Scottish independence: UK relationship 'will be rich and close'

The Scottish government says that if Scotland becomes independent, its future relationship with the rest of the UK will be "as rich and close" as the current relationship between the UK and the Republic of Ireland.

A White Paper just published by the Scottish government says independence will "recognise the distinct political identities of Scotland and the rest of the UK and allow us to work together in a more democratic environment with a renewed partnership as close allies and friends."

It says the Scottish government "plans a substantial diplomatic presence in both London and Dublin and will be active participants in the British-Irish Council, the secretariat of which is already based in Edinburgh."

The Scottish government says "it is in the interests of an independent Scotland and the rest of the UK to share a currency and a Common Travel Area, meaning there will be no need for passports, exchanges or border checks."

It adds that "there are no circumstances in which the Scottish Government would countenance any measure being taken that jeopardized the ability of citizens across the rest of the UK and Ireland to move freely across our borders as they are presently able to do.

"It is for this reason that, following independence, Scotland will remain part of the Common Travel Area (CTA), which dates back to the 1920s."

The White Paper says an independent Scottish government will maintain a network of diplomatic offices, including one in Dublin.

'Attractive economy'

It points out, by way of comparison, that the Irish Republic "maintains permanent representation at the Council of Europe (Strasbourg), the OECD and UNESCO (served by the same office in Paris), the OSCE (Vienna), the UN (Geneva and New York), NATO Partnership for Peace (Brussels) and the EU (Brussels)".

The Scottish government intends to reduce corporation tax in an independent Scotland by up to three percentage points below the prevailing UK rate.

The White Paper on Scottish independence says setting a competitive rate of corporation tax "can send a clear signal that Scotland is one of the most competitive and attractive economies in Europe, with tax rates designed to boost economic activity and support the fast-growing industries that already have a comparative advantage here in Scotland.

"Corporation tax rates remain an important tool for securing competitive advantage and for offsetting competitive advantages enjoyed by other parts of the UK, notably London."

The devolution of corporation tax has been a long-standing demand from Stormont politicians, who argue they need to reduce the tax to match the much lower rate in the Republic of Ireland.

The UK Treasury says it will not make any decision on devolving corporation tax until after the Scottish independence referendum has taken place.

There is no reference in the White Paper to the block grant currently paid by the UK government to Northern Ireland, with a subsidy estimated to be around £7bn - £8bn a year. However, the Scottish government does say it will pay its "fair share" of the UK's shared liabilities.

(N.B. Since I wrote that sentence, this report has been brought to my attention, estimating the NI fiscal deficit at £10.5bn).

The White Paper says: "Scotland and the rest of the UK will agree a share of the national debt. This could be on the basis of our historical contribution to UK revenues or on the basis of our population share".

However, it also argues that an independent Scotland would be "entitled to a fair share of the UK's assets" which it estimates to be worth £1,267bn.

Whilst the Scottish government intends to retain the monarchy, it will use the Saltire or Cross of St Andrew as its official flag.

National flag

The White Paper says: "It will be for the rest of the UK to decide what its flag will be. It is possible for the rest of the UK to retain the Union Flag if that is what it wants. The Union Flag, the first version of which dates from 1606 - before the political union of 1707 - could be used in Scotland as people think fit. For example, the Union Flag is flown in some Commonwealth countries along with the country's own national flag."

The Scottish government intends to replace MI5, MI6 and GCHQ with a single security and intelligence agency. It says the agency will work very closely with the UK's intelligence agencies in order to "ensure the security of Scotland and the rest of the UK".

The White Paper proposes that BBC Scotland will be replaced by a new Scottish Broadcasting Service, which will continue to be funded by a licence fee. The Scottish government believes the new SBS will be able to provide a high quality service on TV, radio and online without following RTE's example and seeking revenue from advertising.

The paper predicts that Scottish TV viewers will still be able to receive BBC TV services and points out that: "BBC channels that are available in the UK currently are also already available through different live transmission agreements in the Republic of Ireland, the Netherlands, and Switzerland".

An exhaustive list of answers to potential questions contained in the White Paper also assures people there will be no security posts on the land border between Scotland and England and that, "as a matter of common sense", Scotland will retain the same time zone as the rest of the UK.