A bankrupt economy, North Sea oil rights sold to China and Shetlanders defecting to Norway. What if Scotland DID go it alone?

Leading historian Andrew Roberts predicts that an independent Scotland would soon be begging to be part of the UK again.

Alex Salmond: The SNP victory in the independence referendum of Tuesday, June 24, 2014 was impressive by any standards

The SNP victory in the independence referendum of Tuesday, June 24, 2014 was impressive by any standards.



Despite being held on the 700th anniversary of the battle of Bannockburn — where Scotland’s Robert the Bruce defeated the English forces under Edward II — few independent commentators thought that as many as 60.4 per cent of Scots would vote Yes to the question ‘Do you think Scotland should become independent and leave the United Kingdom?’

Only 38.4 per cent voted No.

The personal success this represented for Alex Salmond was acknowledged by British premier David Cameron with characteristic generosity: ‘Mr Salmond has won a famous victory, and now we in the UK thank the Scottish people for our three centuries of union with them. We wish Scotland well, and hope it has a bright future.’

Sadly, it was not to be.

The first problem the new Prime Minister of Scotland faced — ‘First Minister’ was dropped for being a ‘condescending English phrase’ — was the downgrading of the new Scottish currency, the groat, by the international markets.

Unlike the Union flag, which was quickly replaced by the blue and white of the saltire, Salmond had originally hoped to keep the pound sterling. But the British Chancellor George Osborne explained that all decisions concerning money supply would be taken solely with consideration for UK, not Scottish, interests.

Salmond’s hopes that the groat might enjoy parity with sterling, even perhaps ‘track it’ as sterling once did the deutschmark, were destroyed by speculators’ concerted attacks on it on the international stock exchanges.

The United Kingdom — which kept its name as it still united England, Wales and Ulster — had the Bank of England to step in and support the pound, buying enough sterling to deter such bullying tactics by the markets.



Could Orkney and the Shetland Islands declare their own independence in 2015 or might the islanders defect to Norway?

St Andrew's Cross: The blue in the Union flag would be lost forever if Scotland decided to become independent

But all the Salmond government could do was to raise interest rates, with its own disastrous effect on the rest of the economy.

Small wonder, then, that after Scotland lost its AAA credit rating from the agency Standard & Poor’s, it quickly looked to Brussels to help it out.

Yet it was to be bitterly disappointed. Under normal circumstances the European Union would have been delighted to have a new member state such as Scotland, especially a refugee state from the UK, but the economic circumstances of the summer of 2014 were not normal.



With Greece having left the eurozone, and Portugal and Italy still seen as economic basket cases, neither Chancellor Angela Merkel of Germany nor President Francois Hollande of France (the Socialist elected to replace Nicolas Sarkozy two years earlier) wanted to take on another small country. Especially as the exact breakdown of national debt between Scotland and the rest of the UK had still not been finally ratified by either parliament.

Proportionately by population, Scotland was set to inherit £110 billion of Britain’s £1.4 trillion national debt, which would cost it £3.2 billion a year to service at 4 per cent interest.



All alone: Perhaps an independent Scotland will face nerve-wracking moments over the price of oil in the North Sea

It was lucky for Scotland that Gordon Brown's Labour government had sunk more than £70 billion into Royal Bank of Scotland and HBOS in October 2008, something an independent Scotland could never have afforded

But the World Bank and the IMF — asked to broker a deal on debt between London and Edinburgh — were profoundly split on whether population or economic performance should be the criterion.

The uncertainty meant EU membership for Scotland looked just too risky a proposition, so the Scots were put behind the Croats in the queue to join.

Before independence it was argued by SNP constitutional lawyers that Scotland would somehow automatically ‘inherit’ its place in the EU because they’d been a member when part of the United Kingdom. But that was not accepted by the powers in Brussels, and the six Scottish MEPs were expelled from the Strasbourg parliament on the same day 72 Scottish MPs said farewell to Westminster.

As it turned out, Scotland’s representation in other counsels of the world also suffered.

She was not admitted into Nato, as her aggressive de-nuclearisation programme and inability to meet the necessary spending requirements on defence disqualified her.

At the same time the UK began to recruit Englishmen, Welshmen and Ulstermen to fill gaps in the armed forces previously occupied by Scots.

Scotland was welcomed into the Commonwealth, of course, but found no place at the G7, G8 or G20, as she had while part of the United Kingdom. Her seat in the United Nations was also delayed for a long time by the Russians, who objected to their having a place when the Kurds, Palestinians, Tibetans and other ethnic groups did not.

When Alex Salmond pointed out that unlike them the Scots had a state of their own, President Putin merely shrugged and was overheard to make a racially offensive remark about haggis.

The inability to attain early EU membership meant passport controls were erected along the border between Scotland and England, as well as at the former domestic arrivals areas of Glasgow and Edinburgh airports.



Bravehearts: But would proud Scots regret a split from the Union?

