The vote was NO to independence in Scotland. By a convincing margin. But support for more powers to Scotland that independence would have offered had grown since the first of three referenda conducted in March 1979. So the issues that led to the vote and the need for reform are not going away.
Back in 1979, Scotland was not asked to decide on separation, but merely on approving the terms of legislation passed the previous year which would have devolved some powers to Scotland. Making it difficult to achieve, the terms of that poll in the 1970s meant that a YES vote would have had to be at least 40%. It just fell short. This in part was caused by a low turnout of 64%. Many saw it as a fudge, but certainly, this time around, with powers already devolved following the 1997 Referendum, Scottish support for more powers – the ultimate prize of independence – was up at 45%. And the decision to make was a far more stark one. This was not about devolution, but clean break away. London had scared Scots and the SNP had failed to reassure Scots.
The opinion polls were right. But the Scots have a long tradition of canny decision-making and kept their real views quiet until it mattered. With nearly 10% undecided before September 18, it was always going to be an interesting poll.
But Scotland has spoken overnight and now come the financial consequences. Talk of a Great Depression in Scotland had they voted YES may have been averted. Lucky Scots. But already analysts like Howard Archer have made the claim that a NO vote has speeded up the likely date by which UK interest rates will rise, to as early as the start of 2015. Unlucky Brits.
So expect to make higher mortgage payments within a year.
In essence a yes vote would have made it harder to raise rates because of possible monetary turmoil following separation. Without that instability it will be easier to press on with UK rate hikes. Some cynics might even claim Bank of England governor Mark Carney’s disquiet over whether Scotland could continue to use the pound came from a desire to make his own job easier than serving the mutual interests of Scotland and the rest of the UK.
But higher interest rates are not the only pay off for the kingdom. UK Premier David Cameron must now make good on an as-yet unclear set of new fiscal powers to be devolved to Scotland, as well as to Wales and Northern Ireland. For a cash-strapped Westminster-based government desperate to win an election next May, this is a difficult situation to land in.
Drop it, like an unreliable colonist, and there will be hell to pay. In Quebec, Canada, the slow progress to reform after a referendum in 1980 led to rioting and a second referendum in 1995 which very nearly tore the region of Canada out of the Commonwealth.
Scotland will not allow nearby Westminster to forget. And as I have echoed before, it may not be a matter of allowing independence voting once in a generation. There are good grounds to holding it every ten years. A bit like renewing vows in a marriage.
It would appear that rattling London once every few years can have the benefit of winning concessions. If pledges are not kept Scotland will feel betrayed and a strong, if not decisive, 45% support for independence may return to pressure the UK in years ahead.
So Scotland may not become the first EU nation to split up (Belgium might yet make history at the centre of the European Union, while Czechoslovakia broke up in 1993, a decade before EU admission). Next up, the Catalans plan an independence vote in defiance of a less democratically-inclined Madrid. Game on.