Pages tagged with "Frequently Asked Questions"

Are smaller independent nations economically disadvantaged

Does the UK’s size help Scotland's economy? 

A key argument against independence is that the size of the UK domestic market is advantageous to the Scottish economy.  

Whereas that might provide some advantage to Scotland it is also worth noting that economic benefits flow in both directions. For example, the fact that Scottish oil revenues kept the UK afloat in the 1970s is something that no one in Government has ever denied.  Also, the fact that Scottish goods exports are 100% per head higher than the rest of the UK’s has helped the UK’s negative balance of trade from collapsing even further.  

Access to a larger market place as a stand-alone issue can be an advantage, but is that advantage outweighed by the disadvantages of not controlling economic, fiscal, and social policy, etc? 

The easiest way to consider this question is to benchmark Scotland’s economic position, as a part of the UK to that of independent northern European nations with the most similar population sizes.

Choosing small independent Northern European nations to compare against means that the economic conditions — regional, political/economic stability as well as proximity and access to the EU Single Market would be all very similar.

Identifying the four nations that fit the benchmark criteria and that possess the most similar population sizes to Scotland (two higher and two lower) gives us this selection:

Now let’s look at the size of each of those benchmark economies.  If being part of a larger economy were a net benefit to Scotland then we would expect to see Scotland’s economy to be larger than the other benchmarked nations.  However, this is clearly not the case. 

The evidence is striking, those other nations all have economies that are considerably larger than Scotland’s, which has a GDP of £179bn despite having a similar sized population at 5.4m.323  

Scotland is better positioned than all of those small nations across a broad range of prosperity factors. Scotland possesses massively higher natural wealth than all of the similar sized nations benchmarked against, with the possible exception of Norway.  So, if being part of a larger nation was an advantage then Scotland should outperform significantly all those smaller nations. Clearly the opposite is true - how come? 

Scotland’s GDP is £90bn smaller than the average of our near neighbours with similar population sizes and a massive £112bn smaller than Ireland, which has 600,000 fewer people. This clearly demonstrates that smaller independent nations perform better. 

Scotland has 8.4% of the UK’s population, however, Scotland also possesses 34% of the UK’s natural wealth. This means that Scotland’s economy should outperform significantly the rest of the UK’s on a per head basis. As a matter of fact, it does. Scotland’s GDP in 2018 works out at £32,800 per person, a whole £900 higher than the UK’s at £31,900.324 

So, Scotland’s economy outperforms the, larger, UK economy, but not the net economic position of smaller independent benchmarked nations; who also economically outperform the rest of the UK.  


Given its huge economic assets, it naturally follows that Scotland should be performing better than most, if not all, of those smaller nations we have benchmarked it against. The fact that it does not, therefore, points to a very important conclusion: that being part of the UK is holding Scotland’s economy back and limiting the shared prosperity of the nation. 

Ask yourself this question, other than possessing the full set of powers of an independent nation and the ability to tailor economic, business, social and environmental policies to the needs of their nations, rather than to those of a larger neighbouring country - what advantages do those nations of similar size to Scotland possess that Scotland does not? 

All data points to smaller developed countries that have full control of economic and policy levers having an economic advantage. As an independent nation, Scotland would have a smaller population than the UK, but it could have significantly larger prospects and more achievable ambitions.

Why leave one union (UK) to join another (EU)?

Several people have requested the answer to the question “why would Scotland leave one union, the UK, to join another, the EU?”

To make sense, this question relies on the premise that the two unions are similar in how they impact on national sovereignty when they clearly are not.  

A better way to look at the question is to ask what are the differences between the two unions in terms of how they affect the sovereignty of a member-state? We researched the facts and we found the following:  

The Truth about Scotland’s Sovereignty 

Scotland is currently not a sovereign state, as a part of the UK, but an independent Scotland would still be a sovereign country even if it were a member of the EU.

