Scotland

Having returned from Scotland over the weekend, may we suggest that if it wants to maintain its reputation as "a clean, unspoilt destination with beautiful scenery", which generates at least £4bn per year in tourist spending, it stops desecrating all that lovely scenery with wind turbines.

We have never seen so many turbines - the presence of so many completely destroys any natural beauty the Scottish countryside has.

However on the brighter note we took the opportunity to visit parts of Scotland we hadn't got around to seeing previously. We had a little day trip to Dundee, despite the rain, and found our way to Tannadice Street home of both Dundee FC...

  

 ...and Dundee Utd FC.

They're so close together on the same street it's ridiculous (Dundee is on the right, Dundee Utd is just down the road on the left). 

 

And then we visited the Falkirk Wheel, which is an amazing piece of engineering - the 21st century upgrade of the Anderton boat lift in Cheshire:

And with engineering in mind, we note that passing across the Forth Road Bridge progress is being made on its replacement which is due to be finished next year. The reason for the replacement, despite being built in the 1960s, is the old road bridge is falling to pieces. What a contrast to the Victorian rail bridge, opened in 1890 which...er...is still there and needs no replacement. And is the bridge where the SNP are proud to stand outside.

Parish Notice

I will be spending the rest of the week in Scotland for a personal visit, so the opportunity for blog posts may be rather limited although I am taking my laptop with me.

Blogging will resume on my return with a piece on the BBC, an EU Referendum and Ofcom. Meanwhile above is a picture of Ravenscraig Castle in Kirkcaldy, which is near where I will be staying.

Why A 2015 EU Referendum Cannot Happen (Update).

Following on from our previous post regarding the impossibility of a 2015 referendum, we contacted the Electoral Commission to try to clarify a number of further potential technical issues.

While, like most quangos, the Electoral Commission displayed a deep reluctance to commit themselves to answering certain questions posed, their first response confirmed our initial points that, contrary to Farage's assertion, a referendum cannot happen in a few weeks (quoted from the Electoral Commission's email):

Currently, we cannot say how the designation process will work at any future referendum until Parliament passes the legislation setting out the rules for that referendum. 

Our role is to regulate the referendum and designate campaigners under the rules for each referendum. The rules that applied at previous referendums required the Commission to designate campaigners that sufficiently represented those campaigning for the outcome they support, or, if more than one, represented those campaigning to the greatest extent.

This reiterates precisely our point that it means campaigning groups can't begin to officially campaign until they submit bids for the official "in" and "out" campaign and have been approved. With Scotland a campaign period of 16 weeks was the recommendation.

However the approval process is likely to take six months as also recommended by the Electoral Commission. This six month process cannot happen until after the referendum bill becomes law which in itself at best will take months.

Thus with the Electoral Commission's recommendations which considered the experience with Scotland (for recommendations, read demands) it becomes clear that a 2015 referendum is simply out of the question.

Why A 2015 EU Referendum Cannot Happen.

As noted in the Independent last Sunday, Nigel Farage has indicated that he will support a minority Conservative Government if Prime Minster David Cameron promises a referendum in 2015:

"The terms of my deal with the Tories would be very precise and simple. I want a full and fair referendum to be held in 2015 to allow Britons to vote on being in or out of the European Union. There would be no wiggle room for 'renegotiation' somewhere down the line'.

"The EU is facing an existential crisis and, given that it only takes a few weeks to launch and organise a referendum, it should be held in 2015.”

Although we would largely agree with the sentiments of a "full and fair" referendum, we would take issue with the "very precise and simple" demand that a referendum should be held in 2015 and "given that it only takes a few weeks to launch." For the very precise and simple reason that it can't be done. Farage is offering impossible terms on the practicality of timescale.

To support Farage's demands comparisons are sometimes made with the 1975 referendum where it is claimed that it is possible to have a referendum in a few weeks, the timeline often quoted is as follows:

December 1974: Harold Wilson requests renegotiation of EEC membership terms.

European Council agreed to new terms for UK in Dublin by 11 March 1975 and renegotiation largely ended.

26 February 1975: White Paper announcing referendum to be held after result of renegotiation was known

26 March 1975: Referendum Bill published.

31 March 1975: White Paper setting out the results of the renegotiation of the UK membership of the EC.

9 April 1975: after a three-day debate on the Government’s recommendation to continue Britain’s EC membership, the Commons voted 396 to 170 to continue in Common Market on the new terms. At the same time Government drafts Referendum Bill, to be moved in case of a successful renegotiation.

On 22 April 1975 the House of Lords approved continued membership by 261 votes to 20.

Post-legislative referendum held 5 June 1975. Referendum not directly related to White Paper on renegotiation, but preamble referred to renegotiation. Question much broader: “Do you think the UK should stay in the European Community (Common Market)?” The result was 67 per cent in favour on a 65 per cent turnout.

As we can see in 1975 the passage through Parliament to holding a referendum took circa 10 weeks (26 March - 5 June) from publishing the Bill to holding the Referendum. The 1975 Referendum book though notes (p.66):

"But the real reason for the unexpectedly easy passage of the Bill was political: pro-Marketeers were in an overwhelming majority in the House of Commons and they had belatedly realised that the referendum would go their way."

Even with an easy passage it still took two and half months to have a referendum. The election in 2015 is in May, then there's a summer recess so we can expect it to take longer. Especially when we consider that due to the complexity of an EU that has significantly evolved in over 40 years of UK membership and the less certainty of a referendum result, that its passage through Parliament will be more turbulent and difficult.
 
