Alex Salmond vs. Alistair Darling on Scotland’s future as an independent nation.

The referendum on Scottish independence will be held on Thursday the 18th of September. What I attempt to do here is provide a summary of last night’s debate and publish the points that each politician has made. The only direct quotes come from audience members. This is not a transcript and only words contained in quotation marks are verbatim. This is not a print out of what was said at the debate, it is an explanation.

Contents:

I. The two key players

II. Opening statements

III. The economy

IV. Scotland at home

V. Alistair Darling cross-examines Alex Salmond

VI. Alex Salmond cross-examines Alistair Darling

VII. Scotland in the world

VIII. After the referendum

IX. Closing statements

The two key players:

Alex Salmond: leader of the Scottish National Party and First Minister of Scotland since 2007. Fighting for Scottish independence with the Yes Scotland campaign.

Alistair Darling: MP for Edinburgh South West, former Chancellor of the Exchequer and leader of the Better Together campaign.

Opening statements:

Alex Salmond: In 1979, we saw the deindustrialization of Scotland under Thatcher. In 1997 we finally gained a Scottish Parliament. We introduced free personal care for the elderly and removed tuition fees. Helped the old, provided opportunity for the young. There is too much Westminster control over Scotland – illegal wars, the bedroom tax, welfare cuts, the spread of food banks, billions wasted on weapons of mass destruction. We have an opportunity to change all of that. Nobody can run Scotland better than the Scottish. Since 1979 the voices of doom have told us we can’t do it. They’re wrong. We are a rich nation and a resourceful people. We can create a fair society.

Alistair Darling: Alex Salmond asks us to take his word for it. He has no Plan B for anything. Here is the basic difference between me and Alex: I want a fair and better society in the UK, he wants a separate state no matter what the risk. People do want change, but they also want security in their jobs, pensions and their children’s future. If we stay together, we can give the Scottish Parliament more powers. We’ve done it before and we can deliver again. What we need tonight are answers on the questions of Scotland’s proposed currency, interest rates, mortgage rates, jobs and public services. There is a risk to the NHS, but it’s not the scare stories Alex Salmond gives us. It’s too much of a risk, let’s share it. Let’s be part of something bigger. There is no turning back.

The economy:

Audience member: “Would we be financially safe in an independent Scotland?”

Alistair Darling: It depends on currency. The security that comes from being in a country as large as the UK and it’s financial backing stops Scotland from going over the edge. Greater financial security comes from being with the UK and Scotland’s industries do well because of the backing of the British system.

Alex Salmond: I would share the pound sterling with the rest of the UK in what’s called a currency union. Our biggest export market is the rest of the UK and Scotland is the UK’s second biggest export market. So keeping the pound keeps our market intact. If a currency union falls through, a Scottish pound attached to UK pound like the Denmark or Hong Kong system would be the best Plan B. And nobody can stop us from using the pound sterling anyway because it’s an internationally tradeable currency.

Glenn Campbell: About oil and the North Sea: Alistair Darling, isn’t it the case that the figures from the UK government’s independent Office for Budget Responsibility are too low – they say there’s only 10 billion barrels left but the industry says 24 billion?

Alistair Darling: Over the last 20 years, successive governments have been too optimistic about the revenues from the North Sea. In the last couple of years, the revenue has been £5 billion less than we expected. If an independent Scotland lost that sum in any one year, it would have a £5 billion deficit. That’s the equivalent of finding its entire school spending budget and half of it’s entire NHS budget, which means you’d have to raise taxes or cut back on public spending. We’ve never extracted as much North Sea oil and we’ve never made as much money as predicted. An independent Scotland would get 15% of its total revenue from the North Sea, and if they don’t get the full amount, that leaves the budget in crisis. The Scottish government has been wildly optimistic about the oil revenues.

Alex Salmond: The OBR is supposedly independent and can be trusted, but Alistair Darling himself has said it is part of the Conservative Party. Some estimate that there are 17 to 18 billion barrels left in the North Sea to be extracted over the next 30 years. In financial terms, that is worth £1 trillion. The Tories and the Labour Party are the only people in the world who see massive amounts of oil and gas as a curse. Every other country in the world sees it as a blessing.

Alistair Darling: Once it’s gone it’s gone; every barrel we take out of the North Sea means there’s one less barrel in the North Sea. An independent Scotland would be so dependent on natural gas and oil that when it’s gone they’d be left with a deficit equal to their entire school budget and half their NHS budget.