The Facts

  • Scotland is a nation within a union but in terms of statehood the union (UK) is recognised as the sovereign state. Scotland is not a sovereign state and will not be until it achieves independence from the union in a way that is internationally recognised.
  • The power that has been devolved to the Scottish Government is power delegated by the UK government which it can technically remove at any time. So, even though Scotland's Government may for arguments sake have parliamentary control over between 20-30% of the laws that effect Scotland, ‘power devolved is power retained’ and Scotland is not a sovereign state.
  • A basic definition of sovereignty, according to the Online Etymology Dictionary and the Oxford Living Dictionaries, is that it refers to superiority or supremacy usually in terms of the power to make political decisions within a territory.
  • International relations theory, distinguishes between internal and external sovereignty. In short, internal sovereignty is basically a state’s right to self-determination, and external sovereignty refers to the international recognition of a state that enables membership and access to international organisations and resources.1
  • Nowadays, it is widely accepted that state sovereignty is the primary constitutive principle of modern political life.2 This means that sovereignty is a prerequisite for joining international political unions and organisations such as the EU and United Nations (UN).  
  • Participations in political unions and organisations is what what provides a nation with a voice in the international political arena.3
  • Joining the EU is voluntary and so although membership requires the UK to accept and enact on EU laws and regulations that does not mean that the UK parliament’s supremacy over making laws has been reduced. This is because firstly the UK joined voluntarily, had a veto over new treaties and was able to leave when it deemed fit.  
  • By joining the EU, the UK participated actively in the EU’s decision-making processes, which would had otherwise been impossible.
  • The UK, much like Denmark, Poland and Ireland, had the opportunity to negotiate and opt-out from EU legislations such as using the Euro and adopting the Schengen agreement on full freedom of movement of peoples4.
  • The EU is also called a union but it does not require the sovereignty of its members to be transferred to the European Parliment.  Membership does require member states to align the laws that facilitate trade, quality and safety standards etc the elements of a function single market.
  • The UK did not exchange its sovereignty for its EU membership; the ability to hold the 2016 EU referendum through an Act of the Parliament of the United Kingdom (European Union Referendum Act 2015) is the best proof of that. The resulting difficulties of negotiating withdrawal deal and any future difficulties over negotiating trade deals in the 2020 transition period are not a result of a lack of UK sovereignty but rather the lack of the UK’s negotiating power due to the relative sizes of the EU with 27 member states and the UK on its own. 
  • To join the EU a state must be 100% sovereign and thus able both agree to align the required laws and also to leave the EU if it wishes to as the UK has proven.  


Brexit represents a clear cut example that the UK has remained a sovereign country throughout its period of EU membership. This would be the case for an independent Scotland or any other sovereign states joining the EU as equal members. Ironically Brexit demonstrates that Scotland is not at all sovereign, as its democratic wish to Remain in the EU is being ignored as a part of the UK. Regaining sovereignty therefor, either as a member of the EU or otherwise, is one of the strongest arguments for why Scotland should leave the United Kingdom.

On the other hand, the voluntary sharing of sovereignty, in terms of accepting EU legislation, is inevitable in the same way it is inevitable for everyone that decides to be a member of a democratic society to follow its laws and norms as well as to participate actively in their making. This is actually something that enhances rather than reduces sovereignty. 

In an interconnected world with interdependent economies facilitating trade and prosperity through aligning a small percentage of a nations laws with others is what makes a functioning single market possible. This in turn allows sovereign states to gain access to a larger pool of opportunities for development alongside other member-states without the loss of national sovereignty which is required to maintain membership of the UK.


  • James, A. (1984), `Sovereignty: Ground Rule or Gibberish?’ Review of International Studies 10(1), pp. 1-18, p. 2.
  • Walker R.B.J. (1990), ‘Security, Sovereignty, and the Challenge of World Politics,’ Alternatives: Global, Local, Political, Vol. 15, No. 1, pp: 3-27. 
  • Wallace W. (1999), ‘The Sharing of Sovereignty: The European Paradox,’ Political Studies XLVII, pp. 503-521, p. 503.
  • Briggs M. (2015), Europe ‘à la carteʼ: The whats and whys behind UK opt-outs, Euractiv:

Would an independent Scotland be in the EU?