We have noted before regarding trying to win a referendum, 1975 is not 2015. The country has moved on in forty years. Procedures are now different, for example in 1975 the campaign started in January 1975 long before the Referendum Bill had been passed - with self-appointed "umbrella" groups.

However unlike 1975 referendums are now the responsibility of the Electoral Commission, which was established under Political Parties, Elections and Referendums Act 2000. Thus on that alone the timescale in comparison to 1975 has changed.

With the establishment of the Electoral Commission it means that campaigning groups can't begin to officially campaign until they submit bids for the official "in" and "out" campaign and have been approved. This process cannot happen until after the referendum bill becomes law.

There has to be a reasonable period to allow the Electoral Commission to invite submissions and make the designation, and then the lead organisations must be given time to organise themselves.

As we can see from the Electoral Commission December 2014 report on the Scottish Independence Referendum held on 18 September 2014, it recommends (my emphasis):

... that in planning for any future referendums, not only in Scotland but also those held across or in other parts of the UK, governments should aim to ensure that legislation (including any secondary legislation) is clear at least six months before it is required to be implemented or complied with by campaigners, the Chief Counting Officer, Counting Officers or Electoral Registration Officers.

Thus "a reasonable period" according the Electoral Commission amounts to six months, as it argues to allow for (again my emphasis):

The benefit of this additional time was passed on to campaigners, EROs and COs in preparing for their respective roles at the referendum:

Campaigners were able to engage constructively with the legislative process and had time to develop an understanding of the relevant guidance and rules, before they came into force. EROs and COs benefitted from sufficient time to put robust plans in place for the delivery of their responsibilities under the legislation, from targeted public awareness activity to the booking of polling places and the training of staff.

In addition the Electoral Commission also recommends (again my emphasis):

2.39 Following the 2011 referendum on additional powers for the National Assembly for Wales and the Parliamentary Voting System for the House of Commons, we recommended that for future referendums the detailed rules should be clear at least 28 weeks in advance of polling day, based on a statutory regulated referendum campaign period of 16 weeks.

Although the Electoral Commission cannot demand, where it recommends will be taken into account should there be a challenge to the Bill and it goes to a Judicial Review as undoubtedly it would should there be any form of corner cutting or fast-tracking.

Yet even with a relatively smooth process by the Electoral Commission's recommendations there would be a ten month delay between an Act of Parliament and a vote: that obviously takes us well into 2016.

In addition Farage thinks he can determine the referendum question:

 "Do you wish to be a free, independent sovereign democracy?"

Despite the fact that the Electoral Commission has already put forward its proposals for the referendum question - its full report is here, Farage's suggestion wouldn't even pass the unambiguity test let alone the neutral one.

At this point I don't know what to conclude. Either Farage is very poorly briefed which is a reflection on a lack of a decent research department despite having (now) 22 very well paid MEPs or he knows this and is deliberately demanding conditions that Cameron (or indeed anyone else) cannot possibly meet.

The latter of course allows UKIP to put forward the criticism that Cameron cannot be trusted which conveniently helps prop up Farage's position. If one is to be cynical there's nothing better than having a perpetual enemy to oppose to justify your own existence, especially in the absence of any party polices.

Either way the eurosceptic movement is being very poorly served by UKIP.

Oftel, Ofcom And BT

With this piece we seek to explore the nature of the regulatory structure of telecommunications within the UK as illustrated in the above diagram. The intention is an attempt at simplicity which is to look at national, EU and international regulation in turn.

However problems emerge in the sense that such dividing lines don't truly exist - the EU for example is a fundamental part of the UK government, as is international governance. This becomes especially so with telecommunications. An example is that the Body of European Regulators for Electronic Communications (BEREC) has a direct relationship with the UK regulatory body The Office of Communications (Ofcom) as do indeed EU bodies such as COCOM.

So while we wish to deal with each in turn as an attempt to illustrate clearly the very complex world of telecommunications, we appreciate that there is a very fine line to be drawn between attempting simplicity and being inaccurate. With this in mind the above picture showing the EU as a separate 'cloud' and the following piece should be viewed with EU and international governance in mind, and as a consequence much overlap will occur over the next few pieces.

Yet even on just a domestic basis regulation is continually being updated, the above diagram was relevant until April 2014. The Enterprise and Regulatory Reform Act 2013, merged the ineffectual Office of Fair Trade and Competition Commission (established in 1999) to create the Competition and Markets Authority (CMA) meaning the diagram now looks more like this below:

Further domestic complexity was brought to the fore by the Scottish independence vote; that despite political and legislative devolution to Wales, Scotland and Northern Ireland, there aren't any formal mechanisms which involve the devolved legislatures with representation in telecoms governance and oversight.

Governance at a global, EU, ministerial and and regulator levels exclude representation from the UK's four nations. For example in the Scotland Act 1998 which established a devolved Scottish Parliament, telecoms was kept as a "reserved" matter - a constitutional term meaning that it was to be decided by the UK Parliament as per Section C10:

1.     Telecommunications and wireless telegraphy.
2.     Internet services.
3.     Electronic encryption.

With Scotland rejecting independence recently, telecoms regulation remains a democratic challenge within the UK. Ofcom appointed the Advisory Committee for Scotland (ACS) to advise Ofcom "about the interests and opinions, in relation to communications matters, of persons living in Scotland." However as only an advisory committee it sits to one side, unelected and unaccountable. The same lack of 'devolution adjustment' also applies to Wales and Northern Ireland. This could be consider unsatisfactory when telecoms across the UK have different needs with regard to rural location, broadband and 2G, 3G 4G mobile phone access.