Alex Salmond: 20% of Norway’s overall economy comes from natural gas and oil and they’ve not done too badly over the last 40 years. Darling’s colleagues estimated said that oil and gas would run out by the year 2000. They’ll be with us way beyond 2050. Every European country would give their left arm for North Sea oil and gas. It is a substantial asset.

Alistair Darling: But it’s notoriously volatile and it’s a risky asset to make up a substantial part of the economy.

Audience member: “Exactly what currency would an independent Scotland use if we don’t use sterling?”

Alex Salmond: I’m seeking a mandate. We should share the pound sterling in a currency union with the UK. It’s best for Scotland and best for the rest of the UK. Sign me into negotiations to use it. Giving me a mandate to keep the Pound sterling because it’s what’s best for Scotland. There’s other things Scotland could do but the best thing is a currency union. Why would I go in arguing for second best?

Alistair Darling: A currency union requires both parties to agree to it. Yes, there is a sovereign will for the Scots to decide what to do, but also for the UK to decide whether to agree. Why would the UK join a currency union if it won’t even join the Eurozone? Scotland would be a foreign country with a foreign budget and that wouldn’t look good to the UK. Our budget would have to be sent into the UK for approval just like what happens in the Eurozone. What’s Plan B? Salmond can’t or won’t say. I don’t want a Scottish euro, I don’t want a Panama model (using somebody else’s currency with no central bank) and I don’t want a separate Scottish currency either. What is Plan B?

Alex Salmond: If people back the plan to keep the pound sterling, will you accept the will of the Scottish people? If you’re truly a democrat?

Alistair Darling: I will always accept the will of the people but the currency union is a second best option for Scotland. I want the pound sterling and the pound sterling only works if you have an economic and political union with the rest of the UK.

Glenn Campbell: Alex Salmon you’ve said no to the euro and you’ve said a separate currency needs to be argued for by somebody who wins an election.

Alex Salmond: We don’t need permission to use our own currency. All the UK can deny us is the financial assets that come with it from the Bank of England. But there’s no way they’ll do that because if they do, all the people in Wales and England and the rest of the UK watching tonight will be stuck with all the debt. There’s no way given the enormous debts that Alistair Darling and George Osborne built up that the UK wants to let £5 billion of debt (that we’ve offered to pay) per year slip away. If the UK denies us the financial assets that come from a central bank, it denies us the requirement to share its debt.

Alistair Darling: If you’re using somebody else’s currency, you don’t have a central bank. Countries that use other currencies like Panama and Ecuador, they must always run a budget surplus and they can’t borrow from the host country. That means they have to pull money out of public services.

Glenn Campbell: But if the UK refuses a currency union, does it leave itself liable for all accumulated debt?

Alistair Darling: If you’re first message as an independent Scotland is ‘here we are, we’ve a new currency and we just defaulted on our debt’, what do you think the international lending community is going to do? Nobody would lend you money.

Alex Salmond: You can’t default on a debt that isn’t yours in the first place. They cannot stop us using the pound.

Glenn Campbell: Alex Salmond are you saying that if the UK refused a currency union, an independent Scotland would refuse to take a share of the debt?

Alex Salmond: They can deny us the access to Bank of England assets. The BoE hold 27% of UK’s debt and we’re offering to pay a fair share of the debt within a currency union, but if the UK takes all their financial assets with them, they’re stuck with the financial liabilities.

Audience member: “For Alistair: If a currency union is the second best option for Scotland, what’s first?”

Audience member: “The Yes side makes a lot of promises without speaking to the other parties. If we leave the UK we may be forced to take on the Euro in a matter of years because we’d be a member of the EU”

Alex Salmond: We should have a fair share of the debts accumulated by the UK under a currency union. But where the EU is concerned, you cannot be forced to adopt the euro. Sweden is politically in exactly the same situation as an independent Scotland would be, but Sweden’s not been forced to take it on. Taking on the euro is totally voluntary. Alistair seems to rule out absolutely everything – why would Scotland be the only country in the world that can’t have a sensible country?

Alistair Darling: They’re all second best options and I won’t argue for any of them. The pound sterling without independence is the best option for Scotland. The value of the pound is down to the BoE standing behind it and the UK government standing behind them. It is the case that every country that joins the EU after 1996 has been obliged to join the euro. As for a currency union; even if one was made you’d have foreign government in London deciding how debt should be shared.

