SNP Win - The Economics of D-I-V-O-R-C-E

Generali

From an economic standpoint, a split between England and Scotland would be fascinating (for me). I don't have answers to what would happen but would like to kick off a conversation.

Given that Scotland was, AIUI at least, basically broke when they joined the Union, how would the national debt be split between the remnants of the UK and Scotland? Would you use the Barnett(sp?) Formula for example, ie Scotland gets a higher spend per head so gets more debt per head?

What about the bank bailout? The biggest part of the bailout was HBOS and RBS. Presumably any transfer of the bank assets would include also passing on the bank liabilities. Could Scotland sustain that given that the liabilities of those banks must be 1 year's GDP for Scotland easily?

Then there's oil. Contracts were signed with the British Parliament, not the Scottish Parliament and at the time it was British oil. Can the SNP unilaterally decide that the oil belongs to Scotland when MPs that were returned by Scotland to Westminster were a part of passing legislation allowing drilling in the North Sea and the money pass to The Treasury rather than just Scotland?

I wonder if they'd keep The Queen? James I of England was king of England and Scotland so there is precedence. If not, what would happen to her Scottish assets and also the assets of the Crown Estate? Would she keep Holyrood for example?

tomterm8

There are some other questions. As such, the British state was admitted to the EU. If Scotland leaves the UK, it would technically also have to negotiate joining the EU. Otherwise, scottish people would lose their EU citizenship. They wouldn't have automatic access to the EU market.

What happens to the nuclear weapons?

And how does Scotland pay for it's own services? Many people employed in scotland are employed by the British government, to do services for the UK as a whole. Many of these jobs would naturally be relocated.

purch

It's very easy at the moment to be a SNP politician.

You get to spend the money, but don't have to raise the money.

It's win win, as the latest polls show.

Whether or not they would be as popular if they had to raise the money for their generous schemes is open to Q.

IronWolf

Its just complicated to ever happen. Scotland dont even have a military, and theres no way England would give up the North Sea oil revenues which Scotland would need in order to raise any money at all.

ninky_2

there's only one way to decide....

FIGHT!

i guess that's what it would come down to. in the considered event of disagreement who has the greater military might.

scotland might do better in a glasgow kiss situation not so sure in a fight over oil.

Generali

tomterm8 wrote: »

There are some other questions. As such, the British state was admitted to the EU. If Scotland leaves the UK, it would technically also have to negotiate joining the EU. Otherwise, scottish people would lose their EU citizenship. They wouldn't have automatic access to the EU market.

What about NI/Eng/Wales (let's call it NEW)? Would they remain as members of the EU/NATO? What about the permanent seat on the Security Council of the UN? Would all that need renegotiating? Imagine a solidly Tory NEW trying to renegotiate EU membership in the current economic climate:eek:

tomterm8 wrote: »

What happens to the nuclear weapons?

They move to England or are decommissioned. The SNP doesn't want nuclear weapons.

tomterm8 wrote: »

And how does Scotland pay for it's own services? Many people employed in scotland are employed by the British government, to do services for the UK as a whole. Many of these jobs would naturally be relocated.

The SNP and many Scottish people believe that 'their' oil revenues are greater than the subsidy that the South East of England sends to them. I have my doubts but time will tell if Scotland gains independence.

IronWolf

I honestly dont think it will ever happen, the Scottish people don;t want it

mbga9pgf

It would destroy Labour. More of a fan with every day! I would love to see the abandonment of the Barnett formula, not to mention the fact that Scots can vote in westminster, yet we cant return the favour.

The oil by the way is not scottish. When it was discovered, the definition of territorial waters does not extend to the oil fields, and the definition of economic Zones did not exist internationally to 1982. The fields belong to BP and Shell just as much as they do the British, or indeed, the scots.

Really2

Even if they got the oil, the revenues are falling.

If they can't support their selves without oil (it will run out one day) they have little choice. They can't base their independence on just oil revenues.

£33,523,800,000 Is their 2011/2012 budget.

How much of a dent would oil revenue make in tax?

chewmylegoff

Generali wrote: »

What about the bank bailout? The biggest part of the bailout was HBOS and RBS. Presumably any transfer of the bank assets would include also passing on the bank liabilities. Could Scotland sustain that given that the liabilities of those banks must be 1 year's GDP for Scotland easily?

I've seen some interesting stats on the scottish economy, prepared for the purpose of demonstrating that devolution was the holy grail. They showed that if you include the oil revenue on the basis of geographical location of the oil fields (which seems fairly reasonable), that the scottish economy is currently in surplus.

In the small print, however, they noted that they had excluded all of the banking bailout costs because that was an "english" problem.

I say, we let them give us HBOS and RBS, as long as they agree to take Wales with them.

FTBFun

I would be surprised if Scotland became independent any time soon.

For starters, Salmond is on record as saying that an independent Scotland would aim to have a similar economic pattern as Ireland. Probably not the best approach now.