UK Constituent Parts (EU)

Ann McKechin Excerpts

Wednesday 21st November 2012 Westminster Hall

[Ann McKechin (Glasgow North) (Lab)]

Good morning, Mr Crausby. It is a great pleasure to have you chairing this important debate.

The 2014 referendum on Scotland’s future is a landmark in our constitutional history, although it is extraordinary that support for the proposition is steadily declining, even before the introduction of the enabling legislation at Holyrood. The fact that it is occurring at a time of increasing volatility, at home and globally, makes the arguments for and against even more contentious. I shall return to volatility later in my remarks, but let me make one observation at the outset: we most definitely will witness in the next two years a period of relentless tricky questions. I noted at the weekend that the university of Dundee is launching a project on “5 Million Questions”, which may take us up to the end of the current century although it is certainly a worthwhile programme. The vast majority of Scots are clearly unconvinced by the proposition of separation, and will be asking many complex, multifaceted questions about the effect that such a move would have on them, their families, their communities and their nation. Ironically, however, in the Scottish Government are masters of avoiding tricky questions. In the political arts, they could win numerous plaudits for their ability to body swerve many difficult areas of policy over a sustained period. That has served them well up to now, but those days are over and, as was evidenced at the Scottish National party annual conference this year, many of its own members are in for a difficult and unsettling experience.

My colleague, Catherine Stihler, one of Scotland’s Members of the European Parliament, asked a deceptively simple question in a freedom of information request last year, but it has been explosive in its effect and deeply revealing about the lack of transparency at the very heart of the Scottish Government. Regardless of how anyone views the European Union, everyone in the Chamber today agrees that whether Scotland would automatically be an EU member if it separated from the rest of the United Kingdom, and whether it would be required to renegotiate the major terms of its membership are both key questions on which the public require clear information.

About 70% of Scotland’s exports are to other EU nations. Let us not forget that if Scotland were not part of the EU, it would probably also face renegotiating entry into the World Trade Organisation, which is responsible for setting the criteria for just about all the remaining 30% of our export markets, including our valuable whisky market.

[Ian Murray (Edinburgh South) (Lab)]

My hon. Friend has already made a compelling case in the first few minutes of her contribution. Will she also reflect on the fact that recent Scottish Enterprise figures show that two thirds of Scotland’s “exports” actually go to the other component parts of the United Kingdom?

[Ann McKechin]

My hon. Friend makes a good point. If Scotland were not part of the EU in a post-separation scenario, obviously its trading relationship with the rest of the UK would be in question—what criteria, tariffs and so on would be in force? Scotland’s economy relies heavily on having a stable export market, and many thousands of jobs depend on foreign trade, but the manner in which the Scottish Government have twisted and turned at every corner to avoid a clear answer as to what legal advice they had on such questions can only corrode public trust. I shall give way in the hope that the questions may be elucidated.

[Mr Mike Weir (Angus) (SNP)]

I am listening carefully to what the hon. Lady is saying but, given the increasing Euroscepticism in the UK population and what is happening in this Parliament, how can she even be sure that the UK—with or without Scotland—will be a member of the EU in the next five to 10 years?

[Ann McKechin]

The hon. Gentleman may be surprised to know that on that issue I am united with them. The quality of our alliances and partnerships is what will allow Scotland to succeed, which is why I want to be part of a strong European Union, as much as I want to be part of a strong United Kingdom.

Let us return to the question of our status in Europe. Every time that the Scottish Government have been asked about the question of status, they have always sought to give the firm impression that continued EU membership was guaranteed and that no real material change in membership obligations would result from separation. One example of that sorry story is the interpretation of the Scottish Government ministerial code. That document was apparently altered—in a way that begs even more tricky questions—between the FOI request being made and the truth being forced out last month. Paragraph 2.35 of the code states, and I emphasise the first sentence:

“The fact that legal advice has or has not been given to the Scottish Government by the Law Officers and the content of any legal advice given by them or anyone else must not be revealed outwith the Scottish Government without the Law Officers’ prior consent. The only exception to this rule is that it is acknowledged publicly that the Law Officers have advised on the legislative competence of Government Bills introduced in the Parliament…Views given by the Law Officers in their Ministerial capacity are not subject to this restriction.”

I am grateful for the comments made by Ian Smart, the former president of the Law Society of Scotland, in a recent blog, which points out the revelation that legal advice given by “anyone else”—not the Scottish Law Officers—does not require the consent of the Law Officers; only the content of that advice must not be disclosed. Ian Smart said:

“And that is, on any view, deliberately the way the code reads for otherwise the first sentence would be the much simpler.”

The First Minister, however, in his interview on “Scotland Tonight” four weeks ago stated:

“That’s quite clear in the Ministerial code. It’s both the fact of whether it exists, and the content. I would need to clear it with the Lord Advocate if I wanted to say that I had not sought legal advice.”

