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Scoxit could lead to Brexit

12 May 2014 By Hugo Dixon

If the Scots vote to leave the UK in September, that could trigger a chain reaction which leads to the rest of the UK quitting the European Union. This is a threat British pro-Europeans need to take seriously given that a Scottish independence vote is quite possible, though the chances are still less than 50 percent.

Were it not for the Scotland factor, the risk of a so-called Brexit – Britain’s exit from the EU – would be receding. A string of business leaders have in recent months come out and argued that the economy would be damaged if the UK lost full access to the EU’s single market.

All the opinion polls by YouGov since the start of March have shown a lead, varying between 2 and 6 percentage points, for Britain wanting to stay in the EU. In the previous year, YouGov’s polls were consistently in favour of pulling out with one showing a lead of 17 points for the “Out” campaign. 

This switch-around has happened despite the fact that the UK Independence Party, which wants to pull out of the EU, is expected to get the most votes in this month’s European Parliament elections. UKIP’s rise, on the back of leader Nigel Farage’s formidable debating skills, seems driven more by disaffection with London politics and immigration than a strong desire to quit the EU.

But a vote for Scottish independence would change all that. And here the polls are moving in the opposite direction. Until a year ago, the idea that Scotland would quit the UK seemed a remote possibility. But in one ICM poll last month, 42 percent of those quizzed said they wanted to stay in the UK versus 39 percent who wanted to quit.

Alex Salmond, the Scottish nationalist leader, is running an effective populist campaign. The odds from betting house William Hill currently imply a 30 percent chance of a “Scoxit” – Scotland’s exit from the UK.

Such a scenario would increase the chances of a Brexit for four reasons.

First, the Scots are more pro-EU than the other Brits. If there is a referendum on Britain’s EU membership in 2017, as Prime Minister David Cameron has promised, the Scots won’t vote and it will therefore be a little harder to persuade the rest of the UK to stay in. The absence of Scotland might deprive the “in” campaign of 2-3 percentage points of “net” pro-EU votes. That could be decisive in a tight race.

Second, the chances that Britain will hold a referendum will shoot up because it will be more likely that there will be a Conservative government in 2017. At present, the Labour opposition has 41 members of parliament (MPs) from Scotland while the Tories have only one. The UK has 650 MPs in total. If the Scottish MPs were excluded, it would be harder for Labour (which has pretty much said it won’t call an EU referendum) to run the country.

This doesn’t mean Cameron will necessarily win the next general election in May 2015, because the Scots will still get to vote even if they back independence this September. It will take at least until March 2016 for Scottish independence to become effective. Ed Miliband, the Labour leader, might well become prime minister in 2015.

The snag is that, once Scottish independence does become effective, Scotland would lose its MPs in Britain, and Miliband, if he was prime minister, would probably lose his majority. Either there would then be a new general election, which Miliband would probably lose, or Miliband would immediately be replaced by a Tory prime minister, who would then call a referendum on EU membership.

That new Conservative prime minister almost certainly wouldn’t be Cameron. If he had lost both Scotland and a general election in quick succession, he couldn’t stay as leader. In fact, he might even be kicked out before next year’s general election if the Scots vote for independence, such would be the blow to national pride.

The possibility that a Scoxit vote could lead to a new Tory leader is the third reason why it would increase the chances of a Brexit. Cameron is a luke-warm pro-European. He would probably be replaced by a more eurosceptic leader who might actively campaign to pull Britain out of the EU.

The final reason why Scoxit might lead to Brexit is linked to Cameron’s strategy of renegotiating Britain’s relationship with the EU before holding an In/Out referendum. He hopes to use the concessions he has won as a strong reason for voting to stay in.

The problem is that, if Scotland votes for independence, there will then be a messy argument over the divorce terms. Brussels will also need to negotiate the terms of Scotland’s admission to the EU, which won’t be easy either.

Will both London and Brussels be able to focus on renegotiating their own relationship when they are tied up bargaining with Edinburgh? There has to be a risk that they won’t and that, therefore, Cameron’s strategy of going to the electorate with a new deal on Europe in 2017 will be in tatters. That, in turn, would make it harder for the “in” campaign to win a referendum.

In other words, Salmond may be as big a risk to Britain’s EU membership as Farage.


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