Ruth Davidson’s departure doesn’t mean the end of the Union

The departure yesterday of Ruth Davidson as leader of the Scottish Conservatives has prompted much discomfort among some pro-Union commentators. There is no doubt that she was a stunningly effective campaigner but it is an exaggeration to claim that the revival in the fortunes of the Scottish Conservative and Unionist Party was solely down to her.

Davidson received a substantial boost from the fact that the Scottish independence referendum in 2014 redrew the Scottish political map, creating a binary division between pro-independence and pro-union forces. In the aftermath of the vote, Davidson was by far the canniest operator, ensuring the Tories were the most staunchly pro-union party. But whoever her successor is will have been helped by John McDonnell and Jeremy Corbyn throwing Scottish Labour under a bus by indicating that they would not block a second referendum in exchange for SNP votes in the “English” parliament.

Davidson’s successor will also have another simple advantage: Scotland benefits significantly from being part of the United Kingdom. Last week’s release of the Government Expenditure and Revenue Statement (GERS) showed that Scotland benefits from the Union to the tune of £2,000 per person per year through fiscal transfers.

At this point, I’d like to declare a new law of political discourse, possibly “Hague’s Law” in honour of Kevin Hague, serial entrepreneur, chair of the pro-Union think tank These Islands, GERS obsessive, and scourge of the Twitter cybernats. This law says that:

As an online discussion on Scottish independence grows longer, the probability that the pro-Union participants will be accused of believing Scotland to be “too wee, too poor, too stupid to be independent” approaches one.

It doesn’t matter whether you’ve said anything of the sort. You’re just accused of being dismissive of Scotland, regardless of whether you’re Scottish yourself, and therefore anything that you might have had the temerity to present as “facts” are questionable due to your motivations.

First, the idea that Scotland’s problem is that it’s “too wee” is nonsense; if anything, the trouble is that it’s too big! Scotland has only eight per cent of the UK’s population, but makes up a third of the land mass of Great Britain and has nearly half its coastline; it has 38 of the 59 most populated islands in the UK; It has an average population density one-sixth that of England. Scotland’s population is extremely thinly spread.

This has an obvious implication for transport in particular. Scotland has around 22 per cent by mileage of Great Britain’s trunk roads and 18 per cent of its railway network. Rail subsidy per journey in Scotland is £6.14 compared to £1.79 in England. The Scottish government also needs to purchase and operate ferries to serve the island populations.

Providing health and education to Scotland’s more remote communities is expensive. The Highlands region has a density of just nine people per square kilometre compared to a UK average of 270. Scotland also has around 15 per cent of the UK’s nurses, health visitors and midwives and nine per cent of the teachers.

All of this means that it is simply more expensive to provide UK citizens with the same standard of public services as England. Taking GERS at face value, and considering that Scottish public services are not noticeably superior to English ones, we can say that it probably costs around £1661 extra per head to provide these services.

That is not a figure that independence can change. In the absence of a fiscal transfer that means that either taxes go up, or spending comes down. And if spending comes down, it will be the Highlands and Islands that will notice the biggest deterioration, with some communities, already struggling, becoming unsustainable. Somehow, I doubt the SNP would want to be known for instigating a new wave of Highland clearances, but that could be a consequence of independence.

In terms of “too poor”, it depends what you mean. Let’s ignore the higher spending requirements for now. The ONS shows that Scotland is actually one of the best performing parts of the UK, behind only London, the South East and the East of England in terms of revenue generation per head. Indeed, GERS shows that Scotland’s onshore GDP per capita grew at two per cent compared to the UK average of 0.9 per cent. However the UK government’s economic policy affects Scotland, it clearly is doing a better job than it is in the North of England, Wales or Northern Ireland.

But wealth generation is not static. Scotland’s population is ageing more rapidly than the rest of the UK, with the lowest fertility rate of any part of the Union and low immigration. The number of taxpayers is declining and will continue to decline on current trends. This inevitably means that tax revenue will decline while pension costs will increase.

Currently pensions are paid by the UK Exchequer on an equal basis to all UK citizens. Could an independent Scotland maintain pensions at their current level (particularly in their proposed new currency) even while those costs rise?

In terms of employment, around 21 per cent of Scottish workers are employed in the public sector compared to a UK average of 16.4 per cent. If the state had to cut spending then it would have a disproportionately large effect on Scottish jobs and the associated tax returned.

Another frequent criticism of GERS is that it says nothing about how those figures would change in an independent Scotland that had full control of its laws and taxes. This is true (although usually deployed as yet another straw man) but no-one seems to have many concrete proposals as to what those changes would be, bar saving £200m per year on contributions to the upkeep of Trident. However, I think it is reasonable to suppose that an SNP government would not be predisposed to major tax cuts to stimulate economic activity, not reducing regulation to ease the burden on businesses – just ask Ineos.

So no, Scotland is not too poor, but it is likely to get poorer over time principally through demographic change, while the rest of the UK gets wealthier. The fact is that London is an economic superpower, drawing talent from all over Europe and the World including Scotland, but, unlike, for example, France, at least Scotland benefits from sharing the tax revenue London generates. And London is not going to disappear just because a border is imposed between Scotland and England. Talent will still migrate there.

The final question to be considered regards “too stupid”. I’m with Mrs Gump on this one – “Stupid is as stupid does”.

Despite what nationalists say about other small countries achieving independence, there is simply no precedent for a wealthy modern state fracturing as they propose. Looking at a list of “new” countries, new states formed in the last century are predominantly ex-Soviet republics, Balkan states, and former European colonies. And whatever some wilder Nats will say, Scotland is not a colony.

Independence would therefore require taking an unprecedented action, likely sparking an economic crisis, walking away from a successful union which guarantees the current level of provision of essential public services, while facing serious demographic challenges that will only worsen. 

That doesn’t seem too clever to me. Ruth Davidson was great at making the case for the Union and she will be sorely missed. But whoever replaces her will still have the facts on their side.