That is simply not the case if we read the code accurately. Given the outcry about his remarks in the now famous TV interview with Andrew Neil back in March, we might have thought that the First Minister would have taken the opportunity to reread his own ministerial code before rushing into the TV studio. The tricky question that needs to be answered now is whether the First Minister sought legal advice from “anyone else” before that FOI request or his interview with Andrew Neil in March. If so, who was that from and what was said?

There may be some clues. On Tuesday, 30 October, the Lord Advocate wrote to Ruth Davidson, MSP. The third paragraph of that letter contains an interesting statement:

“As was made clear by the Deputy First Minister the Scottish Government has now requested specific legal advice from the Law Officers on EU membership. As you will be aware legal advice on many issues is provided by the lawyers in the Scottish Government Legal Department…but in relation to certain matters the Government will seek a legal opinion from the Law Officers. That is what is happening in relation to the matter of EU membership.”

That same afternoon, Nicola Sturgeon, the Deputy First Minister, summed up a debate on this very matter and, soon after 16.38 in the Official Report, said:

“Clearly, if ministers have sought legal advice, the law officers will provide that legal advice, so to reveal that legal advice has been sought from the law officers reveals the fact of such advice and puts us in breach of the ministerial code.”—[Scottish Parliament Official Report, 30 October 2012; c. 12755.]

Both of those statements cannot be true, however. Catherine Stihler’s inquiry remains whether the Government have been given any legal advice, and on that point there is still deafening silence.

The First Minister and his colleagues may argue that, when they make contentions on EU membership, they are speaking about evidence from a variety of experts—“in terms of the debate” is the phrase most commonly used—but that is not the same as legal advice. They know the difference. Some of the people quoted are not lawyers; some have died; and most of the statements seem to have been made prior to the Lisbon treaty, which made fundamental changes to the European Union’s constitution. None of those represent a legal opinion, and just as many eminent people disagree with those expert opinions, including no less a person than the current EU President.

Here is one simple question the Scottish Government should clarify urgently. Have they already had legal advice from their legal directorate? It is difficult to imagine that, when the Scottish Government issued their White Paper, “Your Scotland, Your Voice: A National Conversation” in 2009, they did not run it past their own legal department. That document contains examples of ambiguous phrasing in its comments about EU membership. I draw hon. Members attention to page 110, paragraph 8.12:

“Settling the details of European Union membership would take place in parallel to independence negotiations with the United Kingdom Government”.

That phrase sounds as though it were written by a lawyer, and as I am a lawyer and a member of the Law Society of Scotland, I speak with some experience. Will the Minister confirm whether his Department has received any information about whether the legal department was consulted on that document, and whether it asked his office for advice or information about EU membership if Scotland were to separate?

That brings me back to volatility. As other hon. Members have said this morning, the EU is undoubtedly experiencing the most challenging and volatile period in its history. Its fiscal policies are under constant stress, there is significant unrest in many regions caused by massive hikes in unemployment and cuts to public services, and there are major differences of opinion in the political leadership. That is where legal opinion hits realpolitik.

Yes Scotland’s latest leaflet states without reservation:

“We can all see the one thing holding us back—we let someone else take decisions for us.”

lf the Scottish Government want our country to remain part of the EU come what may—that seems to be what the hon. Member for Angus (Mr Weir) said—the painful truth is that other people will make decisions for us on how long the application process will take, the conditions for membership, the size of our contribution, our entry into the eurozone, and our entitlements under the common agricultural policy and the common fisheries agreement. As one small nation in 28, our negotiating position, at best, will be fairly weak.

[Mr Weir]

That is all very interesting, but has the hon. Lady bothered to listen to the news from Europe, where the Prime Minister is going to discuss the European budget? It seems that the rest of the EU is ganging up to cut the UK out of the EU, and to cut the famous rebate that everyone goes on about.

[Ann McKechin]

I thank the hon. Gentleman for proving my case about volatility and disputes in the European Union. Any union or partnership that lasts a long time has difficult phases, and this is one. He has proved my point that the negotiations will not involve simply providing a list—that is what the First Minister always seems to suggest—saying what Scotland would like and expecting people to nod and say, “That’s fine. Don’t worry. That’s okay with us.” That will not happen, and any attempt to try to prove the opposite shows the weakness of the argument.

On the national central bank and financial regulators, Croatia’s recent entry negotiations show that they are not tick-box exercises, and again there is no guarantee that other EU members would be attracted to the solution that the Scottish Government prefer at the moment of relying on another EU member to provide both important institutions, and that is if that EU member agreed to that in the first place.

[Mr William Bain (Glasgow North East) (Lab)]

My hon. Friend is making a powerful argument. I remind her that the most recent entry to the EU, Croatia, had to satisfy stringent tests about guaranteeing bank deposits, the independence of its central bank, monetary policy and financial security. Does she see anything in any of the plans produced by the Yes Scotland campaign that deals with any of those points?

