Aberdeen “worst hit” by hard Brexit, experts predict

BBC, today:

Aberdeen could be the city worst hit by falling economic output due to a “hard” Brexit, experts have predicted.

A new report from the Centre for Cities and the Centre for Economic Performance at the London School of Economics said all cities would see a fall in output due to increasing trade costs.

Aberdeen and Edinburgh were both ranked among the ten most affected cities.

However, the study said both cities are also among the best-placed to respond to any predicted economic turbulence.

The full report can be read here.

Most and least affected cities (% change in Gross Value Added)
Most affected cities (% change in Gross Value Added). Source: Centre for Economic Performance analysis, 2017. From report Brexit, trade and the economic impacts on UK cities (figure 3, page 5)

 

House of Lords urges differentiated solution for Scotland in Brexit

From “Chapter 5: Scotland” of the UK parliament’s House of Lords European Union Committee report on Brexit and devolution, published today:

We conclude, on the basis of the weight of evidence submitted to this inquiry, that the Scottish Government’s further proposal, for continued Scottish membership of the Single Market, through the European Economic Area, while the rest of the UK leaves the Single Market, is politically impracticable, legally highly complex and economically potentially disruptive to the functioning of the UK single market.

Nevertheless, we urge the Government to respect the particular circumstances in Scotland. While we acknowledge that the referendum was a UK-wide vote, giving a UK-wide result, the Government needs to recognise the fact that the vote to remain in Scotland, at 62%, was the largest and most decisive (either in favour of remaining or leaving) in any nation of the UK.

We therefore consider that, in the event that the UK Government does not secure a UK-wide agreement that adequately reflects Scotland’s specific needs, there is a strong political and economic case for making differentiated arrangements for Scotland.

The Scottish economy has particularly pressing needs, including its reliance on access to EU labour, which is acute in sectors such as health and social care, agriculture, food and drink, and hospitality. We also note Scotland’s demographic needs, and its reliance upon EU migration to enable its population (and in particular, that of working age) to grow. Scotland’s more sparsely populated regions are disproportionately reliant both on EU migration and EU funding. Many of our witnesses argued that the most pressing case, in view of Scotland’s economic and demographic circumstances, would be for a standalone approach to immigration policy. We address this issue in the next chapter.

Our witnesses have also suggested that differentiated arrangements could be reached in fields such as energy policy, justice and home affairs cooperation, participation in Europol, access to EU structural or research funds, participation in such programmes as Horizon 2020 or Erasmus, reciprocal healthcare provision, workers’ rights and working hours, and agriculture and fisheries.

Finally, we reiterate that maintenance of the integrity and efficient operation of the UK single market must be an over-arching objective for the whole United Kingdom. But that objective does not preclude differentiated arrangements for Scotland in some areas, and nor does it justify excluding the Scottish Government from the Brexit process. […]

The JMC on EU negotiations: what a total farce

According to the UK government’s Secretary of State for Scotland David Mundell “[t]he Joint Ministerial Committee (EU Negotiations) was established to facilitate engagement between the UK Government and devolved Administrations” in “seeking the best deal for all parts of the UK” in EU negotiations.

John MacDonald, writing in issue one of Cable magazine:

The JMCs seems designed to leave representatives of the devolved nations under no illusions as to who is in charge. JMC meetings have only once been held outside of London. A single meeting was held in Wales. On that occasion, the Welsh government was not permitted to organise the event — it seems that only the UK government has the capacity to undertake that Herculean task.

JMC meetings are always chaired by a UK Minister and are always heavily populated by UK government officials, something which does much to colour the dynamic of meetings. Meetings are scheduled for just one hour. This is surely a ludicrously short time to allocate to a ‘monthly’ meeting on an issue as serious as how we leave the European Union.

Scottish representatives report typically having only around ten to fifteen minutes to articulate Edinburgh’s position during these meetings. They also express concerns over how receptive UK government officials are to discussing areas where there appears to be a divergence of view between Edinburgh and London. Indeed, Scotland’s Brexit Minister Mike Russell is on record as saying that such divergences are not necessarily acknowledged by London; key substantive issues which have been raised during the JMCs have been ‘simply taken away after discussion for UK officials to consider, and they have never re-emerged.’

Mike Russell responded on Twitter: “Correct — but we still need to find a way forward[.]”

(Source for David Mundell quote here.)

Theresa May ditches manifesto pledges to clear decks for Brexit: Legislative battle ahead to clear hung Commons and Scottish Parliament

FT.com, today, in an article on the UK government’s legislative agenda announced in the Queen’s Speech:

There were growing fears in Whitehall that the Scottish nationalists could hold London to ransom by voting down the Great Repeal Bill—which puts EU law into British law.

Britain’s devolution settlement was developed under the auspices of the EU single market.

The government now believes that the relevant framework should be reset at a UK level, in particular for devolved policy areas such as agriculture, fisheries and environmental protection.

But that requires the authorisation of all the devolved administrations in Cardiff, Edinburgh and Belfast through “legislative consent motions”.

A Conservative official said that there was likely to be sabre-rattling by the SNP during the process, which could take eight weeks, but said there were hopes that Holyrood would not stand in the way. “It’s common sense. There would be major consequences for Scotland if this wasn’t passed, there would be holes in the law,” he said.

The Guardian’s Andrew Sparrow, earlier this evening:

This is a consequence of what is known as the Sewel convention, which says the Westminster parliament should not legislate on matters devolved to Scotland without the Scottish parliament’s approval.

