Scotland and North-east England Post-2014

Guy Opperman Excerpts

Tuesday 4th March 2014 Westminster Hall

[Phil Wilson]

The hon. Gentleman is not necessarily comparing like with like. Scotland and England, and the rest of the UK, have a shared history that goes back 300 years.

I read something recently on the blog “Open Democracy” by Gerry Hassan and James Mitchell, two pro-separatist academics based at the university of West Scotland and Edinburgh university. They state that the metropolitan establishment have pronounced on the currency union, and go on to say:

“London is where the problem lies. But our friends in the north of England have long understood this.”

Speaking as an MP for the north-east who has lived in the north-east all his life, I say to those commentators and the SNP that they should not patronise the north-east of England by pretending that they speak for my region—they do not—or offer friendship with one hand while building a wall between us with the other.

I agree that there should be deeper economic cross-border relations between Scotland and the north-east of England; I have no problem with that. The IPPR North study “Borderlands”, commissioned by the Association of North East Councils, points out that there should be closer cross-border relations, especially between local authorities on either side of the border. Who could argue against that, especially when it comes to issues such as transport? I understand that the SNP agrees, which I am pleased to hear, but surely that would be much easier to do across the existing border than across an international border between two independent states.

[Guy Opperman (Hexham) (Con)]

I congratulate the hon. Gentleman on securing this important debate. I accept entirely the point that he is making: cross-border economic relations of every kind will be affected and harmed if Scotland becomes independent, whether by different tax rates, border controls or fundamental changes to the transport systems, two of which would not meet.

[Phil Wilson]

The hon. Gentleman has raised the point that I was going to make next with some statistics. At present, more than 23 million vehicles, 15 million tonnes of freight and 7 million rail passengers a year cross the border between England and Scotland in both directions. If Scotland becomes an independent state, the current border will become an international border. Scotland will have to take control of its border and introduce the relevant regulations to manage it. The present UK is a true domestic single market: businesses in Scotland have easy access to customers throughout all parts of the UK, as does the north-east of England. Anyone who has the people and their benefit in mind will surely see that as a key reason why Scotland should not be independent, and why we should work together for the benefit of all the people who live in the UK.

An international border would create a barrier to all that. For example, as I have said, 40,000 people travel each way across the border every day to work. An independent Scotland would not have the membership of the EU or the common travel area that it now enjoys. It would have to renegotiate travel arrangements with the rest of Britain.

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[Phil Wilson]

My right hon. Friend says that Scotland would be obliged to join. The position of the Scottish National party is that once it believed Scotland should join the euro. Then it wanted Scotland to have its own currency, and now it wants to stay with the pound. Can SNP members make up their mind? It is not possible. They want to have their cake and eat it.

Thousands of north-easterners would have to take their passports to go to work in Scotland, and Scots would have to take their passports to travel from Scotland to England. I have relatives in Scotland who visit my family in south Durham every week. My brother is English and his partner is Scottish. They make that journey every week without let or hindrance, and now the SNP wants to put border controls there. Scotland will not be a member of the EU or of the common travel area, and cannot have it both ways.

[Guy Opperman]

It is fair that we keep making the point by giving particular examples. The hon. Gentleman will be aware that the North East chamber of commerce has expressed specific concerns about the currency issue, and the Northern Farmers and Landowners Group, which represents the cross-border farming community, including many farmers who farm both sides of the border, has also expressed significant concern that if independence went ahead the ability of the farming community to function would be gravely impeded.

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[Guy Opperman (Hexham) (Con)]

I congratulate the hon. Member for Sedgefield (Phil Wilson) on securing this debate.

I speak as a mongrel Brit of immigrant ancestors, as the representative of a constituency that borders Scotland, and as someone who has repeatedly made the case that we are better together. I went to Scotland last year and did a series of events over about 10 days, debating this issue from Aberdeen all the way down to Argyll. I was struck by the fervour created by this point. The issue matters desperately to those of us who represent north-east constituencies, because it will have a significant impact on trade. Of course, trade and tourism will continue and, of course, Scotland will continue to exist as an independent country, but there is no doubt that the decision will have an impact on business and on job prospects in the border region.