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[Ann McKechin]

My hon. Friend raises a good point. It is understandable, given the financial and economic crisis that the EU has suffered over the past five years, that it would take a precautionary approach on any banking issue and financial regulation particularly. The Scottish Government’s proposals are untested. They have never been used by another EU member in the way proposed, and we have no idea how they would work, because we have received no details in response to the many questions that the Scottish Government have been asked. Apparently, we must wait until autumn 2013 for the revelation, apparently in tomes. The questions should be asked now if we want a proper analysis and expert opinion not only in our own country, but throughout the EU. We need that information now.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

As far as I know, Croatia does not have a particularly large international banking presence—I hope that I am not being unjust—but Scotland is still the headquarters not just of some UK banks, but of international banks. Does that not emphasise that in any new treaty, if Scotland were to become independent, the EU would be keen to ensure that proper regulatory arrangements were in place for the Scottish banking sector?

[Ann McKechin]

My hon. Friend has spent much of his time campaigning on financial services, because they are relevant in his constituency. He hits the nail on the head, because we have a significant financial services sector in Scotland. It is the second largest outside the City of London, and has many jobs, not just in banking, but in other financial services, such as equity markets and insurance funds. Many of the people who use those funds and many investors live not in Scotland, but in other parts of the United Kingdom.

There are many questions to be asked about the currency that will be used, and the regulations. We can take it as certain that the EU will take a precautionary approach, and will ask for those issues to be tested and examined in great detail. As yet, the Scottish Government have not produced a comprehensive document setting out the proposals. At the moment, they seem to think that the rest of the UK will continue to act as the financial regulator, but there is no guarantee that it would be tempted to do so. Why would it take on the risks and responsibility for institutions outwith its borders and over which this Parliament would have no direct control or responsibility? The UK Parliament’s risk would increase.

Given the gridlock of other membership requests, and that other EU states are much less relaxed about national referendums for secession, there is every risk that the application and negotiations could drag on with consequent risks and uncertainty to our economy and particularly our financial services. I would be interested to hear today the Foreign Office’s perspective on such a scenario. Will the Minister confirm what the legal standing of a separate Scotland would be with the World Trade Organisation if at the point of secession it was not a member of the EU? Have the Scottish Government ever asked his Department for information about that? Has there been any formal dialogue with the EU Commission on the proposal for another EU member’s central bank to be Scotland’s bank of last resort?

We have discovered in the last few weeks that the truth can be difficult to admit, but surely anyone who believes that a country’s citizens should be able to make the right choices also believes that they should be provided with full answers to those tricky questions, because they will not go away.

[Mr David Crausby (in the Chair)]

I will call the Front Bench Members at about 10.40 am. Although I am not going to impose a time limit, it would be helpful if Members kept their contributions to not much more than five minutes.

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[Pete Wishart]

I am not giving way to the hon. Lady.

These people sometimes use the example of Russia when it comes to these situations, but not even the most rabid cybernat has ever compared the United Kingdom to the Union of Soviet Socialist Republics. That is how ridiculous their argument has become. When it comes to European membership, whatever happens to an independent Scotland will happen to the rest of the United Kingdom, but let me reassure all the English Members who are sitting here today: their European place is safe. There is simply no precedent or process to kick a constituent part of the European Union out. That just does not happen—there is no way. This fox was effectively shot by Graham Avery of Oxford university, who is a senior adviser at the European Policy Centre in Brussels and honorary director general of the European Commission, when he said to Westminster’s Select Committee on Foreign Affairs:

“For practical and political reasons the idea of Scotland leaving the EU, and subsequently applying to join it, is not feasible.”

It is not feasible.

[Ann McKechin]

Will the hon. Gentleman give way?

[Pete Wishart]

I am not giving way to the hon. Lady.

There is only one part of Europe that has left the European Union—the hon. Member for Stone (Mr Cash) will recall this—Greenland. It took something like two years for Greenland to get out of the European Union, and it wanted to go. It had a vote that said that it wanted to leave the European Union. It was only after complex negotiations that it was allowed to go.

These people believe that somehow Scotland will be stripped of its European Union membership and all the European rights that we have built up in the course of 40 years. Scotland is actually enthusiastic about Europe, unlike the hon. Member for Stone and his hon. Friends. It is absolutely absurd to suggest that an independent Scotland would not be welcomed with open arms to the European Union. We are talking about oil-rich Scotland, fisheries-rich Scotland, renewable-energy-rich Scotland. Scotland complies with every single piece of European legislation and is enthusiastic about its European membership. The idea that Scotland would be kicked out of the European Union is totally absurd.

