Scotland's Place in Europe debate: opening speech by Fiona Hyslop

I move the motion in (Minister for UK Negotiations on Scotland's Place in Europe) Mike Russell's name. I understand the front bench have been advised that he is regrettably unable to attend today.

Almost seven months since the EU referendum in which Scotland voted emphatically to remain in the European Union while England and Wales voted to leave, the Prime Minister has today announced ending UK involvement in the European project in the hardest and most complete way possible. We think this is the wrong decision for the UK as a whole and indicates that the type of country the Conservative wants is one in a race to the bottom, sacrificing consumer, environmental and workers' rights for the price of deregulation and low wages.

But the Scottish Government – and the Scottish people, as indicated in poll after poll – have a different view. We have to find a fresh way forward – a new beginning – that honours the democratic demand of the nation to maintain our relationship with our European friends and neighbours. We are realistic and the proposals we have set out are pragmatic – recognising that the UK is leaving the EU – and a compromise in the Scottish national interest. And it reflects the interests of this Parliament.

This Parliament on 28 June voted 92 to zero to mandate the Scottish Government to 'explore options for protecting Scotland's relationship with the EU, Scotland's place in the single market and the social, employment and economic benefits that come from that'.

And although there was a division, during the debate it was clear that even those who did not support the Government's motion in its entirety were of one mind about certain key issues.

There was, for example, unanimous support for EU nationals in Scotland, and today I welcome the sentiments behind the amendment to the motion for this debate from Ross Greer. I would re-iterate that EU nationals are, and will remain, welcome in Scotland and that their futures should not be used as part of a negotiation strategy by UK Government.

In June there was also agreement about the importance of the single market. For example Ruth Davidson, on behalf of the Scottish Conservatives, tabled an amendment which, she said, 'makes it clear that we want to protect and maximise Scotland's place in Europe the continent and in the European single market'.

Indeed since then Ruth Davidson has gone further.

On June 30 she said: "I think that we need to agree some first principles for the talks. Retaining our place in the single market should be the overriding priority."

And she told the BBC a few days later that she wanted to stay in the single market 'even if a consequence of that is maintaining free movement of labour'.

Kezia Dugdale, on behalf of Scottish Labour, agreed that 'all options for protecting Scotland's place in the single market must be explored'.

Patrick Harvie and Willie Rennie were also among voices from across this Chamber who wished to see the Government explore all of the options open to us within the context of the single market.

Scotland's Place in Europe, published on 20 December last year, delivered that mandate at least in part. It is, moreover, the first detailed plan to be published by any government in any part of the UK to deal with the implications of the UK leaving the European Union.

Today's debate gives us as a Parliament, speaking for our nation, the chance to take those plans a step further. On Thursday the Scottish Government will make a presentation about these plans to the Joint Ministerial Committee on European Negotiations (JMC (EN)), and it is of course proper that this Parliament should give its view of them in advance of that discussion in London. The Prime Minister was explicit today in stressing that this paper is still to be considered by the UK Government.

As the First Minister highlighted to the Chamber on the launch of our publication, these proposals represent a significant compromise on behalf of the Scottish Government and they are put forward in good faith.

We are pleased that this point has been recognised and accepted by so many in Scotland – for example by Professor Sir David Edward, Scottish lawyer and academic and former Judge of the Court of Justice of the European Communities who has said that he "believes that the Scottish Government is right to urge the UK Government to maintain the UK's position within the single market, the Customs Union and the various forms of security and police co-operation. That is the primary proposal and I believe it merits the widest support across the political spectrum."

In developing our paper the Government has listened carefully to many communities across, and outside, Scotland in order that we might understand and respect the wide range of views, including from those who voted to leave the EU.

We have engaged positively in the Joint Ministerial Committee process, as well as in the British–Irish Council and a wide range of bilateral, multilateral and official meetings. We have also worked with the other devolved administrations, with London, Gibraltar and the crown dependencies.

There has also been engagement at diplomatic or governmental level with every one of the remaining 27 member states of the EU as well as an exhaustive range of meetings with think tanks, academics, businesses, representative bodies and individuals in Scotland and in other places too.

Yesterday, I presented our proposals to European partners in Brussels. I held a constructive meeting with the Belgian Vice Prime Minister and Minister of Foreign and European Affairs, Didier Reynders, in which I set out our determination that Scotland will continue to be an open nation, working with our neighbours, and playing a positive role in the world.

I emphasised again that our friendships and partnerships with other nations are important to us and we will ensure that – whatever the outcomes are of the UK leaving the European Union – these partnerships are not damaged.

I also met with Sir Tim Barrow, the UK's new Permanent Representative to the European Union. I outlined our expectation – following commitments made by the Prime Minister, repeated again today – that Scotland will be fully engaged in the process to agree a UK wide approach to Brexit, in advance of the triggering of Article 50.

I am grateful to all those who have offered their views during such meetings and engagements, including those in the Chamber today.

I am also grateful for the Standing Council for its advice and guidance and it input to the development of our paper.

Central to our proposition is the belief that, short of EU membership, full membership of the single market and Customs Union is the best outcome not just for Scotland but for the whole of the UK. That membership can be secured by UK membership of the European Free Trade Agreement and the European Economic Area.

It is disappointing to see that prospect for all of the UK being rejected by the Prime Minster today but we will continue to work with everyone across the political spectrum to take forward the arguments for a differentiated option for Scotland within the UK negotiating position.