A million Scots living and working in the UK and 400,000 Anglo-Scots living in England, as well as the half of the Scottish population with relatives in England, found it highly inconvenient.

It also meant taxes levied on ‘non-doms’ — rich foreigners working in the UK — included any Scot who earned enough.

And when it was realised there were now customs, immigration and money-changing issues attendant on visiting Scotland, the popularity of the independence movement really waned.

Especially when it led to millions of tourists opting for drier climes, which badly hit the tourist trade, Scotland’s second biggest foreign currency earner. In retrospect, the moment in June 2015 when the Orkney and Shetland Islands declared their own independence from Scotland, and their intention to become part of Norway, taking with them 23 per cent of Scotland’s North Sea Oil revenues, was the turning point.

The Edinburgh parliament, having done the same thing to Westminster the previous year, could not stop the referendum taking place, in which the Hebrideans voted by 71 per cent to leave Scotland the following March.

Queen Elizabeth kindly agrees to remain monarch of Scotland and continues her trips to Balmoral unaltered

As an autonomous region of Norway, the Hebrides soon turned out to be among the richest people per capita in the Northern Hemisphere.

Further talk about the Highlands splitting off from the Lowlands placed the Scottish Royal Family — the Queen had agreed to remain monarch of Scotland — in a difficult political dilemma.

Her Majesty the Queen did well to ignore it all by continuing her trips to Balmoral unaltered.

‘We had to put up with this kind of thing a lot with Quebec [and its attempts to secede from Canada] in the 1970s,’ she remarked to Alex Salmond at the Braemar Games, to his obvious irritation. Though foolhardy in the long-run, it was brave of Salmond to deliver on his pre-independence promises to increase spending on pensions and higher education, despite it plunging his new country further into the red.

With a population of 5.2 million and an economy worth just over £120 billion in 2016, Scotland faced a nerve-racking moment when the price of oil dropped to $45 a barrel as a result of Venezuelan President Hugo Chavez’s death, Libyan oil production coming on-stream and Saudi Arabia increasing production after the fall of President Assad in Syria.

Always something of a single-product economy, the Scottish balance of payments was knocked wildly off course by these events, which the Scots could have taken in their stride if they were still part of a larger economic entity, as they had been for 300 years previously.

It was lucky for Scotland that Gordon Brown’s Labour government had sunk more than £70 billion into Royal Bank of Scotland and HBOS in October 2008, something an independent Scotland could never have afforded.

Taken together, the assets of those banks amounted to more than 13 times Scotland’s annual economic output by 2012. But when in 2014 George Osborne insisted on Scotland picking up its fair share of the £1.25 trillion of total liabilities taken on by the UK in rescuing the banking sector, Scotland’s balance sheet looked as rocky as the Highland mountains. Soon, the country found it needed more than rapidly-dwindling North Sea Oil to keep it afloat.



PM George Osborne: After only four years of independence, in June 2018, Wendy Alexander made a momentous visit to Downing Street

Scottish oil production had peaked more than a decade and a half before, and significant further declines in production were forecast by most analysts.

The bleak picture moved Alex Salmond to take the greatest risk of his career in the autumn of 2016. He offered to sell 20 years of future oil production to the China National Offshore Oil Corporation, in return for it paying off Scotland’s entire national debt and being given a £82 billion sovereign wealth fund — and two more pandas for Edinburgh Zoo.

Yet for the Chinese deal to go through, Salmond needed the support of the Holyrood parliament in Edinburgh, but Scottish National Party members, as well as Labour and Lib-Dems MPs, opposed having the saltire flag dragged down from the oilrigs so soon after it had been raised over them, to be replaced by Beijing’s red flag.

The cry: ‘Better the Commies than the Sassenachs’ was heard from some Clydesdale members, but Scottish patriotism prevailed. When it was pointed out Scotland had no navy to enforce the agreement and Nato would not help, let alone the UK, Salmond argued he would appeal to the Council of Europe if Beijing misbehaved in the North Sea at the end of the deal.

Salmond’s defeat in the 2018 elections, and his replacement as Prime Minister of Scotland by Labour’s Wendy Alexander, the former MSP for Paisley North, was perhaps inevitable.

After only four years of independence, in June 2018, Wendy Alexander made a momentous visit to Downing Street, where she was greeted by the new British Prime Minister George Osborne.

‘You’ll know why I’ve come, George,’ said Mrs Alexander once inside. ‘I’m afraid I can’t begin to imagine,’ joked No 10’s new occupant. ‘Do enlighten me.’

‘It seems our forefathers knew more than we guessed when they united our countries for 300 years,’ replied Wendy Alexander somewhat grandiloquently.

‘Scotland would formally like to request re-admittance into the United Kingdom. Let us restore the blue to the Union Jack; let Scottish passports be consigned to the dustbin of history.’

Osborne looked at Mrs Alexander for a moment, considering hard the effects of another 5.2 million people on the books of the NHS and the huge increase in Britain’s welfare and benefits bill — let alone having an extra 41 Labour MPs sitting opposite him in the Commons.