It is probably not surprising that during Brexit week that the most frequently asked questions on the site relates to Scotland’s membership of the EU. Would Scotland be a member of the EU? Could it become a member of the EU? and would there be a referendum on joining the EU in an independent Scotland?

The first point to observe is that the UK will leave the EU on Friday, January 31st 2020. Therefore, when Scotland becomes independent it will not be a member of the EU. This is a significant change to the situation in 2014, when the UK was still a member of the EU and so was Scotland, by virtue of being part of the UK.

In the 2016 EU referendum, Scotland voted Remain by a margin of 62% to 38%. Since the Brexit vote, the political divergence between Scotland and the rest of the UK has widened significantly. This is demonstrated clearly by the fact that in the 2019 General Election, the SNP, who are avidly pro-EU, won 80% of the seats available in Scotland. Meanwhile, an avidly anti-EU Conservative majority formed in England, and therefore, in the UK as a whole. More recently, a poll for YouGov published on 28th January 2020 asked: “Was Britain Right/Wrong to vote to leave EU?”. When the ‘Don’t Knows’ are removed, 46% of UK voters thought that it was not a mistake, whereas 54% thought it was a mistake. Looking at regional subsamples, we can see that some areas, such as the South of England, Midlands and Wales, still marginally support Brexit. However, in Scotland, 73% thought Brexit was a mistake. Thus, Scotland is clearly the most EU supportive part of the UK.

So would an independent Scotland be a member of the EU?

That would be a decision for the people of an independent Scotland and the Government of Scotland. However, the significant number of people in Scotland that support EU membership would probably hold sway, and if there was a referendum on re-joining the EU, a sizeable mandate would be highly probable.

That said there is a simpler answer. The SNP, who currently run the Scottish Government, would be the political leaders in any independence referendum in the next few years and have a policy of Scotland being an independent nation within the EU. This is also backed by the other main pro-independence party the Scottish Green Party. This means that any vote to become independent would be predicated on a mandate to rejoin the EU.

Could Scotland rejoin the EU after Independence?

There is absolutely no technical reason why Scotland could not rejoin the EU. Some politicians say that Scotland would have to use the Euro. However, that is not the case, as we explained last week. Others say that Scotland’s deficit is too high. There are two clear misunderstandings at play here. First of all, there is no strict deficit requirement for being an EU member. The target of a 3% deficit refers to being part of the Euro Currency Zone, and that, therefore, does not apply.

The second misunderstanding is that no one actually knows what the deficit or surplus in an independent Scotland would be. We will answer the question "will an independent Scotland have a deficit?” in a future FAQ article.

In 2014, claims were made that Scotland couldn’t join the EU if it became independent and this was an important factor in the No Campaign win. Back then, the UK was a member of the EU and the EU could not make statements that interfered with the internal politics of member states. After the Brexit vote, many individual MEPs spoke out about an independent Scotland’s ability to rejoin the EU and as MEPs in the European Parliament voted to accept the Withdrawal Agreement, agreed with the UK Government, they held hands and poignantly sang the Scottish Song Auld Lang Syne (Burns).

A large group of MEPs, largely from the European Green Alliance, also gathered after the vote to say that they would leave a light on for Scotland to find it’s way back (something it can only do now after independence). Indeed, as far back as 2017, a group of 50 politicians from across Europe signed a letter stating that an independent Scotland would be “most welcome” as a full member of the European Union. Finally, the EU’s lead Brexit negotiator, Guy Verhofstadt, stated that he felt that “It's wrong that Scotland might be taken out of EU, when it voted to stay and that he was happy to discuss with the Scottish FM”.

Verhofstadt, the former Belgium Prime Minister, also said: “If Scotland decides to leave the UK, to be an independent state, and they decide to be part of the EU, I think there is no big obstacle to do that.” He added it would be “suicide” for the EU to refuse entry to people who are “sympathetic” to the EU’s aims.


