By Don Peebles, Head of CIPFA Devolved Government
The phrase ‘Brexit means Brexit’ is now firmly in the public domain. Realistically however we do not yet know the full ramifications or indeed the consequences for the economy and public services. The immediate reaction after the vote was the awareness that there was an identifiable regional variation in the vote not only between regions but between the countries of the UK. In Scotland for example more than 60% of those who voted, elected to remain as part of the EU. In fact every local authority area, voted to remain part of the EU.
The question of Scotland’s place in the EU has now prompted further constitutional challenges. In CIPFA’s paper treuble and strife
which, in advance of the vote, examined the different UK perspectives, it was identified that one of the consequences could be to trigger yet another referendum on Scotland’s position within the UK.
For Scotland it means that there is now a compounded uncertainty.
Firstly there are the uncertainties of the implications of the Brexit vote itself. CIPFA has sign posted that, irrespective of any constitutional issues which Scotland will face, the national issues already identified by CIPFA. These include the unwinding of the effect of EU regulation, border arrangements, workforce, the fiscal effects of immigration and any economic fall-out. This is of course faced by all of the UK.
Secondly, there is the uncertainty around what further constitutional change there could potentially be within the UK. The debate on Scotland’s relationship with the EU can be traced back to the Scottish Government white paper which was released in 2014 in advance of the referendum on Scottish independence. That paper set out the case for continued membership of the EU. Indeed, membership of the EU became a key point of debate (and contention) between the yes and no campaigns. The conclusion therefore for those voting in the 2014 referendum was that irrespective of whether there was a yes or no vote, that EU membership would continue or that EU membership would be sought.
Crucially, it was after the 2014 referendum vote that the firm proposal for referendum on the EU was announced. One school of thought immediately emerged which was that the UK which people had voted to remain part of in 2014, could potentially change as a result of the 2016 referendum. As CIPFA predicted the outcome of the Brexit vote did result in an immediate resumption of speculation on the constitution.
Thirdly, Scotland is changing anyway. New powers to raise a greater proportion of taxes and powers to borrow means that the dynamic effect of these new financial levers within what is a relatively small country could be disrupted. Whether this means for the benefit or to the disadvantage of Scotland in a post-Brexit world is not and may never be known.
So while Brexit may mean Brexit to some, north of the border the question which remains to be answered is what does Brexit mean for Scotland?