Scotland’s first minister says Theresa May’s plan to take UK entirely out of EU single market could be economically catastrophic

Nicola Sturgeon has signalled that Theresa May’s decision to take the UK entirely out of the EU single market makes a second Scottish independence vote very likely.

Accusing May of pursuing a hard-right, divisive agenda, Scotland’s first minister said quitting the single market could be “economically catastrophic”. It was against Scotland’s national interests, she said, and raised fundamental issues about what kind of country the UK would become.

Sturgeon said the prime minister had to urgently address the conflict between her decision to entirely quit the single market with the Scottish government’s counter-proposal to give Scotland its own special access to the EU. Scotland’s Brexit minister Mike Russell is due to present the Scottish government’s EU plan to David Davis, the UK’s Brexit secretary, this Thursday during joint ministerial talks on Brexit between the UK and devolved governments, in what is expected to be a tense and difficult encounter.

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With Scottish opinion polls showing declining support for a snap second vote on independence, Sturgeon carefully avoided using the words “independence referendum” in her statement on May’s speech. She had insisted earlier this month she was not bluffing about her threat to stage one, before conceding no referendum was expected this year.

Challenging May’s renewed pledge on Tuesday to carefully consider Scottish proposals, Sturgeon said: “One thing should remain crystal clear: the Tory government cannot be allowed to act against Scotland’s wishes and our interests, and reject all attempts at compromise.

“It seems the Westminster Tory government now think they can do anything to Scotland and get away with it. They must start to understand how wrong they are. The UK government cannot be allowed to take us out of the EU and the single market, regardless of the impact on our economy, jobs, living standards and our reputation as an open, tolerant country, without Scotland having the ability to choose between that and a different future.

“With her comments today, the prime minister has only succeeded in making that choice more likely.”

Sturgeon dismissed May’s explicit assurances the UK would import all EU laws immediately after Brexit, particularly protecting workers and EU citizens rights. The first minister accused her counterpart of plotting a low-wage, low-tax economy in a “race to the bottom”.

Despite rejecting Sturgeon’s core demand on single market access for Scotland, May said she wanted to work constructively with the Scottish government and the Welsh and Northern Irish devolved administrations. She said she was determined to strengthen the “precious union” between the UK’s four nations.

“At this momentous time, it is more important than ever that we face the future together, united by what makes us strong: the bonds that unite us as a people, and our shared interest in the UK being an open, successful trading nation in the future,” May said.

Yet she appeared to close down those options further by warning that Sturgeon was unlikely to win all the extra powers for Holyrood she would like.

May said Scotland would gain greater political and policymaking powers once the EU’s powers were repatriated. But she failed to set out what those might be and implied they would be limited. She stressed those would be the “right” additional powers and warned: “We won’t agree on everything.” She then hinted some Scottish demands for increased autonomy in areas such as immigration, trade or employment policy would be rejected.

“Our guiding principle must be to ensure that, as we leave the European Union, no new barriers to living and doing business within our own union are created,” May said.

“That means maintaining the necessary common standards and frameworks for our own domestic market, empowering the UK as an open, trading nation to strike the best trade deals around the world, and protecting the common resources of our islands.”

May’s stance put a cross-party consensus on Scotland’s first response to the June referendum vote under further deep strain. Some Scottish Green MSPs have urged Sturgeon to begin preparing for a second referendum. Ross Greer, the party’s external affairs spokesman and a former Yes Scotland official, suggested it could be held in spring 2018.

Kezia Dugdale, the Scottish Labour leader, agreed with Sturgeon’s case for continued Scottish access to the single market. But she said pressing for a second independence referendum would be a disaster for Scotland. “Scottish Labour will not back any attempts by the nationalists to force another independence referendum on the people of Scotland,” said Dugdale. “We need to reform where power lies within the UK.”

The Scottish Tory leader Ruth Davidson, who campaigned for a remain vote in the referendum, challenged Sturgeon to accept that May was offering a “clear and reasonable plan” that met many of Sturgeon’s demands, including protection of workers and EU citizens’ rights.

“Ever since the Brexit vote, the SNP has tried to use the result as an excuse for holding a divisive second referendum on independence,” Davidson said. “It has failed to persuade people in Scotland of that case. Now that the UK government has spelled out this plan of action, that case has collapsed altogether.”

Later, in an interview with the BBC following May’s speech, Sturgeon went further by agreeing with a question on whether the prime minister’s rejection of the single market option made a new independence referendum “all but inevitable.”

Sturgeon replied: “Well, I think that is very likely the case. Because what I have heard today from the prime minister is her inability to engage in discussions about further compromise.” She believed Scottish voters had the right to choose between May’s vision for the UK outside the EU or “an independent future” for Scotland.