Every Brexit option will harm Scotland, says new Scottish Government study

While new analysis predicts every Brexit scenario will cost Scotland billions, Nicola Sturgeon makes a “pragmatic” case for single market membership

ALL OF THE MOST LIKELY post-Brexit scenarios will have negative economic repercussions on Scotland, new analysis from the Scottish Government indicates.

Published on Monday morning, ‘Scotland’s Place in Europe: People, Jobs and Investment’ is an in-depth study of Brexit’s potential impact on Scotland and its economy of the kind the UK Government has thus far refused to release.

The study presents data on the expected outcomes of the three most commonly acknowledged possible arrangements between the UK and the European Union in the aftermath of Brexit taking effect: continued membership of the European single market, a free trade deal similar to that of Canada, and a ‘no deal’ hard Brexit, under which the UK would revert to trading under World Trade Organisation rules.

Speaking at the publication press conference, Sturgeon reiterated the Scottish Government’s position that the best scenario for Scotland would be to remain in the EU, however acknowledged that present circumstances demanded pragmatism, before making the case for the importance of single market membership.

“This analysis shows that none of these options are as good as staying in the European Union.” First Minister Nicola Sturgeon

“This analysis shows that none of these options are as good as staying in the European Union,” said Sturgeon. “Our economy will take a hit under all of them.”

The new analysis concludes that in the event of a ‘no deal’ hard Brexit, Scotland’s Gross Domestic Product (GDP) will be 8.5 per cent lower by 2030 than if Scotland stayed in the EU. This would be equivalent to a loss of £12.7bn, or £2300 for every person in Scotland.

In the event of a free trade agreement between the UK and the EU, Scotland’s GDP would be just over 6 per cent lower, equivalent to £9bn or £1600 per head.

Describing continued single market membership as the “least damaging option”, Sturgeon quoted the study’s findings that under the single market option, Scotland’s GDP would only be reduced by 2.7 per cent, which would still be equivalent to £4bn, or £700 per head.  

“The UK Government must stop being driven by the obsessions of the hard Brexit wing of the Conservative Party.” First Minister Nicola Sturgeon

The fact that the Scottish Government’s new analysis is more detailed and comprehensive than anything released by the UK Government on the subject “spoke volumes”, Sturgeon said, about the UK Government’s “reckless and irresponsible” approach to leaving the EU.

As Prime Minister Theresa May’s government prepares to embark upon the next phase of Brexit negotiations, Sturgeon commented: “The UK Government mustn’t waste time in this next phase seeking what they know to be unachievable. Common sense and hard-headed economic considerations should prevail from the start this time.

“The UK Government must stop being driven by the obsessions of the hard Brexit wing of the Conservative Party. Keeping the Tory party together in an uneasy truce cannot and must not be a more important consideration and aspiration for the UK Government than the job prospects, living standards and opportunities for this and future generations.”

“Either Jeremy Corbyn is still misunderstanding the position of the single market, which given how often it has been pointed out to him can’t possibly be the case, or he is now trying to deliberately mislead people.” First Minister Nicola Sturgeon

Sturgeon also criticised UK Labour leader Jeremy Corbyn. After arguing that there was a majority outside of the Conservative Party in favour of single market membership, Sturgeon said :”The bigger issue in order to get to that majority is to get Jeremy Corbyn off of the ridiculous position that he is in.

“Either Jeremy Corbyn is still misunderstanding the position of the single market, which given how often it has been pointed out to him can’t possibly be the case, or he is now trying to deliberately mislead people with this line that you cannot be in the single market if you’re not being in the EU. Norway stands as the living proof that that is just not the case.”

“People in Scotland voted decisively to remain in the European Union and we continue to believe this is the best option for Scotland and the UK as a whole.” Minister for Negotiations on Scotland’s Place in Europe Michael Russell

Commenting further, Minister for Negotiations on Scotland’s Place in Europe Michael Russell said: “People in Scotland voted decisively to remain in the European Union and we continue to believe this is the best option for Scotland and the UK as a whole. Short of EU membership, the Scottish Government believes the UK and Scotland must stay inside the Single Market and Customs Union.

“The decisions taken in the next few months will be crucial for jobs, wages and opportunities for generations to come and it is vital that the Scottish Government are properly engaged in these decisions.”

The analysis also placed heavy emphasis on the importance of migration to Scotland, highlighting Scotland’s demographic challenges and the significance of population growth over the coming decades. Sturgeon described the new study as part of a continued attempt to “change the narrative” around migration, while acknowledging politicians often find it a difficult subject.

“It is time for Labour to come on board and protect our UK and Scottish economies.” Scottish Liberal Democrat leader Willie Rennie

Responding to the publication of the new Scottish Government analysis, Scottish Liberal Democrat leader Willie Rennie said: “The economic paper today is worthwhile and sets out some stark economic impacts for the UK from Brexit.

“It adds to last week’s research by Sir John Curtice showing that public opinion is shifting. A majority of people across the UK now expect a bad deal.

“So it is right for a consensus to be firmly built. Vince Cable met with other party leaders last week to build the case for the single market.  The Scottish Government’s economic research is helpful analysis.

READ MORE: Scotland can “make a stronger case against Brexit”, says European think tank chair

“It is time for Labour to come on board and protect our UK and Scottish economies.”

However, Rennie went on to demand that the SNP drop the threat of a second independence referendum, despite continued Liberal Democrat demands for a second referendum on EU membership.

“Full access to the single market is clearly the least damaging option for both Scotland and the rest of the UK.” Scottish Green MSP Ross Greer

Scottish Greens external affairs spokesperson Ross Greer MSP also commented on the new study, saying: “This analysis adds more weight to the many others, including from LSE and the Fraser of Allander institute, confirming that Brexit will be devastating for Scottish jobs and communities.

"It is vital that we keep as close a relationship to the EU as possible. Full access to the single market is clearly the least damaging option for both Scotland and the rest of the UK so it is disappointing to see Scottish Labour refuse to join us in arguing for this and instead essentially choosing to back the Tories' jobs-destroying Hard Brexit."

“It’s only Labour that will negotiate a new relationship with the single market that retains its benefits, or a new bespoke trade deal that protects our economy." Scottish Labour MSP Neil Findlay

Neil Findlay MSP, Scottish Labour’s Brexit spokesperson, did not address criticism of Labour’s position from Sturgeon and others, instead arguing in response to the study: "It is telling that on the day Carillion goes into liquidation the First Minister is back on her constitutional offensive whilst offering no reassurance to the Scottish workers impacted.

"The truth is that it’s only Labour, at a UK and Scottish level, that has a plan to invest in our public services, our industries and our people and communities - and it’s only Labour that will negotiate a new relationship with the single market that retains its benefits, or a new bespoke trade deal that protects our economy."

Picture courtesy of the First Minister of Scotland

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