Scotland at home:

Audience member: “How would independence improve or change the NHS for everyone, in particular people with chronic illnesses?”

Alex Salmond: The NHS must be kept safe and properly financed for everybody in public hands. Because of devolution we can’t be forced to privatize the NHS because we have operational control of it. But we don’t have financial control of it. Spending has been reduced massively in Westminster which has had a knock-on effect on the Welsh NHS. The danger is this: If England goes down the road of privatization and charging, we can’t be forced to privatize, but we won’t get the money for our NHS. We need a Scottish NHS that is entirely under Scottish control, both financially and operationally.

Alistair Darling: Being part of the UK means we can fund the Scottish NHS properly. The total control of the NHS lies with the Scottish government and Parliament, both financial and policy wise. The Scottish government can decide how much to spend and where. Public spending is £1200 per head higher than the rest of the UK because of the strength of the UK. Taking on a risk without knowing what currency you’re using is a massive threat to the Scottish NHS.

Glenn Campbell: If a Yes vote is the only way to protect the NHS, why doesn’t it say that in your white paper on independence?

Alex Salmond: It’s been a long term case for independence. I’m not saying we can be forced to privatize the NHS in Scotland. What I am saying is that a move towards privatization and cutbacks puts pressure on our NHS. The Welsh Labour government has been forced to make cuts because of the budgetary pressure from Westminster. The general cutbacks to the Scottish budget have been 8%. If we decide to protect the NHS, which we have, that’s a third of our spending gone. It means the rest of our spending takes a 12% cut. A privatization agenda in Westminster means less public money spent in England which means less in Scotland. To protect the Scottish NHS we have to govern it financially.

Glenn Campbell: If the SNP is wrong, why has Shadow Health Secretary Andy Burnham been warning about the NHS’s demise?

Alistair Darling: Because of the private sector provision argument. Whether the NHS spends its money directly or through the private sector, it still gets spent. But NHS spending carries on increasing. That leaves me to wonder why Alex Salmond only mentions the NHS once in his last debate and why his constitution doesn’t even mention it. He uses scare stories to make a point that has nothing to do with the referendum.

Audience member: “Alistair Darling, your Labour government started privatization of the NHS and half your boys in Westminster have investments in private health services”

Audience member: “Is the real threat to Scotland’s budget the scrapping of the Barnett formula?” (the way in which public expenditure is shared across Northern Ireland, Scotland and Wales depending on the public expenditure levels in the UK)

Alistair Darling: Scotland has an ageing population in Scotland and a rising spending need. Leaving the UK would leave us more at risk. A financial black hole that would put the Scottish NHS in danger.

Alex Salmond: The risk to the NHS comes from Westminster’s cutbacks. The UK Labour party is warning loud and clear of privatization and the Welsh party say they’ve been forced to cut health spending. Are you the only person who doesn’t realize that the NHS in Scotland is already under threat?

Audience member: “If we are better together, why aren’t we better together already?”

Alistair Darling: We can be better. For example I visited a developed advanced medical centre in Scotland which tries to cure cancer. They’re there because Dundee attracts a large share of UK research money. We will lose that centre of expertise and the jobs that come with the treatments and products it creates, if Scotland goes independent. Or take the Royal Navy which will be lost if we put a barrier between firms, businesses and markets between us and the UK.

Alex Salmond: I’ve been working all week with the Ferguson yard. We’ll be able to sustain the Ferguson yard if we go independent. As far as other jobs are concerned, the future for shipbuilding jobs requires diversifying vessels. Employment in the ship industry has gone from tens of thousands to three thousand because of the UK.

Glenn Campbell: Alistair Darling, the Scottish government estimates that because DLA is being replaced with PIP, disabled Scots will lose money. Do you support the reform?

Alistair Darling: No, but you need the means to support people. If you end up in a situation where you cut off firms that pay for these things it’s going to be less likely that you can provide these supports in the future. When you look at the burden of health care costs, why would you remove the UK that supports them?

Alex Salmond: 100,000 disabled Scots are being failed by welfare reforms. It’s an indictment of the way Westminster has handled social security. When you’re in difficult economic times, don’t take it out on families and children and the disabled with the bedroom tax.

Glenn Campbell: You may well have to make these choices too.

