tadministrative capabilities, Scotland would be well placed to meet those requirements.
If the UK Government could seek to maintain its current EEA membership, through an application for EFTA membership, it could then seek a territorial exemption so that this membership would only apply to Scotland (unless other devolved administrations also requested it).
There is precedent for territorial exemptions in the EFTA Agreement. For example, Svalbard, which forms part of Norway’s EFTA membership, has elements of the EFTA agreement dis-applied to recognise its unique geographic and trading position. (It could be certainly argued that Scotland’s islands confers it a unique geographical position, and this should certainly emphasised , suggests the Scottish Islands Federation). Unlike the “reverse Greenland” proposition, this option would be consistent with the referendum outcome, since it would only require formal UK membership of the EEA, and not of the EU.
Scotland must be allowed to put forward the differentiation option
It appears increasingly unlikely that the UK Government will choose to retain membership of the European Single Market through the EEA, a decision which could cost the Scottish economy up to around £11 billion per year.
The Scotland in Europe paper states the Scottish government’s intention to use the mechanism of the Joint Ministerial Committee structure to:
- a) “Explore – openly, constructively and in good faith – options for a differentiated solution for Scotland that enables us to remain in the EEA while the rest of the UK leaves.
- b) Include any necessary commitment in the Article 50 letter to pursue a differentiated solution for Scotland that enables Scotland to remain within the European Single Market as the rest of the UK leaves.
- c) Discuss, negotiate in the appropriate forums, and conclude the practical solutions and shared administrative arrangements we would need to put in place to make a differentiated solution work effectively.
Potentially more devolved powers to Scotland
Policy for devolved functions currently subject to EU law must be the responsibility of Scottish Parliament, states the Scotland in Europe paper.
Some of the major devolved areas that will be affected include:
a) Agriculture, food and drink, in areas covered by the EU Common Agricultural Policy and EU law on food and drink, animal health and welfare, plant health, seeds, potatoes, pesticides and genetically modified organisms.
- b) Fisheries, aquaculture and the marine environment, which are subject to the EU Common Fisheries Policy and marine environment and planning laws.
c) Environmental protection, including laws on pollution, waste and recycling.
d) Civil law, in areas such as family law where the institutional and administrative arrangements which currently shape Scottish and European co-operation risk being undermined by the UK leaving the EU.
- e) Criminal law and law enforcement, particularly in relation to information sharing and co-operation, the European Arrest Warrant, prisoner-transfer agreements and counter-terrorism measures.
- f) Health, where for example protections afforded under the European Health Insurance Card scheme are at risk.
- g) Higher education and research, where Scotland has benefited from EU mechanisms for collaboration and funding.
A significant increase in devolution is required to protect Scotland’s key interests, including delivering any differentiated arrangement with the EU. A consequence of leaving the EU cannot and must not be that power is further concentrated in the UK Government and at Westminster.
Download Scotland’s Place in Europe by clicking here.
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