Thus not unsurprisingly, with this in mind, the demand for an independent Scotland to have a say in telecommunications regulation was made in its White Paper, Scotland’s Future – Your Guide to an Independent Scotland (page 276):

The government of an independent Scotland will have the powers to properly prioritise the needs of rural Scotland in relation to telecommunications...

Scotland's dissatisfaction with regard to a lack of representation laid bare on page 311 (my emphasis):

We have also felt the impact of other decisions in communications policy that did not take account of Scotland’s circumstances. When 3G mobile licences were auctioned in 2000, an initial coverage target of 80 per cent of the UK population was set. This was increased to 90 per cent of the UK population in December 2010. Despite the efforts of the Scottish Government, a distinct Scottish target was not set. Currently, 3G coverage in Scotland is the lowest of the four UK nations, reaching only 96 per cent on the most optimistic estimates. 

Furthermore, there is a disparity between urban and rural Scotland. Coverage in rural Scotland drops to as low as 92 per cent, demonstrating that there will always be poorer coverage in rural areas unless these areas are given priority in allocating licences.

A contrast could be considered between the lack of telecoms representation by Scotland within Ofcom and with Ofcom's broadcasting responsibility - where the BBC, with its Audience Council Scotland, has a representative member for Scotland on the BBC Trust which is currently Bill Matthews.

To explain Ofcom's lack of coherence we can see that one of the notably observations taken from the above graph as indicated by the arrows is that in terms of its relationships with other interested regulatory bodies Ofcom has a prominent central role to play in UK communications regulation. But it is a role that is always inconsistent.

The lack of consistency has been a consequence of a lively mix of ever evolving nature of technology, of the growth of "regulator watching" and of the ever integration of the EU and international considerations.

Domestically the implementation of privatisation of previously nationalised industries under Margaret Thatcher led to a growth of "regulator watching" with often mixed success for the customer, and this was particularly apparent in telecoms.

Ofcom's predecessor was the telecoms regulator Oftel. Oftel was established under the 1984 Telecoms Act  which had privatised the telecoms market, known as the "Abolition of British Telecommunications’ exclusive privilege". It was the first major privatisation by the then Conservative government.

Oftel was often accused, particularly towards the end of its regulatory life, of being very sympathetic to BT and with good reason. BT's relationship with the regulator Oftel was one of "coercive-diplomacy" rather than a telecoms company being more subservient to an assertive telecoms regulator.

The relative impotency of Oftel largely stemmed from BT remaining intact instead of being broken up; a decision which reflected the government's view on maximising proceeds from shares and future tax revenues on what was the world's biggest telecommunication company. But by remaining effectively as a monopolist telecoms company BT had every incentive to exclude competition by refusing interconnection between networks or threatening competition by fixing interconnection charges as high as possible.

So what followed was "coercive diplomacy" between the powerful monopolistic BT and its less powerful regulator. This somewhat uneven conflict was particularly encouraged by modifications to BT's operating licenses. BT was entitled to reject licence modifications proposed by Oftel under Section 12A of the 1984 Telecoms Act.

Thus despite privatisation, many difficulties were experienced by other companies attempting to enter a market wholly dominated by BT, particularly with its inherent well established infrastructure. A problem acknowledged by Oftel itself in its 1st report of 1984:

BT is competing in a large number of spheres of activity in the telecommunications industry from a position of significant strength, resulting from such factors as its established reputation and its established customer base supported by a selling organisation of extensive scope. Understandably many organisations have been apprehensive about the possibility of effect competition in this situation.

Problematic regulation and promotion of competition could also be seen when Mercury (Cable and Wireless) obtained its licence in 1985.

According to condition 13.1 of BT’s licence at the time, any competitor which had been licensed had to enter into a connection agreement with BT to run a connectable system and therefore needed connection to BT’s network. BT's reluctance to succeeded a measure of market share became apparent in 1985 when Mercury and BT had failed to agree terms for a connection contract.

So Mercury applied to the Director General of Telecommunications (DGT) to make a ruling under the conditions 13.5 and 13.6 of the BT licence. However while the outcome eventually favoured Mercury, who had incurred significant financial costs, the difficulties of overcoming BT's market place dominance meant that UK privatisation of telecommunications remained little more than a duopoly until the early '90s.

BT's dominance as underpinned by Section 12A meant it could bypass Oftel by threatening to force the issue to go for consideration by the then Mergers and Monopolies Commission (MMC) - a body which was eventually replaced by the Competition Commission in 1999, (given further powers under the Enterprise Act 2002) and then itself replace by the CMA.

By going to the MMC then open up the possibility of third party challenges to the cosy and convenient alliance of both BT and Oftel. Thus at the time Section 12A gave both strong incentives to negotiate terms to avoid uncertainties outside the charmed world of telecommunications that a third party may induce. The threat of a big stick in the guise of MMC gave each party a mechanism which could be used to bear down pressure on the other.

As a result Oftel was to suffer from "regulatory capture" by BT, eventually becoming as a regulator unfit for purpose. A successor was needed to further open up the telecoms market to competition. That came in the form of Ofcom whose prominence as the major regulator was established by The Communications Act 2003 (TCA)

Yet it was less Oftel's failings as a regulator that led to its demise but more a need to implement a number of EU directives into UK law which resulted in the Communications Act - EU Directives which unsurprisingly sought to further harmonise communications regulation across the European Union under the guise of modernisation but naturally implied a further step towards EU integration. Such EU Directives included; Directive 2002/19/EC, Directive 2002/21/EC, and Directive 2002/22/EC.

Using these EU Directives the then Labour government established Ofcom which inherited the duties of five separate other former regulators - the Broadcasting Standards Commission (BSC) the Independent Television Commission (ITC), Oftel, the Radio Authority and the Radio Communications Agency.