After the UK leave the EU on January 31st 2020, Scotland will not be a member of the EU. Therefore, maintaining membership automatically (as was the wish of the Scottish Government in 2014) looks unlikely.

There is absolutely no reason why an independent Scotland would not be able to swiftly join the EU, as an independent nation. Scotland already meets all of the EU standards on food hygiene, safety, workers rights etc., and so, already meets all of the EU’s membership criteria. The claims that Scotland’s deficit would stop it joining, that there is a queue for membership, or that Scotland would have to join the Euro, are all manifestly untrue.

So, given the significant majority support for EU membership in Scotland, it is almost impossible to imagine that an independent Scotland would not apply and then gain EU membership very swiftly after leaving post-Brexit Britain.

Does independence put our pensions at risk? 

Many people ask and it's not unreasonable to do so, will their pensions be a risk in the case of independence for Scotland. We say that the question instead should be whether pensions are at risk now, whilst Scotland is still part of the UK? We researched the facts and we found the following:

The Truth

Pensioners are worse off in the UK than almost anywhere else in Europe. An independent Scotland can do better by respecting pensioners in a way the UK does not.

The Facts


The UK’s pension system is fundamentally unfair for older people and pensions are far from safe by staying in the UK. The UK state pension system is failing older people and is unsustainable for future generations. It is inadequate to help pensioners live a life free from worrying about financial security.

In addition to all the above, a motion was passed at the SNP Conference (2019) calling for a commission to look into increasing the State Pension in an Independent Scotland to the same level as the OECD average and supporting the commissioning of a Scottish State Pension Plan. We will provide a link to that plan here when it is published. 

Following the publication of our first Pensions FAQ (above) in January we received some more detailed questions on pensions and we are happy to answer them here. Firstly

Q 1) A major problem for me in 2014 was that I wasn’t sure if my existing pension could be put at risk by independence. The question which must be answered properly is - how will my existing UK state pension be guaranteed after independence?

Q 2) State pensions. I paid 40+years contribution to the DWP. After Independence who would pay our pensions, DWP or Scotland?

Q 3) Will an independent Scotland be able to pay the average EU pension (as % of the average wage) that the SNP has set as a goal?

We know that the question of pensions in an independent Scotland is an issue for many people, particularly those already in receipt of a state pension. It could be said that this issue played a decisive role in deciding the 2014 independence referendum, largely as the Better Together campaign regularly spread fear amongst older people about the potential risk from independence that just was not borne out by the facts of the matter. So, it is important to make sure people have the answers to their pensions questions this time, thus eliminating any room for doubt.

On page 20 of the report about pensions in an independent Scotland published by the Scottish Government in 2013 it states:

Everyone currently in receipt of the Basic State Pension, Graduated Retirement Benefit, State Earnings Related Pension Scheme or the State Second Pension would receive these pensions as now, on time and in full.

For those in Scotland in receipt of the UK State Pension at the time of independence, the responsibility for paying that pension would transfer to the Scottish Government.

For those people of working age, who are living and working in Scotland at the time of independence, the UK pension entitlement they have accrued prior to independence would become their Scottish State Pension entitlement.

There is also the statement by the then UK Minister of pensions, Steve Webb, who told ‘a Westminster committee those who had "accumulated rights" would be entitled to the money.’ In particular, in answering the question of pensions if Scotland had voted for independence, Mr Webb said:

"Yes, they have accumulated rights into the UK system, under the UK system's rules.”

He added that the money would be paid out at the pension age decided by the UK government, rather than any future Scottish government. He said: "Take a Scottish person who works all their life and then retires to France... they still have an accumulated pension right in respect of the National Insurance they have paid in when they were part of the United Kingdom.”

Asked whether citizenship would matter, Mr Webb told MPs: "Citizenship is irrelevant. It is what you have put into the UK National Insurance system prior to separation. Answer [for example] 35 years, that builds up to a continued UK pension under continuing UK rules. They are entitled to that money. The question is, who is paying for it, and how is that [cost] split?"

