Programme for Government 2019 to 2020

Scotland's future and our place in Europe

The European Union is a group of 28 independent countries which have come together on the basis of shared values to create the world's biggest single market and trading bloc.

The Scottish Government believes the best future for Scotland is to become an independent member of the EU.

Scotland is a wealthy country and is particularly well-placed to benefit from, and contribute to, Europe's future, with our extraordinary energy resources, some of the world's best universities, our leading role in many cutting-edge industries and commitment to the EU's founding values.

In 2016 people in Scotland voted overwhelmingly against Brexit. That vote, however, was ignored by the UK Government. A subsequent compromise offer that would have kept the whole of the UK in the Single Market and Customs Union was also dismissed.

The current UK Government now says it is determined to leave the EU with or without a deal on 31 October. It has said that the 'backstop' for the island of Ireland 'cannot form part of an agreed Withdrawal Agreement'. This, and other comments and actions of the Prime Minister, have dramatically increased the chances of the UK exiting the EU on a 'no deal' basis. Indeed, it appears that the UK Government is actively pursuing a 'no deal' Brexit.

The Scottish Government will continue to work with others in Scotland, the Welsh Government and people across the UK to do all we can to prevent such a disastrous outcome, including by supporting a second EU referendum with remain on the ballot paper and the revocation of the Article 50 process in the event the UK is facing a 'no deal' Brexit.

However, regardless of what happens over the next few months, it is clear that Scotland's interests are not best served by Westminster. The House of Commons has been in turmoil for much of the past three years and now faces an unprecedented democratic crisis given the Prime Minister's plans to suspend the UK Parliament for several weeks prior to the planned date of exit from the EU.

The Scottish Government is therefore preparing for all eventualities.

Preparing for a 'no deal' Brexit

Given that a 'no deal' Brexit is an increasingly likely outcome, we will do everything we can to ensure that we are as prepared as we can be, while being honest that we cannot prevent all the damage that it will cause.

A 'no deal' Brexit will mean that on 31 October, the UK's status under EU law will change from that of an EU Member State to that of a 'third country', with no trade or cooperation agreements in place with the EU. There will be no transition period and no 'managed no deal'. The UK will immediately be outside the Single Market and the Customs Union and will no longer be part of the framework of EU law.

In this scenario, it will be impossible for the UK to maintain the current seamless arrangements with the EU across the full range of sectors, from justice and security, transport connectivity, trade flows and supply chains and medicines regulation.

Leaving the EU without a deal in an October timeframe will bring with it additional challenges due to winter weather, seasonal illness, the seasonal nature of our agriculture industry and constraints placed on storage facilities due to the festive period.

The Chief Economist to the Scottish Government has set out the risk associated with a 'no deal' Brexit: a reduction of up to 7% in Scottish GDP and the loss of 100,000 jobs. This analysis is consistent with those of various third party organisations such as the Bank of England, the International Monetary Fund and the Office for Budget Responsibility.

There could be a reduction in food choice and price rises, along with disruption to the movement of other essentials, including medical supplies, and traded goods. There could be shocks to the economy and the labour market. There could be a disproportionate impact on the most vulnerable in our communities. There could be significant disruption for Scots living in the EU as a result of changes to free movement policy and concern among non-UK EU citizens living in Scotland.

Therefore, out of necessity and not choice, we are continuing to plan and prepare for a 'no deal' Brexit on 31 October.

While much of the responsibility for addressing the impact of a 'no deal' Brexit lies with the UK Government, we, and our public sector partners, have undertaken significant work and contingency planning for the effects of a hard Brexit right across our economy and public services. We are taking a range of actions including:

• taking steps to minimise disruption to supplies of food and medicines, should there be problems at key ports and our transport and logistics networks suffer disruption
• providing bespoke online information and support on areas of concern to the public, such as the rights of EU citizens after exit and how businesses can prepare themselves
• ensuring that over 150 legislative instruments are put in place to make sure that the statute book is ready if we leave without a deal
• working with Scotland's business organisations to provide appropriate information, advice and support to help them manage the business and economic implications of leaving the EU
• paying farmers and crofters 95% of their Common Agricultural Policy entitlement through a loan scheme by the start of October to support them if Brexit takes place on 31 October

We will continue to push the UK Government for action, clarity and information in the event of a 'no deal' Brexit. The UK Government must:

• share the information we need on delays and other issues at the border
• confirm whether arrangements will be in place that avoid additional tariff or non-tariff barriers on exports of food and drink produce with priority countries
• share data on the continuity of supply of medical supplies and radioisotopes and make sure that regulatory frameworks are in place for their continued supply
• take action to minimise as far as possible the worst impacts of an economic shock
• support households to manage an increase in the cost of living and prevent more people from falling into poverty, including making changes to Universal Credit, lifting the benefits freeze on working age benefits and uprating benefits in line with inflation
• allow a tailored approach for Scotland within the UK immigration system, engage with EU Member States on the rights of UK citizens living in the EU and guarantee the rights of EU citizens living in Scotland
• take account of our separate criminal justice system when planning for the loss of access to key EU security and law enforcement tools, share information with the Scottish Government and our operational partners on contingency plans, proposed mitigations and developments and make sure Scotland is fully involved in decision-making and planning for maritime security issues
• meet the costs related to EU exit, including additional costs for policing, provide full financial compensation for the consequences of EU exit and commit to fully replace EU structural funds, recognising Scotland's right to determine its own priorities

Keeping pace

Remaining aligned with EU law will be an important signal to our European partners of our ongoing commitment to co-operation in the future. It will demonstrate that we will not accept any regression of protections and it will smooth the path for Scotland to re-join the EU.

Last year the Scottish Parliament passed the UK Withdrawal from the European Union (Legal Continuity) Bill. That Bill was designed to protect our system of laws from the damaging consequences of EU exit. After the Scottish Parliament agreed to the Bill, the UK Parliament passed its own Bill – now the UK EU (Withdrawal) Act – which retrospectively constrained the power of the Scottish Parliament to prepare devolved laws for Brexit, despite an explicit refusal by Holyrood to give its consent to this legislation.

The Scottish Government has decided to introduce a Continuity Bill to allow the Scottish Parliament to 'keep pace' with EU law in devolved areas if Brexit occurs.

We are also clear that EU exit must not impede our ability to maintain high environmental standards. We will develop proposals to ensure that we maintain the role of environmental principles and effective and proportionate environmental governance and any legislative measures required will be taken forward in the Continuity Bill. In the event of 'no deal', we will put in place interim, non-legislative measures while continuing to develop longer‑term solutions.

We will seek to change the way intergovernmental relations are conducted in the UK, on the basis of equality between the Governments of the UK and, where it is in Scotland's interests, we will agree UK-wide frameworks in particular policy areas previously subject to EU law.

Citizens' Assembly

As part of our response to Brexit and the unprecedented position Scotland finds itself in, we have also established an independent Citizens' Assembly.

Citizens' Assemblies are often used to help societies discuss significant constitutional or social issues in a respectful, non-partisan manner based on evidence and reasoned debate.

The Assembly, which will comprise up to 130 members of the public and is run independently of government by two co-convenors, builds on our work to promote participatory democracy and open government.

The Citizens' Assembly of Scotland will consider three broad questions:

• What kind of country are we seeking to build?
• How can we best overcome the challenges Scotland and the world face in the 21st century, including those arising from Brexit?
• What further work should be carried out to give us the information we need to make informed choices about the future of the country?

The Assembly is expected to conclude its deliberations in April 2020 and the Scottish Government will respond to the recommendations of the Assembly within three months.

Scotland's future

The last three years of Brexit negotiations and actions, such as the passage of legislation to constrain Holyrood's powers, illustrate that Westminster often acts against Scotland's interests and wishes.

The democratic Scottish Government believes decisions about Scotland's future should be made by the people of Scotland.

So as well as measures to limit the damaging consequences of decisions that have been imposed upon us, it is more important than ever to set out what could be achieved if we took decisions ourselves as an independent country and to ensure people can exercise their democratic right to choose independence.

The government has a clear democratic mandate, won in the 2016 Holyrood election, to offer the choice on independence in this Parliament and we intend to do so. A majority of MSPs support an independence referendum within this Parliament.

The Scottish Government produced a comprehensive plan for an independent Scotland in 2014. The Government will now undertake the necessary work to update that plan and ensure that people have the information they need to make informed choices over the future of the country.

We have also introduced the Referendums Bill which sets out the way future referendums will be run and will provide clarity about the process for voters, campaign participants and those administering the referendum process. We will seek agreement to a transfer of power during the passage of the Bill to enable an independence referendum that is beyond challenge to be held. It would be contrary to basic democratic principles for the UK Government to attempt to block such a referendum.