Out of the TCA Ofcom became a "super regulator" and it comes as no surprise given Ofcom's inheritance that it was criticised for having "a too wide a brief". Not for the first time this was less a reflection of EU law and more the habitual enthusiasm of UK governments to gold plate EU law. Thus we have to query whether the initial establishment of Ofcom needed such a wide brief to comply with EU law or whether it was the political nature of the then Labour government which had unwelcome habit of reliance on big state solutions.

However it was not only the wide ranging powers that posed Ofcom problems but the inconsistency of those powers. Despite inheriting the briefs of the ITC, BSC and the Radio Authority it became clear that Ofcom was to have limitations in certain areas for domestic political reasons.

During the Parliamentary debate in 2002 on the Telecommunications Bill, Labour MP, Secretary of State for Culture, Media and Sport, Tessa Jowell argued in support of the Bill that:

Finally, part 5 gives Ofcom tough competition powers to act concurrently with the Office of Fair Trading. Ofcom will be able to use general competition powers, but we are also retaining, very importantly, sector-specific competition rules for broadcasting—a vital part of protecting markets that do not deliver key policy objectives purely by leaving them to competition alone. Ofcom will have flexibility to use sector-specific powers, but it will not use them where it would be more appropriate for it to use general competition powers.

Reading carefully Tessa Jowell's statement indicates very clearly that the BBC was not to be fully within the remit of Ofcom a single independent regulator for the UK's broadcast media. From the outset its creation is fatally flawed as long as the biggest and most powerful broadcaster is not fully under the supervision of the independent regulator for the UK communications industries.

Other issues which became apparent with the TCA 2003, as is typical of the UK's relationship with the EU, was that it took advantage of EU legislation as an excuse to go further with lawmaking and introduce other controversial parts. An example being, Section 127 of the Act 2003 which makes it:

...an offence to make improper use of a public electronic communications network such as grossly offensive, indecent, obscene, menacing or annoying phone calls and emails.

This was used notoriously used against Paul Chambers who joked on Twitter that he would "blow Doncaster airport sky high", a charge which he was subsequently cleared by the Supreme Court in London.

With Ofcom we can see that a consequence of a national regulatory body emboldened by new powers is that they purse paths different from government national bodies unhindered. In the UK this was reflected by Ofcom's decision in 2003 having been established by the TCA 2003, in response to the telecommunications market developing rapidly, to conduct what it called a ‘root-and-branch’ strategic review of the regulatory regime.

Unlike its predecessor Ofcom, determined to breakup BT's monopoly further, concluded in 2005 a major strategic review of the fixed telecommunications sector by using its separate powers under the Enterprise Act 2002 - itself a result of EU Directives. The objective of the review was to determine whether the sector was suffering from competition problems of such a persistent nature that they could not easily be remedied using Ofcom's specific market review powers under the TCA.

The outcome of the strategic review meant that BT offered a host of undertakings to Ofcom by which it agreed to set up a separate network access division called Openreach (a so-called "BT group business") and also to offer its wholesale products on an equivalent basis to both external customers (Cable and Wireless, Carphone Warehouse etc) and its own downstream divisions. The undertakings have brought about a fundamental shift in the way in which BT had conduct business with all its customers, meaning all were now on a more equal footing in terms of wholesale access.

Thus despite the EU inspiration behind TCA and the Enterprise Act, from a regulatory perspective, the establishment of Openreach and its relationship to external customers is currently unique to the UK and is being actively studied by regulators in other European countries who experience similar competition problems arising from the presence of a large incumbent telecommunications operator.

The term "super-regulator" though does not mean Ofcom is the only regulator when it involves telecommunications, there are at least sixteen others and the list below demonstrates with great clarity the criticism that Ofcom has a brief which is too wide, and a reflection of the diversity of telecoms: it has its tentacles everywhere:

1)   Advertising Standards Authority (ASA)
2)   Telephony Preference Service (TPS)
3)   Ombudsman Services
4)   Communications and Internet Services Adjudication Scheme
(CISAS)
5)   PhonepayPlus
6)   Internet Watch Foundation (IWF)
7)   UK Council for Child Internet Safety (UKCCIS)
8)   UK Safer Internet Centre
9)   Child Exploitation and Online Protection Centre (CEOP)
10) NICC - UK home of network interoperability standards
11) Go On UK - "empowering everyone in the UK to reach their digital potential"
12) NGN UK - dormant now part of OTA
13) Office of the Telecommunications Adjudicator (OTA)
14) Gambling Commission
15) Information Commissioner's Office
16) British Board of Film Classification (BBFC)

Not surprisingly with sixteen different organisations we have a complex mixture of Ofcom approved and EU financed regulatory structures. An example of the myriad structure can be found with the Internet Watch Foundation which came to media attention when it censored a Wikipedia page over an entry regarding an album cover by the German band The Scorpions. Here we see a registered charity, which works very closely with Ofcom (although Ofcom has no powers to regulate the internet) and receives EU funding. Susie Hargreaves the Chief Executive has also joined the BBFC’s Consultative Council.

Further evidence of the diversity and Ofcom's overreaching remit comes via the Advertising Standards Agency which describes a system as being one of "co-regulation of broadcast advertising" - it is self-regulation within a co-regulatory framework. It is underpinned by an enabling statutory instrument, The Contracting Out (Functions Relating to Broadcast Advertising) and Specification of Relevant Functions Order 2004 and a formal Deed between Ofcom and the ASA (Broadcast), BCAP and Basbof.

Interestingly Ruth Sawtell who is on ASA Council is also a non-executive director of PhonepayPlus, the regulator of premium rate telephone services.