Meanwhile, there is also the case of the Department for Work and Pension (DWP) response to the same question, known also as the ‘DWP letter.’ According to the initial response to the question, a letter which is now notoriously difficult to find online, at least in good quality, ‘the UK state pension would continue to be paid to people living in an independent Scotland.’ In particular, according to an article about the issue on the BBC’s website, the letter, written in the name of a pension customer service advisor on 4th January 2013, stated:

"If Scotland does become independent, this will have no effect on your state pension - you will continue to receive it just as you do at present."

As the same article adds, ‘in a subsequent statement, a DWP spokesman said’:

"We will look into this specific letter in case any misleading information was inadvertently given out.

"However, what is absolutely clear is that it will be the responsibility of an independent Scottish government, not the UK government, to make arrangement for pensions for citizens of an independent Scotland.

"There can be no guarantee that it will be at the same level as it is now."

This response from the DWP clearly aims to create unnecessary ambiguity, which will be cleared up later in this post. However, this response by the DWP also raises the other important issue that needs clarification; the level of pensions in an independent Scotland. The state pension might not be at the same level as it is now - it could be higher.

The SNP conference in 2019 agreed that ‘as a minimum, an independent Scotland should plan to meet the OECD average for a Scottish State Pension as a top priority for all Scottish pensioner’s.’ This is to say, there is clearly a willingness by the SNP to increase the state pension to the OECD average. This would mean an increase of around £200.00 per week per pensioner. To be clear, the UK pension is currently the lowest in the EU, as referenced earlier in this article.

The Scottish Government have been unequivocal that people in Scotland will be entitled to a state pension if they meet the current minimum criteria for it. The minimum qualifying accruement for the new state pension is 10 years, although in order to get the full state pension 35 years of NICs are required. After independence, entitlement would continue to be built up in Scotland towards a Scottish state pension. This is similar to how state pension entitlement is transferred across EEA countries.

This would be paid for either by the UK government or by the Scottish government, subject to pre-independence negotiations. It is plausible that the Scottish government would inherit the full pension liability as part of the negotiation. This would however require payment from the UK government to the Scottish Treasury to release the UK Government from its obligations to pensioners, obligations that are cast iron. This would allow the Scottish government to make a guarantee that pensions would be protected and rates maintained.

Such an arrangement would be in the interests of both parties - it would allow the UK government to be freed of having to pay pensions across borders, saving bureaucracy, and the Scottish government to provide a 100% assurance that rates would be maintained or increased. This solution would be good for the people of Scotland who have already accrued a portion of a UK pension through NICs, as they would only eventually want to receive their pension from one government.

For now, the cost of providing a pension in Scotland is around 6-8% cheaper than in the rUK because of lower life expectancy. Furthermore, the Sustainable Growth Commission’s (SGC) figures suggest that the taxation raised in Scotland is sufficient to pay for all services currently devolved as well as cover the pension and social security arrangements paid in Scotland by the UK Government.

In addition, as we have already pointed out, Scotland is one of the world’s most naturally wealthy countries. The value of Scotland’s natural environment to the economy is huge and lays the foundation for Scotland’s continued prosperity as well as a sustainable economy that respects the planet and future generations. It would be fair to say that Scotland’s natural wealth, alongside the other advantages of the Scottish economy discussed in our website and publications, would make it possible to afford a state pension at the OECD average level.

The infrastructure to deliver pensions is already in place. The Pension Centres, which are currently part of the Department for Work and Pensions (DWP), will continue to administer and manage state pensions. These are based in Motherwell and Dundee. The SGC estimates that public sector employment in an independent Scotland would increase by 1%, with 100 extra staff being required in social security and pensions at a cost of £25m. However, they would also generate additional tax revenues of £1.5m, as well as immeasurable benefits from increased personal spending.