As we learned earlier in the year, the Sewel convention is just that—a convention—and is not (as far as I believe) enforceable by the courts1. The UK Government, however, has thus far not (as far as I’m aware) overridden a vote in the Scottish Parliament. It seems that it could legally do so but in such a scenario we would be in uncharted constitutional waters.

Update: The Guardian has published an article looking in more detail at this issue. The piece includes quotes from Mike Russell, the Scottish Government’s Brexit minister, and Graham Matthews, president of the Law Society of Scotland.

Revealed: The plan to keep EU workers in Scotland

From this morning’s Herald:

Detailed plans have been drawn up for Scotland to set lower barriers than the rest of the UK for low-skilled immigrants after Brexit.

Experts at the University of Edinburgh believe they have devised with a “politically viable” way of sustaining the net inflows of EU workers currently propping up key industries such as tourism, hospitality and food processing.

The landmark report has been welcomed by the Scottish Government who described the current UK-wide approach to immigration as “damaging to Scotland’s economy”.

Business leaders fear the end to freedom of movement and hardline cuts to UK-wide immigration targets following Brexit will spark crippling labour shortages in Scotland.

You can read the paper—‘Scottish Immigration Policy After Brexit: Evaluating Options for a Differentiated Approach’—at the University of Edinburgh website. It looks at the merits of four main schemes1:

  • Human capital points-based systems, drawing on examples from Queensland (Australia) and Quebec (Canada)
  • Post-study work schemes, informed by the examples from Scotland and British Columbia (Canada)
  • Employer-led schemes, with examples from the Alberta (Canada), Switzerland, and the EU Blue Card
  • Occupational shortage lists, drawing on examples from the UK, Canterbury (New Zealand) and Spain

Roundup, Wednesday 10 May 2017

4 May local election results

Party Seats +/- Votes Vote % % +/-
SNP 431 6 607,747 32.3 0.0
Conservative 276 161 477,124 25.4 +12.1
Labour 262 -132 376,799 20.0 -11.4
Lib Dem 67 -4 130,018 6.9 +0.3
Green 19 5 75,669 4.0 +1.7
UKIP 0 0 2,869 0.2 -0.1
Independents/other 173 -31 209,131 11.1 -2.6

Source: Britain Elects

Former ECJ Advocate General: Post-Brexit, Scotland could be in both the UK and EU

Miguel Maduro
Miguel Maduro at The State of the Union 2013, European University Institute. License: CC BY-SA 2.0.

Professor Miguel Poiares Maduro, former Advocate General at the European Court of Justice, giving evidence today to the Committee on Constitutional Affairs (AFCO) in the European Parliament:

“There is one other possibility, that is to have that some UK citizens may maintain citizenship of the European Union and others won’t. And this is a bit of a provocation… It is… Nothing prevents a part of the United Kingdom to stay and another part of the United Kingdom to leave. We have a precedent with that; it’s called Greenland. We have the case of one member state where part of its territory left the European Union and another part stayed. So, in principle, nothing will prevent for the territories, for example, of Northern Ireland and Scotland to stay in the European Union, and for the rest of the territory of the United Kingdom no longer to be part of the European Union.

“Of course, this will be complex to organise in practice, it will require a border inside a member state, because it will basically mean that Scotland and [Northern] Ireland will remain part of the European Union and part of the United Kingdom. But it will not be impossible.

“Still, it will be again very problematic in political terms, and the consequences of it will make it difficult. If we think about it… I think, on the one hand one risk will be economic—for the UK—because naturally you will have… I will say for Scotland and Northern Ireland, it would be extremely positive. They will attract lots of investment and companies that will locate in those territories because they could benefit from both those markets. But of course for the rest of the United Kingdom it will be even more dramatic because there will be economic mobility to that part of its territory.

“For the European Union, the difficultly will be that if this will take place without the UK formally leaving as a state—because part of its territory will stay, in the same way that happened with Denmark and Greenland—it will mean that the representation of that part of the territory would be made by the UK government; not by the Scottish and the Northern Ireland governments. For this to be done, without leaving and then coming in as Scotland and Northern Ireland to be then in terms of state secession, the representation of this part of the territory will have to continue to be done by the United Kingdom central government.

“Of course, there will be the possibility to leave as [the] UK and come in as part of the UK. That will be another alternative.”

The Scottish Government made proposals along these lines in the paper Scotland’s Place in Europe, published late last year. David Davis, the UK Government’s Brexit secretary, rejected the proposals.

Hard Brexit would cost us £500m a year, says oil and gas industry

The Guardian, today:

Brexit would land the oil and gas industry with a half-billion-pound bill if EU exit talks end with the UK leaving on World Trade Organisation rules, Theresa May has been warned.

The costs for trading £73bn worth of oil and gas annually would jump from £600m a year now to £1.1bn in a worst case WTO scenario, analysis [by EY] for the industry trade body found.

At best, if the UK could strike more favourable tariffs with non-EU countries, the cost of trade might fall to £500m, Oil and Gas UK said.

The trade body also argued that post-Brexit freedom of movement should not be curtailed in a way that would put the industry at a “competitive disadvantage” with other countries. About 10% of the UK oil and gas sector is from outside the country, slightly above the national average.

Roundup, Wednesday 3 May 2017

Roundup, Wednesday 19 April 2017