Alex Salmond: We made a choice. We compensated people for the bedroom tax. We had to take £50 million to compensate people so they didn’t suffer under the bedroom tax. If we controlled welfare, the tax wouldn’t exist.

Alistair Darling: The bedroom tax is thoroughly bad in every respect. If Labour is elected next year, we’ll repeal it.

Alex Salmond: You’re in bed with the Tory party if you’re with Better Together.

Alistair Darling cross-examines Alex Salmond:

Alistair Darling: Back to currency: What’s your plan?

Alex Salmond: A currency union is best for Scotland. The other options consist of a flexible currency union, fixed exchange rate, but we cannot be stopped from using the pound.

Alistair Darling: The currency is the foundation of our economy. Ask yourself what happens if you don’t get Plan A, the currency union.

Alex Salmond: I’ve set out the options in great detail. Will you support a currency union?

Alistair Darling: What if you don’t get the currency union?

Alex Salmond: There’s 190 countries in the world and a range of currency options. According to you, an independent Scotland would be the first country in history where all the currency options are bad. Will you campaign for the sovereign will of the Scottish people if they vote for independence?

Alistair Darling: People want to know what will happen to the money they’ve got if they don’t get a currency union.

Alex Salmond: We cannot be stopped from using the pound. There will be a currency union because UK doesn’t want to get stuck with all the debt.

Alistair Darling: North Sea oil revenues were £5 billion less than you expected last year. With the UK that can be dealt with. How would you make it up alone?

Alex Salmond: There’s no black hole. This enormous natural resource can be dealt with. Oil companies have invested £13 billion to put production up. That investment is offset against revenues. Scotland would be prosperous if it was independent. your government had a deficit of 150 billion, why should we trust what your predictions for Scotland are?

Alex Salmond cross-examines Alistair Darling:

Alex Salmond: How many children in Scotland is it estimated that will move into poverty by 2020 because of the government’s spending cuts?

Alistair Darling: It depends on government policy but my government halved it.

Alex Salmond: 100,000 extra children moving into poverty with welfare reforms. Is that a price worth paying for Better Together?

Alistair Darling: I don’t agree with the Tory reforms and I want to see a Labour government.

Alex Salmond: The Labour Party has said they will continue with the current government reforms. 100,000 extra disabled people losing money also. Is that a price worth paying?

Alistair Darling: You’ve cut a billion pounds from anti-poverty funds.

Alex Salmond: Why are you standing here defending government policy with Better Together?

Alistair Darling: I disagree with all of you. You’re in bed with people you wouldn’t normally be in bed with too. We can get people out of poverty together.

Alex Salmond: The UK can starve our NHS of resources, isn’t that right?

Alistair Darling: The amount of money spent on the NHS has increased. It’s for you to decide how much is spent, don’t blame other people.

Alex Salmond: How much will it cost to replace the Trident nuclear system in 2020?

Alistair Darling: You don’t choose between defending the country and spending health services. But it will cost £80 billion.

Alex Salmond: We can choose not to spend it if we’re independent. Is Trident a sensible use of spending under current economic circumstances?

Alistair Darling: We have an obligation to defend this country.

Alex Salmond: Name three job creating powers Better Together will give us.

Alistair Darling: The devolving work program, guaranteeing that unemployed people get back in training,

Alex Salmond: The work program pays people poverty wages, what are the job guarantee devolutions you’ll give?

Alistair Darling: More powers in relation to welfare.

Alex Salmond: Three job creating powers.

Alistair Darling: The best way of guaranteeing jobs is staying together.

Alex Salmond: Three job creating powers.

Alistair Darling: All you’ve got is a promise that whatever corporate tax rate George Osborne decides, you’ll go three points lower. What good does that do?

Scotland in the world:

Audience member: “What’s gonna happen when they scrap Trident, what’s gonna happen to the jobs, people and housing after it’s scrapped?”

Alex Salmond: The SNP will remove trident from Scotland. Reports show that any other expenditure would generate more jobs than spending on Weapons of Mass Destruction does. WMDs will be removed from an independent Scotland because they’re morally wrong and a massive waste of money.

Alistair Darling: If Trident were to go, all of the submarine jobs will go with it. We can ill afford another 8,000 jobs from the Clyde and West Scotland. I understand why people are against Trident but moving them to England won’t change the number of nukes and will destroy 8,000 jobs. It’s the wrong thing to do both in military and job terms. It would be a massive blow to West Scotland.

