Christopher Howarth: Two Unions, two borders, two islands – why the future of the EU and UK places the British Isles at a decision point

Christopher Howarth is a senior Political Analyst at the think tank Open Europe. Prior to Open Europe he worked as a Conservative Foreign Affairs Adviser and senior researcher to a Shadow Europe Minister. Follow Open Europe on Twitter.

The last 40 years of British Isles political history could be characterised as the history of two Unions: The Union of Great Britain and Northern Ireland, and the European Union straddling both the Republic of Ireland and the UK. As a result of these two unions we have unhindered cross border traffic between England and Scotland, and across the island of Ireland. We take this for granted, but should we? The referendum on Scottish independence, set for 2014, and a potential Conservative referendum on UK membership of the EU shake these assumptions and pose interesting questions for the SNP, Ireland and unionists. These three groups have always seen the two unions rather differently.

Firstly, the Republic of Ireland. When the UK joined what became the EU the Republic of Ireland followed suit. From an Irish viewpoint the EU was a tempting prospect; generous subsidies and the promise of an environment where small states could gain real independence from, and equality with, their larger neighbours. The decision to join the Euro again seemed clear-cut. The Irish Punt dominated by Sterling could be exchanged for a currency over which Ireland would be a shareholder. With Tony Blair promising to fix UK entry into the Euro all seemed settled: they would have a currency shared with their trade partners in both continental and UK Europe. However, Tony Blair did not take the UK into the euro and the eurocrisis has unpicked the logic that euro entry would lead to more ‘independence’. Ireland’s economy – subject to an EU bailout – is now overseen by a Troika and ultimately the Bundestag.

Secondly, the SNP. They have, in the past, followed Ireland’s logic arguing that EU membership makes Scotland’s independence a plausible and practical proposition. If the UK had joined the euro, an independent Scotland could have shared a currency as well as a passport and customs-free border with England. Now it is virtually certain the UK will not join the Euro, Scotland’s nationalists are in a twist – sharing a common currency (be it Sterling or the Euro) over which you have little or no influence does not guarantee ‘independence’ as Ireland has found out. But they have other problems. What terms would an independent Scotland gain in its EU accession negotiations? Could it gain a euro opt out and could it preserve its passport-free travel with the UK by remaining outside the Schengen free travel area? Could Scotland benefit from David Cameron’s attempts at EU reform? Could it even avoid a Spanish veto and be in the EU at all? And in the longer term will the UK actually be in the EU? These questions all cast doubt over the SNP’s plans for independence.

Thirdly, unionists in Scotland and the remainder of the UK. At some point there could be a UK referendum on EU membership and therefore a possibility, at least, that the UK could decide to leave the EU. The focus now is on what deal can be negotiated prior to a referendum but some British Isles issues should also be raised. Firstly, would a non-EU UK be able to keep the Northern Irish border passport and customs-free? Ireland and the UK have their own common travel area (a mini-Schengen), meaning both states need a Schengen opt out. This could conceivably continue if the UK was out of the EU and Ireland in, (although as former Irish PM John Bruton has pointed out it would make the policing of the onwards travel of EU jobseekers exercising their right to move to Ireland complicated), but keeping the Northern Irish border customs-free would however be impossible due to the external EU tariff wall.

But perhaps the Republic of Ireland would also chose to leave the EU if the UK left. This seems unlikely, not least because it is in the euro and subject to a bailout programme. However, for Ireland both UK EU withdrawal and/or Scottish Independence would still be a disaster. The UK being outside the EU would make their trade with their largest trading partner more complicated – with a new customs border – and Scottish independence would (like UK withdrawal) also have the potential to destabilise Northern Ireland.

Another combination could be an independent Scotland leaving the EU, followed by the UK. In this situation, if both states were outside the EU, they could agree their own UK/Scotland customs union and (if Ireland agreed) allow Scotland to join the Common Travel area thus preserving the passport-free travel area. There is a subsidiary question as to what would happen to Northern Ireland if Scotland left the UK – would Northern Ireland stick with the UK or seek independence or even join Scotland? This seems unclear but whatever the answer this could lead to unwanted instability.

So how do these considerations this fit with Conservative policy?

Conservative Policy on the UK is clear – to persuade Scottish voters to stay. This is the right policy and persuasion is far preferable to say Spain’s less gentle approach towards Catalonia. As preserving the UK is undoubtedly more important than preserving the EU some may ask whether, in the long term, Scottish independence would be more or less likely if the UK left the EU. Although a non-EU UK would make Scottish independence more complicated and less plausible, it is best to win the case for the Union on its merits (the referendum on the EU will in any event come after the Scottish 2014 referendum). The priority should be on making the 2014 vote a final vote. If Scottish independence is not closed down as an issue an EU referendum could even have the potential to complicate things – say, if Scotland votes to stay in the EU and England votes to leave. The Government seems to be doing this, but at times can fall in Salmond’s trap by allowing for a continuation of a discussion on independence and weakening the Union via further devolution even after a No vote (The SNP will say Scotland only voted to stay in the UK on David Cameron’s vague promise of more power).

The Conservative policy of renegotiating a better EU deal, which could allow the UK to stay in the EU on terms the people are happy with, also has its plus-points for those wishing to preserve the UK. What for instance would the SNP say to Scottish small businesses and taxpayers when explaining that leaving the UK would mean – not just a chance of leaving the EU – but, at the very least, leaving behind not only the benefits of the UK’s existing EU budget rebate and EU justice opt-outs, but also a potential new UK deal in areas such as social policy, fisheries and financial services? If the UK negotiates for itself a better EU deal an independent Scotland would not get the benefit of it.