We have highlighted possible ways of keeping Scotland in the single market while continuing to protect free trade across the rest of the UK – as well as safeguarding the existing powers of this Parliament and significantly expanding devolution in order to mitigate the damage that will be done by Brexit.

It is difficult to overstate the importance of Scotland's continuing membership of the single market. It is central to both the health of our economy and our prosperity as a nation, enabling Scottish exporters to be inside the world's largest single market, enabling our citizens to buy goods and services free from import taxes and barriers.

The single market has removed barriers to trade and opened Scotland to a market of over 500 million people and 21 million small and medium-sized enterprises.

It is eight times the size of the UK market alone.

Businesses selling in the EU have unrestricted access to these consumers, helping them to stay competitive. As a result, Scotland's exports to the EU are now worth more than £11.6 billion a year, or 42% of the country's total international exports.

Our proposal states that Scotland should follow the UK position on a customs union – if UK is out, Scotland would be out. It is also a market in which considerable potential remains to be unlocked, and new opportunities to increase our trade and co-operation will emerge, new market opportunities will arise – such as in digital economy, services sector, energy, retail, green economy and others.

When the UK becomes poorer as a result of Brexit, particularly if there is a hard Brexit, then taking advantage of this growing European market will become even more important for Scotland.

Membership of the European single market also involves implementing a range of measures designed to further the rights and interests of working people, protect and advance social and environmental interests and address wider societal challenges, such as climate change, by collaborative research and collective action.

While our key proposal is for the UK as a whole to retain membership of the single market and Customs Union, we of course have had to put in place plans and intentions for the situation announced today by the Prime Minister who has chosen to listen to the isolationist Tory Brexiteers and take the path that leads to the hardest of withdrawals.

They want to prioritise cutting immigration and the rejection of the European Court over the financial, employment, social and cultural interests of Scotland.

But more than that.

They are putting the interests of the right wing of the Tory Party over the interests of the people of Scotland.

Our paper explores the ways by which we might secure a differentiated option for Scotland – one which keeps Scotland in the single market by means of continued membership of the European Economic Area.

This strategic objective represents a significant compromise from this Scottish Government. It falls short of what we consider to be the best option for Scotland and the UK which remains full EU membership.

However the Scottish Government is prepared, as the First Minister has made clear, to offer such a compromise in the national interest and in the hope of gaining consensus in Scotland and agreement in the UK to the practical position we have set out.

In this paper we reiterate a position we have held for a long time: that just as UK-wide free movement and free trade could, should, and would continue if Scotland became independent (in the way that the UK government intends that free trade and free movement between the UK and the Republic of Ireland will continue after Brexit), so we are making plans to secure for Scotland, explicitly and sincerely, the benefits of the European single market in addition to – not instead of – free trade and free movement across the UK.

In September David Davis, the UK Secretary of State for Leaving the European Union, went to Dublin and told businesspeople there, 'Ireland will not have to choose between having a strong commitment to the EU or to the UK – it can and should have both'.

As we have seen through its approach to the Nissan deal last October, the UK Government already appears to be open to a flexible Brexit approach in relation to different sectors of the economy. We see no reason why such flexibility should not apply to distinctive geographical areas such as Scotland, particularly if there is no customs barrier.

Of course, our proposal recognises the technical, legal and political complexities and challenges inherent in the entire process of EU withdrawal but it also sets out, in principle, how each of these challenges could be overcome, while confirming that the scale of these challenges will diminish the closer the UK as a whole stays to the single market in its final Brexit deal.

We want our discussions with the UK to succeed. That has been our message in early meetings this year and will be the message that Scottish Government delivers when the paper is formally tabled at the JMC. But of course if our attempts at agreeing a compromise are rejected then it is vital that we continue to have other options available including that of a referendum on independence.

If the right wing of the Tory Party, which is in the ascendency in this debate, can drag Scotland, not only out of the EU, but out of the single market as well, then it will start to believe it can do anything to Scotland and get away with it.

Finally, the paper explains why Scotland must have the necessary powers to protect its five key interests – democratic, economic, solidarity, social protection and influence – on leaving the EU.

EU law is a major source of rights and protections for the people of Scotland. Our constitutional arrangements will therefore need to change to reflect these changed circumstances, whatever the outcome of the Brexit negotiations.

This should include consideration of powers, for example, in relation to immigration and international agreements, to enable Scotland to build its own relationships with Europe and internationally. In the event of a differentiated arrangement for Scotland within the UK, these powers will also be required to maintain our place in the single market and to build such a relationship with the EU from within the UK.

It is important to state that our proposals are aimed, first and foremost, at the UK Government.

Theresa May repeated today that Scotland would be fully engaged in the Brexit process; that options for Scotland would be listened to and that Article 50 would not be triggered until there were UK objectives for negotiations.

We will hold her to her word.

The Scottish Government looks forward to presenting our paper at Thursday's JMC meeting, and to the subsequent discussion with Ministers from the UK Government and other devolved administrations, in the spirit of agreeing a UK-wide approach to leaving the European Union. There is a huge amount of work to do to satisfy the Prime Minister's own requirement for 'a UK approach and objectives for negotiations' before she triggers Article 50 but this paper can help to take the UK to an agreed position if it is used as a basis for progress.

Scotland will not be silenced by a right-wing Tory government which is intent on riding roughshod over our vital national interests and the democratic voice of the Scottish people. It is time to stand up for the interests of Scotland.