When one analyses the case put forward by the Scottish National party, it is, on any interpretation, economically illiterate. When the hon. Member for Sedgefield made the point that the Scots wish to have their cake and eat it, the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) wisely and intelligently said from a sedentary position, “That’s what cake’s for.” It is a policy totally devoid of any grasp of reality.

Looking at the currency issue, the SNP argues that it wishes to have the pound, but it does not want Mark Carney or the Bank of England having any controls, because when one takes independence, one forfeits huge amounts of control over the ability to tax, set interest rates, and the like. We are now in a position of sterlingisation, a policy best espoused by those legendary countries, Panama, Montenegro and Greece.

[Mr MacNeil]

Will the hon. Gentleman give way?

[Guy Opperman]

Of course I will. I cannot wait.

[Mr MacNeil]

The hon. Gentleman will, of course, furnish us with information about which countries have shared sterling in the past, and particularly about how many countries were sharing sterling in the 1970s.

[Guy Opperman]

The hon. Gentleman will be well aware that no sensible economist would say that a policy of sterlingisation would support a country’s banking and fiscal system. The desire that we all have for greater North sea oil prosperity is based on a fundamental need to secure the markets, and to secure bank finance, for example. That would be grossly affected by a floating sterling position in Scotland.

As for borders, my constituents in Northumberland are deeply concerned about that matter. It is worth analysing briefly the position in relation to immigration controls. For my sins, I have read the Scottish Government’s paper, “Scotland’s Future”, and I assure hon. and right hon. Members that it is a long, hard read. Chapters 6 and 7 set out the Scottish Government’s preference for an independent Scotland joining the EU, but staying within the common travel area. Others commented, rightly, on the fact that originally Scotland wished to join the euro; then it decided that it wanted the pound, and now it is sterlingisation.

However, in respect of immigration policy—not that we are in Woolworths, having pick ’n’ mix in any way—the Scottish Government prefer to have an EU policy and support that part of the EU. That is, of course, contingent on one thing. It is rare for a Conservative MP to praise a man called Barroso, but I am grateful to Mr Barroso for his amazing contribution to this debate, because the European leaders have made it acutely clear that, regarding the immigration control situation, were Scotland to go independent, it would have to apply to join the EU. That is not going to happen. [Interruption.] The hon. Member for Na h-Eileanan an Iar laughs and chunters, as always, from a sedentary position, but can he name an individual European politician—I will happily give way to him on this point—who has said that the border control situation will be acceptable if Scotland does not join the EU, and that it will be no problem at all?

[Mr MacNeil]

The hon. Gentleman will, of course, be aware of the example of the Republic of Ireland, which is in the EU and the common travel area and not in Schengen.

[Guy Opperman]

Answer came there none, I am afraid.

[Phil Wilson]

People leaving southern Ireland and going to Belfast do not have to show their passports, but if they continue their journey to Liverpool by ferry, they do.

[Guy Opperman]

It is worth assessing the UK Government’s position, which is that if Scotland were to become an independent state, the boundary between Scotland and the rest of the UK would, by definition, become an international border between two separate states, with everything that that entails. The evidence locally in the north-east, whether from farming bodies or the North East chamber of commerce, is extensive: there is huge concern that this will have an impact on trade, businesses and jobs. I met a number of oil and gas producers, several of whom are building huge sites on the Tyne at the moment. Hon. Members know that the two biggest construction sites are for construction projects in the North sea. The producers are concerned that, if there were independence, those projects would be affected, and there would be greater difficulties.