In addition to the hydra nature of Ofcom, and its regulatory offspring, telecommunications are also responsibilities imbued within various government ministries and the agencies for which they are responsible, requiring within government itself a need for coordination as the table below illustrates (click to enlarge):

Thus it's apparent that even on a domestic basis telecoms regulation is diverse, overlapping and often incoherent. In the next piece we will move our focus away from domestic regulatory structures and turn our sights on the EU's role in UK telecommunications regulation.

EU Referendum: A Free Bet?

This blog has no ulterior motive other than to campaign to exit the EU a reflection of myself who was inspired to object to membership during the Maastricht debates and the ERM crisis. And as I made clear internally when I first joined UKIP, and stood as a PPC in 2010, my loyalty is to the cause not to any party.

However events change as they often do in politics. What I thought was not possible five years ago was that a major party would offer a referendum on EU membership as Cameron has done. Those who took part in very lonely campaigns over the last 20 years must be invigorated by the fact that the question of EU membership is starting to take centre stage.

In some ways UKIP can take the credit for this and for the about turn by Cameron. Despite Cameron previously refusing a referendum on the basis he wanted to stay in and deploying a three-line whip on the same basis, he has performed a very significant u-turn.

And he has done so as a result from pressure from his own party who in turn feel the heat from the rise of UKIP. It’s odd therefore that many in UKIP having extracted this concession now dismiss the Tories offer. One wonders what they actually want. Perhaps this is a reflection of UKIP’s long standing fundamental indecisiveness of whether it is a pressure group or a fully fledged party.

The latter seems to have won out and has a consequence become a party that not only jumps on every bandwagon going (when Nigel is not falling off it) but performs consistent rapid backtracking on party polices withing 24 hours as per VAT on luxury goods. Then in addition it often makes clear that it simply wants to destroy the Tories and nothing else. Somewhere in the mist the party's mission of exiting the EU has become somewhat lost.

Now it is understandable given Cameron’s track record of many not “trusting” him on this issue – an unprincipled, shallow, useless chancer he is. For me this for the eurosceptic side is a bonus – not only does his lack of authority and principles make him very vulnerable to his party’s whims but having an incompetent “general” in charge of the “in” camp is beneficial.

Thus for me it's not a question of trusting Cameron but strategy.  Like most in the country I don't trust politicians in general. Well actually more accurately I should emphasise that I do trust them…to do precisely what they’re told when they absolutely have to, for example the consequences of marginal seats concentrates the mind no end. That’s the nature of true power and democracy.

The EU referendum then becomes one that is more of a question of strategy and having a punt (worth noting that certain UKIP supporters bet against their party)

The brutal reality for those who wish an EU referendum is, as it stands, voting for any other party in 2015 will guarantee that we won’t get one, thus we stay in the EU for another 5 years. Labour won’t give us one, UKIP can’t and nor can any other party.

However… a Tory victory has given the possibility of a referendum in 2017. And in my view political reality says Cameron won’t have a choice but to deliver. If he wins the general election it will only be with a small majority giving rebellious backbenchers a lot of power. These backbenchers will consist partly of those who have campaigned for a referendum during this parliament and others who also simply just don’t like Cameron. Thus if he fails to deliver it is very likely that he will be out on his ear sharpish.

Of course despite this Cameron may be able to wriggle out of a referendum but in the event of that what would we have lost? Nothing other than 5 more years in the EU; the same as would be by voting for anyone else anyway.

So in betting terms what we have if we want a referendum is a free bet.

Outside The Wall

It's long been this blog's view that the status quo effect will prevail in the Scottish referendum, especially when the "don't knows" are hovering around the 23% mark. Thus while the polls recently have become neck and neck in terms of in or out, bookmakers are still offering odds-on regarding a no vote.

With Scotland there is understandably a clear anti-establishment vote which has been relayed to the pollsters. Yet experience shows that this only translates to referendum results, or indeed other elections, if the resulting vote has no dramatic consequences.

An example of this is the non-binding referendum in New Zealand in 1992 regarding political reform. We also see the same apply in mid-term by-elections where anti-etablishment kicking is prevalent only to return to a default candidate at a General Election. Ireland proves to be another example when they rejected the Lisbon Treaty first time around only to approve at the second time when it was made clear "rejection would have consequences" regarding EU membership.

An interesting observation though is despite the obvious anti-Westminster vote within the Scottish referendum, Cameron, Miliband and Clegg have decided to encamp in Scotland for the day so that there will be no PMQs, thus demonstrating a wonderful illustration of arrogance and complete political blindness - seemingly unaware that their presence is more damaging than helpful to the Union cause. Subrosa is not impressed and rightly so:

Interesting times aren’t they?  Yesterday, in a token gesture to Scotland, the Saltire was raised over 10 Downing Street.  I believe it is to stay in place until after the referendum.  How happy I am to see such benevolence from London. Do I feel patronised?  Of course not.

Be prepared for the media to be overflowing with reports about the London heir bummers’ visit to our country and don’t forget to smile at their ignorance (or should that be arrogance?).

A point echoed by Norman Tebbit:

The political establishment down here in the Westminster village has been stung into hyperactivity by the sudden surge of support for the Yes campaign in Scotland. Without very much discussion with their own parties Ed Milliband and David Cameron have reached a joint conclusion: that Scotland's discontent can be overcome and a "No" vote secured by promising the Scots that they can have independence in all but name if only they vote to stay within the Union. Devolution by the bucketload, it is implied, would allow the Scottish assembly to tax and spend as it pleases while still remaining under the cover of sterling.

