Gordon Brown storms in with a “third option” for Scotland and the UK. The ideal compromise, or too much, too late?

Churn over Theresa May’s flat refusal to allow Indy ref 2 continues unabated. The reality of identity politics is proving a lot more complicated than the dream. The big move today is Gordon Brown’s “third option” of a federalising UK  of which more in a moment. But first a verdict on yesterday. May was caught short by Sturgeon springing the referendum demand on her. Did  the prime minister  over-react in haste and did she have only herself to blame for the SNP raising the stakes and the  temperature? – a key question in Mure Dickie’s lengthy piece in  the weekend FT (£)

The May administration has offered no substantial public response to a 50-page Scottish government paper proposing special post-Brexit arrangements — including continued membership of the EU single market. Calls for devolution of immigration powers have been waved aside. Mrs May has even signalled willingness to unilaterally redraw Scotland’s devolution settlement to ensure powers exercised by the EU go to Westminster, not Edinburgh. “She started well with her overtures to the first minister and making Edinburgh her first visit . . . but that may have raised expectations she has not been able to follow through on,” says  Edinburgh political professor Nicola McEwen.

In an interview Smart Alex Salmond leaps in with a super-confident analysis of the indyref2’s’chances which he believes checkmates all the objections to Scottish independence
On the Brexit vote

 “I said to Cameron three things — one, that he should introduce in the Referendum Bill that all four nations should have to agree if it was Brexit; two, that 16 and 17-year-olds should vote . . . and thirdly, that European citizens should vote. He refused all of them. If he’d accepted any two out of three, there’d have been a Remain vote and he’d still be prime minister.”

The question of continuity that matters is continuity within the single marketplace, the European Economic Area. Don’t underestimate the reservoir of goodwill that Scotland has now.

Asked how this would disrupt trade between England and Scotland, he pointed out that Mrs May has already promised no hard border between Northern Ireland and Ireland. “It’s totally impossible to argue you can have a frictionless border on the Foyle but you can’t have one on the Tweed.”

On the May government’s handling of Northern Ireland

(He) blamed the prime minister for events in Northern Ireland, where unionists have lost their majority in the Stormont assembly. “Unlike Cameron, and Blair — God help me — and Major in particular, who all put a heavy shift into Northern Ireland, she’s allowed a Northern Irish impasse to develop. An active prime minister with an active Northern Irish secretary could have avoided this. And one of the things you might have thought of to avoid it would have been to say ah, this single market thing’s quite interesting.”

In the last referendum, unionists portrayed independence as a risky scenario that could jeopardise pensions and public services.

On the crucial currency question

Mr Salmond said he was open to changing his 2014 view that the best option was a currency union between Scotland and the remainder of the UK. “You can’t do something which the other side could have a veto over,”

On agreeing trade terms with the UK

“I’m sure that these £40bn of English exports [to Scotland a year] will concentrate the mind of whoever’s prime minister after Theresa May. I fancy that guy David Davis

Remembered for his intervention in  Indyref 2014’s late scare that the SNP  were winning the campaign,  Gordon Brown has again intervened  on the last day of the SNP conference with a repeat of his plan for a federal UK and more powers for Holyrood. As I pointed out yesterday the latter could be fruitful territory for cooling the  temperature  between May and Sturgeon. One of  the first minister’s  grievances is her claim that Westminster is going for a power grab for control over agriculture and  the environment currently residing  in Brussels  that should properly be devolved. Westminster argues they need  some powers to be able to negotiate new agreements in these areas with other countries.

In the Daily Record last year, the Better Together advocate and former senior civil servant Jim Gallagher  enumerated the economic case against independence post-Brexit  in the Daily Record.

  Nearly a third of Scotland’s economy is trade with England, but there could suddenly be Customs posts on that Border.

There would no question of keeping the UK pound with Scotland in the EU and Britain out, and the new Scottish pound would hit jobs by making trade harder.

On top of all that, Scotland couldn’t share resources with the rest of Britain. Given our £15billion deficit, to get to a remotely acceptable fiscal position we’d need cuts that would make George Osborne look like a soft-hearted Santa Claus.

This is all obvious – but Brexit means radical change for Scotland’s position in the UK as well. When EU rules no longer apply, opportunities open up for Scotland to make its own choices on agriculture, fisheries and economic development.

This is the hook to attract  Scotland in Gordon Brown’s “ third option” proposals today,  set out  in the same paper ahead of a major speech

The third option gives us a basis for uniting a still divided country. It consists of:

• Repatriation of powers from Europe to the Scottish Parliament rather than to Westminster, so – as advocated by Scottish Labour leader Kezia Dugdale – decisions in the key areas of agriculture, fisheries, environmental regulation and employment will be made here in Scotland.

The right of the Scottish Parliament to determine their own regional economic policy and take action in support of our own industries.

• The right of the Scottish Parliament to decide the rate of VAT – or even a replacement sales tax – for where currently revenues are assigned.
• The right of the Scottish Parliament to independently negotiate treaties with European and other countries on matters within its powers.
• Scottish industry and Scottish universities to have support to access European Union programmes like Horizon for ground-breaking research and Erasmus for students.
• Guarantees that Scotland cannot be taken out of the European Convention on Human Rights or the EU social chapter without the consent of the Scottish people.
• A new UK-wide council of the nations and regions so they all have a say in future trade negotiations.(a reformed House of Lords).
• On the pound, pensions, basic welfare rights and defence and security, Scotland to retain the benefits that come from being within the UK – with the Bank of England renamed the Bank of England, Scotland, Wales and Northern Ireland and fully staffed up to support Scotland’s economy.

Some call the new federal-style settlement for the Union “Federal Home Rule”.

Let me send a message today – and I will fight, fight and fight without end for this in the weeks and months ahead – that from now on, the debate on the future of Scotland will no longer be limited to two options.

The patriotic Scottish way would give Scotland the benefits of being in Britain while seeking and securing the closest possible ties with Europe.

We don’t need to be imprisoned by one form of extremism – the Tories who would grab power from Brussels and make the UK an even more centralised state – and another form of extremism – a more hardline SNP who would take us out of the British single market, putting at risk many of the one million jobs linked to it.

As ever Brown makes  a powerful appeal but it is open to two basic objections.

When he raised it before it fell like a lead balloon in Scotland –  it lacks the simple appeal of independence and has a whiff of appeasement about  it.

It’s vulnerable to the charge of the tail wagging the dog. There’s little appetite for major constitutional change in England. Indeed a new poll in England suggests Brexit enjoys more support than saving the Union.

Brown will argue that when tempers cool, economic reality will dawn and the attractions of his third option will hove into view.

Brian Walker

Former BBC journalist and manager in Belfast, Manchester and London, Editor Spolight; Political Editor BBC NI; Current Affairs Commissioning editor BBC Radio 4; Editor Political and Parliamentary Programmes, BBC Westminster; former London Editor Belfast Telegraph. Hon Senior Research Fellow, The Constitution Unit, Univ Coll. London