It is, self-evidently, for the Scots to make this decision, but it is incumbent on all of us, not just—with great humility and respect—to analyse the weak arguments of the SNP, but to make the case to all the Scots whom we know, and to get up to Scotland and encourage all those in Scotland to analyse deeply whether they wish to do this, because, self-evidently, we are better together.

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[Mr MacNeil]

The hon. Gentleman asks a fantastic question, which gives me the opportunity to outline the point of the SNP, which is to put the Scottish people first, rather than power struggles in London, which, unfortunately, is the point of the London parties. It is all about who is in government in London, and that is not for the good of the people of Sighthill, Springburn, Castlemilk, Fort William, Inverness, Sutherland, Lochaber, Skye or Lewis. That is an awful tragedy. It should also be in our interest in Scotland to ensure that the good people of the north-east of England are benefiting as much as those in the regions of Scotland. I look forward to the day I witness people from the north-east of England finding chances of employment in Scotland, rather than having to go far afield to the south-east of England.

[Guy Opperman]

May I return the hon. Gentleman to the key issue of currency? Will he state for the House’s benefit what his proposal is on currency? Under the present position on a sterlingisation approach, he would surely be borrowing in a currency over which he had no control and in a monetary environment that is unsustainable in the long run for investors, who are so key to jobs and business prosperity.

[Mr MacNeil]

The reality, as he well knows, is that after the referendum victory on 19 September, George Osborne will take a different approach from his arrogant, dismissive bullying of the Scottish people. He will find some humble pie and dine on it very heartily. George Osborne understands the importance of his balance of payments and does not want to weaken sterling. Or is the hon. Gentleman saying that he would like to see sterling weaken? He knows that that is what will happen if Scotland is not in the sterling area. Does he disagree with that?

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[Mr MacNeil]

I hear Members, including no less a figure than the Minister, cackling and heckling. The same fears and nonsense about the idea that we would be diminished were no doubt present when Ireland and some of the Dominions were moving towards independence, but I argue that they were wrong. There is more trade between the UK and Ireland now than there ever was when Ireland was part of the UK. Things are better, and the aggregate GDP of the British Isles is higher because of an independent Ireland and an independent Isle of Man. It will be higher still when we have an independent Scotland, because of the giant suction machine that the Secretary of State for Business, Innovation and Skills alluded to. There is an issue, but the best way to solve it is to create a successful second centre of gravity in the island of Britain. The island of Ireland probably benefits from having two Governments, although it has not been helped by the psychopathic elements who have been involved over the past 100 years.

[Guy Opperman]

It is hard to follow the hon. Gentleman’s speech, but we are all trying. Can he enlighten us when it comes to the Barnett formula? If Scotland were to go independent, presumably that formula would not continue to operate and the hon. Gentleman would not seek for it to do so, given that Scotland would be an independent state. What is the SNP’s position if it loses the referendum? Will he decide that Scotland does not need the Barnett formula?

[Mr MacNeil]

The hon. Gentleman is quite correct to say that if Scotland were independent, it would not seek to operate a Barnett formula any more than Norway does. In Norway, of course, average wages are twice those in the UK, on a population of a similar size to that of Scotland with oil.

The hon. Gentleman asked what would happen if the referendum were lost. First, I do not think that the referendum will be lost, and secondly, the SNP will do what we always do, which is to put the interests of Scotland first. He should be aware that Scotland is 8.4% of the UK’s population and raises 9.9% of the UK’s taxes, and that over the past five years, taking tax and spend together, Scotland was £12.6 billion relatively better off.

If the hon. Gentleman is exercised by the Barnett formula, and he clearly is, the best thing that he can do is to join his brothers in Scotland and support independence, and then he can stop worrying about it. He will no longer be troubled by the green-eyed monster when it comes to someone getting a fraction more or a fraction less. Actually, that concern should not exist because, as I have pointed out, Scotland contributes 9.9% of the UK’s taxation although it accounts for only 8.4% of its population. In each of the past 32 years, Scotland has contributed more tax per person than the UK average.