It seems to be a perfect example of why so many Scots are supporting the severance of the Union. In short, it typifies the remoteness of that Westminster establishment, not just from Scotland, but the people of England and Wales.

And again, more forcefully by Dan Hodges:

By the evening Gordon’s chat with a few of his constituents had become a full-blown plan to recast the Union. It was, Brown said, nothing less than a move towards a federal Britain. “A new Union is being forged in the heat of debate”, he said.

Great. But what debate? I’m not involved in it. You’re not involved in it. Unless I’m missing something, no one in England, Wales or Northern Ireland is being given a say over this radical new constitutional arrangement.

I’m not missing something. Gordon Brown was crystal clear yesterday. “These reforms will confirm that Scotland has helped changed not just our own country but the United Kingdom,” he announced. Well, thanks for that. But I’m afraid that’s not Scotland’s prerogative.

Scotland is currently holding a referendum over whether it wishes to secede from the Union. It’s a simple Yes/No question. Do you want to stay, or do you want to go? Not, “do you want to unilaterally establish the English, Northern Irish, Scottish and Welsh Federation.”

’ll repeat, what do our politicians think they are doing? Whether or not Scotland remains a part of the Union is a matter for the Scottish people alone. It’s right they are having their referendum, and that they should have sole say over their destiny. But that is no longer what is on the table.

What is now being proposed – we are being told – is nothing less than an entirely new constitution for the United Kingdom as a whole. And no one other than the people of Scotland appears to be getting a say on whether they agree with it or not.

Actually, let me rephrase that. No one but the politicians appears to be getting a say.

Alex Salmond has some justification when he refers to "Team-Westminster". Team Westminster are clearly panicking and are offering overtly devo-max, this though is not new, it was offered quietly by Cameron some time ago. But how arrogant is it for Gordon Brown et al to now brazenly offer such terms without reference to anyone else in the Union  - it's our Union as well.

If nothing else the Scottish referendum demonstrates acutely that the arguments are less about Hadrian's wall and more about a circular symbolic wall around London, universally known as the M25.

We need this...

A Man Without A Plan

“A goal without a plan is just a wish.”

Antoine de Saint-Exupéry

Whether Scotland later this year agrees to go it alone or to remain part of the UK is of course a matter for them. What is interesting though about the campaign is how it it reveals with great clarity the problems with winning a referendum on removing a country from a union - changing the status quo. There are lessons in abundance that can be learned from the Scottish experience when considering the removal of the UK from another (albeit different type of) union - that of the EU.

The arguments of whether the Scottish people should run their own affairs democratically has been deliberately reduced down to mainly economic arguments by the Unionists; the Westminster village has closed ranks by taking advantage of the SNP's lack of preparation with regard to currency and undermining the independence case by opposing a currency union.

The three main Westminster parties are to declare that whoever forms the next UK government will not enter a currency union with an independent Scotland.

And FUD regarding Scottish exit has been in full flow:

Finance experts, academics and business leaders have raised fears that independence would destroy the economy, hit investment and force companies to migrate to England.

Words like "disaster" and "destroy" sound very familiar and is a foretaste of what we can expect come an EU referendum. Removing a country from a union needs an effective exit plan - in short a man with a plan - to negate the inherent fear factor. But as I've noted here and here, such a coherent strategy has been sorely lacking with the SNP and it is very likely to cost Salmond, and those supporting Scottish independence, the referendum.

As recent polling shows the independence vote is trailing significantly:

• Support for independence is 29%
  
• Support for remaining in the Union is 42%
• Don't knows 29%

Support for remaining part of the UK leads by a big margin, add into that the "status quo effect" inherent in any referendum and the fear factor on the "don't knows" and the campaign for Scottish independence looks doomed. Paddy Power's current odds are 2/11 against independence and 10/3 for. It would take a brave man to bet on Scottish independence.

With the referendum getting ever closer we can expect a ramping up of the same scare-mongering tactics. One such example is the Spectator this week where Alistair Daring exposes the weak links in Salmond's case:

Alex Salmond is now a man without a plan. He is offering Scots a future of uncertainty and instability. Threats of a debt default leaving Scotland and Scots with a bad credit rating. No idea which currency we would be transitioning to.

By contrast if Scots want to know the benefit of remaining in the UK, they need only reach into their pockets and pull out a pound coin. We have one of the most trusted, secure currencies in the world. We have the financial back up of being part of one of the biggest economies in the world. The pound means more jobs, smaller mortgage repayments, cheaper credit card bills and lower prices in the supermarket. Why would we gamble that for an unknown currency?

And so on...

Of course this isn’t the first part of their White Paper that has fallen apart. A few days ago Scotland’s accountants were damning in their assessment that there was no plan for paying pensions. The SNP’s own expert group admitted there was no plan for paying benefits. This is too big a decision to make without having a real plan.

Salmond has been criticised for the lack of preparation as 62% of Scots in a poll last year think the SNP's case is "not very convincing":

According to the survey for the pro-union Better Together group, 62 per cent of people said the SNP case was either “not very convincing” or “not convincing at all”. Twenty-four per cent of the doubters voted SNP in the last Holyrood election.

Thus as the SNP demonstrate having a referendum and being ill-prepared, leaves any independence campaign woefully exposed.

Be careful what you wish for...

Scotland And The EU

Today, in what appears to have been a low key affair, the Scottish first minister Alex Salmond launched his government's independence blueprint, calling it a "mission statement" for the future. Yet on first reading not a great deal has changed in the Nationalist's flawed case. The same problems remain as I noted here - there's still no coherent case on the issue of currency for example:

Alex Salmond has been pilloried after unveiling a blueprint for Scottish independence that assumes the English would continue to share the UK’s ‘crown jewels’ including the pound and BBC programmes.