These people also say that we will be forced into euro membership. That was blown out of the water by Dr Fabian Zuleeg, chief economist at the European Policy Centre, who reminded the Scottish Parliament’s European and External Relations Committee that euro membership is based on strict criteria. My hon. Friend the Member for Angus (Mr Weir) is absolutely right about this. There are five conditions for joining the euro. One is membership of the exchange rate mechanism. Joining the ERM is voluntary. That is why Sweden is not in the euro. I do not know how many times we have to explain this to Labour Members. Scotland will not join the euro, because Sweden has not joined the euro, because it is based on ERM membership.

There is a threat to Scotland’s European membership. It does not come from an independent Scotland. It comes from the Union; it comes from the Westminster Tories, because they are at it again. They are even prepared to defeat their Government to ensure that they get this country out of the European Union. I looked at William Hill yesterday. It is offering odds of 2:1 that by 2020 there will be a referendum on the UK’s membership of the EU—a straight in-out referendum. It is offering odds of 6:1, which I think are very generous, that the UK will be out of the EU by 2020. That is the threat to Scotland’s EU membership. It does not come from an independent Scotland; it comes from the Westminster Tories. Westminster Tories are running absolutely terrified of the UK Independence party, which is now odds-on favourite to win the next European election. That is what is informing Government policy when it comes to Europe. What we have now is a surly, sulky UK as a member of the European Union. That is what Scotland has to put up with as it secures its EU membership. The UK is looking for the “Out” door—

[Ann McKechin]

Will the hon. Gentleman give way?

[Pete Wishart]

I am not giving way to the hon. Lady; I have told her that.

That is what we have in terms of Scotland’s EU membership represented by the UK. What would be better? An independent Scotland, independent in Europe and seated at the top table. Our number of MEPs would be increased from six to 13; there would be 13 champions putting Scotland’s case. That is what Scotland needs; that is what Scotland requires.

There is a clear choice facing the Scottish people when it comes to European Union membership: independence in Europe, a seat at the top table, our own representation in Europe, or isolation in a United Kingdom that is on the way out of the European Union and almost relaxed about its decline and failure. I know the choice that the Scottish people will make in 2014. It will be the positive choice—it will be for Scotland’s independence and national liberation.

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[Emma Reynolds (Wolverhampton North East) (Lab)]

It is a great pleasure to serve under your chairmanship, Mr Crausby, and I congratulate my hon. Friend the Member for Glasgow North (Ann McKechin) on securing this debate.

It is the passionate belief of the Labour party that the United Kingdom is stronger together and that the United Kingdom is stronger in the world as a member of the European Union. The referendum on Scottish independence in 2014 is an incredibly serious matter that will affect all of us in the United Kingdom and, as has been stressed by several of my hon. Friends, when the Scottish people vote in that referendum they deserve to have at their disposal the full facts about the implications of a separate Scotland.

Unfortunately, far from providing clarity about the facts, the Scottish Government have created a great deal of confusion about the potential consequences of Scottish separation for Scotland’s relationship with the European Union. It is pretty extraordinary—indeed, it beggars belief—that, as has already been mentioned by my hon. Friend the Member for Glasgow North, in response to a freedom of information request from one of our colleagues in the European Parliament, the Labour MEP Catherine Stihler, the Scottish First Minister initially said that he would not disclose legal advice, only for him to be contradicted by the deputy First Minister of Scotland who said that such legal advice had not even been sought, let alone received.

[Ann McKechin]

Just in the last hour, it has been announced in the Court of Session papers regarding that FOI request that the Scottish Government stated that to reveal whether or not they had received legal advice would cause mischief. That is an extraordinary statement, given the Scottish National Party’s supposed links with the people of Scotland and given their ability to know what the facts of that case are. Does my hon. Friend agree that that lack of transparency, which included taunting people for the number of FOI requests that they had put in to the Scottish Government, is indicative of a Government who are actually scared of telling the truth?

[Emma Reynolds]

That lack of transparency is of concern to all of us, and it has blown a hole in the credibility of what the First Minister has said on this issue.

The hon. Member for Perth and North Perthshire (Pete Wishart) has made a speech today, which I have had the fortune—or misfortune—to have read before the debate, in which he made some strange references to giant pandas and “The X Factor”, but remarkably he made no reference to the European treaties and perhaps more tellingly he also did not refer to any other European Union member state. If he had cared to take a look at them, he would have seen that those treaties make it very clear that new member states must apply for membership of the European Union. Article 52 of the treaty on European Union lists the members of the European Union, including the UK, and article 49 of that treaty states that new member states must apply for membership of the European Union. Moreover, as my hon. Friend the Member for Ochil and South Perthshire (Gordon Banks) has made clear, the European Commission President has also stated the clear facts. He has said recently:

“A new state, if it wants to join the EU, has to apply to become a member of the EU, like any state.”