To be clear, the cost of pensions to an independent Scottish Government would be the same or lower than they are right now unless the Scottish Government decided to increase the amount to a higher level than they are as part of the UK. There are no significant additional pensions costs to the Scottish Government associated with independence.

An indication of how a state pension system would operate across borders after Scottish independence can be seen in current pensions practices. It is a fact that state pension entitlement is based upon accruing sufficient NICs over a person’s working life. This is built up regardless of the nationality of the person working, or the country of residence. In 2012, the UK government paid state pension to 1.2m people living outside the UK.

This would happen in an independent Scotland. According to the National Institute for Economic Review, cross-border state pension liabilities would be relatively small if Scotland decides to become independent.

When it comes to raising state pensions to the OECD-average level, it is certainly encouraging that the SNP, as the pro-independence party and the one currently in government in Scotland, is making plans to make this happen. This though may not happen instantaneously. It would be logical to forecast that pensions in an independent Scotland would gradually reach the OECD-average level over time.

To summarise, the UK government has a legal obligation to pay pensions to all those who have paid into the system via their National Insurance Contributions during their working life. The UK government would therefore continue to pay pensions as normal, whether pensioners lived in an independent Scotland, France, Spain, or in any other country. To get out of that obligation, the UK government could choose to make a capital payment to the Scottish Government as part of the independence negotiations. In that case the Scottish Government would take on the responsibility to pay UK pensions to pensioners living in Scotland.

If you have any more questions about pensions in an independent Scotland please submit them on the FAQ for to the right of this blog.

Would an independent Scotland have to use the Euro?

It's a regular question and relates to EU rules that are largely misunderstood, whether an independent Scotland would have to necessarily use the Euro as its currency. We say that the question is more about whether an independent Scotland would decide to adopt the Euro or not? We researched the facts and we found the following:

The Truth

The short answer is, ‘no Scotland would not have to necessarily use the Euro.’ In fact, if an independent Scotland decides to join the EU as a full member, then according to the process for joining as a new member, Scotland would have to commit to using the euro at some undefined point in the future.

The Facts

  • The Scottish Government’s current policy is to be an EU member.
  • It is technically impossible to join the euro if you do not have your own currency. Joining the euro involves joining the European Exchange Rate Mechanism and without a sovereign currency, you can’t do that.
  • In principle, all Member States that do not have an opt-out clause (i.e. the United Kingdom and Denmark) have committed to adopting the euro once they fulfil the necessary conditions. However, it is up to individual countries to calibrate their path towards the euro and no timetable is prescribed.
  • The Member States that joined the EU in 2004, 2007 and 2013, after the euro was launched, did not meet the conditions for entry to the euro area at the time of their accession. Therefore, their Treaties of Accession allow them time to make the necessary adjustments.
  • It is highly likely that an independent Scotland would continue to use the sterling as its currency, at least during a transitional period.
  • To use the euro you have to meet the necessary conditions set by the EU and Scotland doesn’t, not least because it neither has nor plans to launch its own sovereign currency immediately after becoming independent.
  • Scotland would be empowered by the EU to decide the timetable to meet the conditions and as quoted, no timetable is prescribed; Scotland could be on an indefinite path to adoption. There are several nations to whom this process already applies and the EU told them they did not qualify to use the euro; such as Bulgaria, Croatia, Czechia, Hungary, Poland, and Romania.


An independent Scotland does not need to use the euro as its currency under all circumstances.

  1. Due to the use of sterling in the transition period, it is possible for Scotland to join the European Free Trade Association (EFTA), which includes Norway, Iceland, Switzerland and Liechtenstein, to have to access the single market and customs union. EFTA members are not required to join the euro, but they can if they wish to become full members of the EU.
  2. If independent Scotland joins the EU as a full member state the EU will agree that it is not possible for Scotland to adopt the euro and will give the Scottish Government full control over the timescales to meet the criteria. The Scottish Government can therefore indefinitely avoid joining the euro. However, a future Scottish Government might decide to join the euro voluntarily.