Today's announcement appears to have been nothing more than a rebranding exercise. Certainly on the vexed issue of whether Scotland would remain members of the EU and if they would still retain the UK opt-outs on the Euro are still in doubt. The Referendum White Paper argues:

If we vote for independence, the eyes of the world will be on Scotland as our ancient nation emerges – again – as an independent country. Scotland will become the 29th member of the European Union...

Of course, as we are well aware, it cannot be both an independent nation and a member of the EU. Those two positions are completely incompatible. But crucially what the paper doesn't address convincingly is how Scotland will remain members of the EU on the same terms as it has now.

In Scotland's favour there is a kind of precedent that echoes their potential position and that is the one of Greenland. Greenland as part of Denmark joined the then EEC in 1973, despite 70% of the Greenlandic votes having been against membership in that referendum. However when Greenland gained home rule in 1979 it still remained a full member of the EEC. It wasn’t until it had a separate referendum on leaving in 1981 that it decided to leave. Even then it still has a special relationship with the EU as part of its overseas countries and territories.

Yet the EEC has moved on and we are now post Lisbon, so there is now no real precedent for how the EU should deal with a region of a member state seceding from the European Union, a situation the white paper itself acknowledges:

Article 49 of the Treaty of the European Union provides the legal basis, and defines the procedure, for a conventional enlargement where the candidate country is seeking membership from outside the EU.

As Scotland joined the EU in 1973 this is not the starting position from which the Scottish Government will be pursuing independent EU membership. Article 49 does not appear to be the appropriate legal base on which to facilitate Scotland’s transition to full EU membership.

This though is at odds with earlier comments made by EU Commission President Barosso who is of the opinion that Scotland would have to reapply for membership:

A letter from Mr Barosso to the House of Lords economic committee, which is examining the independence question, also confirmed his position that a new independent state would "become a third country with respect to the EU".

"What I said, and it is our doctrine and it is clear since 2004 in legal terms, if one part of a country - I am not referring now to any specific one - wants to become an independent state, of course as an independent state it has to apply to the European membership according to the rules - that is obvious."

Asked whether an independent country would have to renegotiate its terms, Mr Barroso said: "Yes.".

Ploughing on regardless convinced Article 49 does not apply, the white paper argues that there would be a "continuty of effect":

We recognise that specific provisions will need to be included in the EU Treaties as part of the amendment process to ensure the principle of continuity of effect with respect to the terms and conditions of Scotland’s independent EU membership, including detailed considerations around current opt-outs, in particular the rebate, Eurozone, Justice and Home Affairs and the Schengen travel area.

So apparently all an independent Scotland has to do is pursue membership of the European Union by seeking an amendment to the EU treaties rather than applying as a new member:

The alternative to an Article 49 procedure, and a legal basis that the Scottish Government considers is appropriate to the prospective circumstances, is that Scotland’s transition to full membership is secured under the general provisions of Article 48.

Article 48 provides for a Treaty amendment to be agreed by common accord on the part of the representatives of the governments of the member states.

Article 48 is therefore a suitable legal route to facilitate the transition process, by allowing the EU Treaties to be amended through ordinary revision procedure before Scotland becomes independent, to enable it to become a member state at the point of independence.

The problem is that Salmond with his assertions of "seeking an amendments to the EU treaties" via article 48 is now entering 'David Cameron territory' with his similar claims of trying to achieve the goal of repatriating powers. Article 48 is here - it only allows the EU treaty to be amended by unanimous consent.

This then becomes a paper which assumes the UK and the EU will agree with whatever Salmond demands. Unanimous consent which requires agreement of the UK - that Scotland has voted to leave - and countries like Spain, Belgium and Italy who have their own separatist problems and would be determined not to encourage further such sentiments. One suspects therefore Salmond's chances are going to be close to zero.

It illustrates yet again the problems of an ill-prepared independence case. It's difficult to see as a consequence any other option than Scotland voting to remain members next year particularly factoring in the status quo effect. But the lessons, which are so relevant to an EU referendum, are still not being learnt south of the border.

Thus sadly those who campaign to leave the EU are currently doomed to failure.

Update: Captain Ranty is not too impressed either, expressed in his own inimitable way.

"If You Fail To Plan Then You Plan To Fail"

Passing by without too much of a murmur south of the border is the Scottish independence referendum due to be held in September of next year. The relatively lack of comment is in direct contrast to the significant implications for the rest of the UK should the Scots wish to go it alone, not least on the thorny issue of the EU; would a breakup of the UK make our EU membership null and void? I've not heard a convincing answer on that one yet.

That aside, the referendum campaign has thrown up some interesting parallels to a potential EU referendum post 2015 and some lessons we can learn from. It should be noted first that there are one or two differences; with the except of a couple of forays by Cameron north of the border the Westminster establishment has largely refrained from interference. In addition polls consistently show Scottish voters supporting staying in the union, rather than exiting. Factor in the "don't knows" and the inherent "status quo effect" of around 15%, then it's clear the SNP and Alex Salmond has a very difficult, if not impossible, task. One suspects that Salmond has been forced to call a referendum earlier than he might have wished due to his success of winning a majority in 2011, leaving him little political choice.

Yet the useful parallels are imbued in a campaign that wishes to seek exit from a union it is a member of, a break from the status quo against the wishes of the establishment. Thus using the Scottish referendum as a dry run in anticipation of an EU one, it is immediately clear the effect major errors have on success or otherwise. Throughout it's becoming increasingly apparent that the SNP has no coherent exit plan in place which is compounding their already poor position - their case has been unraveling.