Glenn Campbell: Alex Salmond you talk about a 10 year transition to proper defense in Scotland. How long before Her Majesty’s Naval Base in Clyde has as many people working in it as it would have under the UK?

Alex Salmond: We accept that Trident can’t be removed immediately. 5 and a half years is our deadline. As it’s removed, it enables us to build up defense forces. Faslane will be the head of Scottish Defense Forces.

Glenn Campbell: What about the scale of employment?

Alex Salmond: Onshore jobs, very substantial. Navy jobs, very substantial. Scotland has no surface defense ships to defend the North Atlantic and our oil resources. It’ll take 10 years to build up our defense forces and 5 and a half to remove Trident. People in England might make a choice to not proceed to the next generation of Trident submarines with 100 billion price tag, and I hope they do.

Audience member: “To spend 365 million to move Trident and leave 7,000 people without jobs is not reassuring”

Audience member: “Given that removal of Trident would open up the Clyde for oil exploration would replace any jobs lost by Trident?”

Glenn Campbell: The Royal United Services think-tank thinks it’s possible to move trident but only by 2028.

Alex Salmond: They argued that to move Trident would be 5 and a half years but the weapon establishment would take longer. 5 and a half years is a reasonable timetable. It’s ludicrous to suggest that 5 million people should harbour Europe’s largest collection of nuclear weapons. Any conventional forces would generate more jobs than nuclear ones ever could. I could think of 100 things it would be better to spend money on than nuclear weapons.

Alistair Darling: Why would you join the NATO military alliance if you’re so against Trident? In relation to cost, yes the experts said it could take 2028 to move it which could be very expensive. 8,000 (not all nuclear) jobs are at risk here. The Royal Navy does not build war ships in foreign countries so you’d have to wait 10 years before Scotland could start building warships.

Glenn Campbell: The UK says it isn’t planning for Scottish independence or to move Trident, do you believe that?

Alistair Darling: Yes because the whole point is to find out what Scotland votes for. We have to get it right. We can’t go back. They’re not planning because there isn’t a mandate to enter negotiations yet.

Alex Salmond: It’s disgraceful that they haven’t made any plans for Scottish independence but it’s because they don’t take us seriously. Why don’t they expect the sovereign will of the people to vote Yes?

Glenn Campbell: Are you willing to negotiate on the removal of Trident?

Alex Salmond: Our objective is to remove Trident from Scotland. We can be a member of NATO because their president is from Denmark which is a non-nuclear country and their president before him was a member of a non-nuclear country. Trident and NATO have nothing to do with each other.

After the referendum:

Glenn Campbell: This is a divisive campaign. How will Westminster and Holyrood work together after this vote and how will yes and no voters react to each other?

Alistair Darling: I used to think it was just an election but it has gotten very heated. It’s important that both sides have to accept whatever the result. I hope people do reject independence and work together to build a better and stronger and fairer Scotland. Major issues need attending to no matter what the result.

Alex Salmond: I agree with much of that. I think this has been an extraodinary energizing campaign which has brought out non-voters to the front of politics. In the aftermath, we have to bring Scotland together. I’ll do the 18 months of negotiations along with all the best talents of Scotland to get the best possible settlement. Once the referendum is over, it’s a matter of team Scotland.

Closing statements:

Alex Salmond: The decision we make in three weeks will define our generation and the future of the nation. Few societies have been given the opportunity to get independence. It may never come again. Our country will be taken into our hands. We’ll have challenges and we must rise to them and solve them. All of the No campaign has absolutely nothing positive to say about the future of Scotland. In each and every independent election we will get the government we vote for and their choices will be reflected in policy. It will be placed in Scottish hands. This referendum is about the future of Scotland and it should be in the hands of the Scottish. We can govern ourselves better than anybody else can. This is our moment, let’s seize it.

Alistair Darling: No country the size of Scotland can compare in invention and medicine. It gave the world the age of enlightenment. We could go it alone, but we won’t be as successful. We will do better and build on our strengths with the UK. I raise the issue of currency again tonight because any country’s starting point is currency. Uncertainty about currency is risky. Scare stories about the NHS are beneath contempt. We’ve now had three and a half hours and I’ve yet to hear a straight answer. Alex Salmond says we don’t need to know what Plan B is. We do not need to divide this island into separate states to assert our national identity. We all have no option but to politely and respectfully say No to independence.