The referendum may have come earlier than Salmond hoped, but he seems remarkably unprepared given that the SNP is a party that has been in existence since 1934, and Salmond has been its leader since 1990 (albeit with a 7 year hiatus between 2000 and 2007).

Perhaps the lack of detail was the reason that Salmond preferred initially to concentrate on a sense of Scottish national identity and patriotism culminating, just before last year's Olympics, in the rather ridiculous phrase Scolympians:

In a bizarre intervention, the First Minister has devised a new group name for the Scottish athletes at the games that studiously avoids any British connotations.

Mr Salmond issued a good luck message urging everyone to cheer on the “Scolympians”, an inelegant combination of the words “Scottish” and “Olympians”.

Earlier this week, he issued a press release congratulating Sir Chris Hoy as being chosen as the Olympic flag-bearer for Team GB without mentioning the team’s name. 

But the scrutiny won't go away nor can it be papered over by vacuous appeals to national identity and scrutiny is what is now happening. For years the SNP has suggested that they received legal advice that an independent Scotland could remain in the EU and as a consequence inherit the UK's opt outs such as the Euro. Salmond went as far as to confirm it categorically (10:30 mins in):

The BBC’s Andrew Neil asked the First Minister on March 4 if he had sought legal advice. Mr Salmond replied: “We have, yes.

But it turns out that was never the case, as the Scottish Sun waded in with the headline "EU Liar":

THE SNP were forced into a humiliating climbdown yesterday after finally admitting the government had never taken legal advice on Scotland’s entry to the EU after independence.

The party’s referendum chief Nicola Sturgeon announced they were dropping a bid to block demands for them to reveal law experts’ guidance.

The Nats’ challenge has already cost taxpayers £12,000 as they battled to keep the details secret.

For a country to split while still being members of the EU would be uncharted territory legally, however many including the EU Commission, are of the opinion that Scotland would have to reapply for membership:

A letter from Mr Barosso to the House of Lords economic committee, which is examining the independence question, also confirmed his position that a new independent state would "become a third country with respect to the EU". 

"What I said, and it is our doctrine and it is clear since 2004 in legal terms, if one part of a country - I am not referring now to any specific one - wants to become an independent state, of course as an independent state it has to apply to the European membership according to the rules - that is obvious."

Asked whether an independent country would have to renegotiate its terms, Mr Barroso said: "Yes.".

Which then throws up the question of what happens to Scottish exports to the Eurozone while renegotiation was happening, given that they would have no right of access to the Single Market in the meantime as they immediately become a "third country". Exports would simply stop overnight. Such a possible scenario is a damning indictment of the SNP's lack of preparation and as a consequence has been hugely damaging to their cause.

Another big question is what happens to currency. This question has long been a problem for the nationalists. They have at various times supported an independent Scottish currency or even been cheerleaders for membership of the Euro. Currently they have instead settled on a currency union between an independent Scotland and the rest of the UK, a policy that seems to be a hasty response to changing circumstances, not least the Eurozone crisis. In short a least worst option.

But this comes with its own problems. It requires agreement of the rest of the UK and there's no guarantee of that. Also, as the Eurozone is painfully aware, currency union requires political and fiscal union to work. So there would need to be budgetary and fiscal constraints in place, a common system of banking regulation, so that the lender of last resort is not underwriting the debts of financial institutions over which it has no control. The UK will inevitably insist on tight controls on Scotland’s ability to borrow, and on its ability to vary the structure of its taxes. It will be political union in all but name. An independent Scotland would have no influence over the Bank of England but would still effectively be under its control, thus making a mockery of independence. Another ill thought-out policy.

Then there's the issue of the welfare state. A vote to leave the UK would be a vote to leave its institutions, including Department of Work and Pensions and the services it provides. A report backed by SNP ministers warned that pensions are at risk:

The study, by the Scottish Government expert working group on welfare, said creating a new system immediately after independence would be so complex that there would be a “significant” chance claimants would not receive their money.

This would also affect millions of pensioners and welfare claimants in England, the report claimed, because their payments are processed at Department for Work and Pensions (DWP) offices in Scotland.

But the report’s authors were forced to admit they did not know how the Scottish benefits system would be administered after [transitional period] because they had too little information about the policies that would be pursued.

The lack of detail means for Salmond that fear, uncertainly and doubt will be the deciding factor in the referendum - dull detail matters, not empty rhetoric. The lack of preparation will put back Scottish independence for generations meaning Mr Salmond, undoubtedly against his wishes, will die a UK citizen. It has turned into a campaign where professionals are knocking seven bells out of the amateurs as Jim Sillars in the Holyrood magazine observed (my emphasis):

These inherent fault lines should have been addressed long before there was any launch of a Yes campaign. The lack of what I call “the Bible” – that is, a document based on asking all the difficult questions and providing the answers, which then delivers solid well researched, intellectually tight material for activists to use – is proving fatal. Currency, EU membership, Nato, pensions both state and private, are but four examples of work not done or sloppy thinking.

Given the woeful performance of the SNP leadership so far, it is a foolish gamble to believe that when they produce the civil service-created White Paper in the autumn, that it will fix things. There needs to be a much wider involvement in the production of a “Bible” without which Westminster will continue setting the agenda and continue to run rings round the Yes side.

It all sounds so wearily familiar, but at least we've been warned. In an EU referendum we also need to provide a "Bible" that answers difficult questions such as the one posed by Autonomous Mind:

On Day One of [unilateral withdrawal] how will British goods will be landed in continental Europe and sold into the EU market.

Otherwise we follow Salmond down the path of glorious failure.