Wales needs its own Plan B

The panic may be necessary, but panic it is. With polls saying the Scottish referendum is too close to call, in the next few days Scotland will be offered, constitutionally, something just short of the earth, while markets and big industries will apply the economic frighteners.

Meanwhile the Queen will be wondering whether her reign will be known not for its longevity but for being the last over an united kingdom, and whether the annual trip to Balmoral will henceforth be a trip abroad.

How did we get to this precipice?

It is easy to blame poor tactics on the part of the present UK government, but it is more deep-rooted than that. History and the asymmetry of the United Kingdom makes it inherently difficult for Whitehall to heed consistently, even the periphery of England itself. A centralising mindset, almost unmatched in Europe, has survived devolution to Scotland and Wales.

Centralisation of government and business, the emasculation of local government, the primacy of finance, the neglect of the productive economy, the excessive lauding of the market, the undermining of social solidarity have all made their contribution. Margaret Thatcher had no Plan B for the coal-mining communities.

But what will be the consequences if Scotland does not resist the urge to push us all over the edge? There is much general talk to the effect that there will be change, whatever Scotland decides. No doubt, but a Yes vote will not produce the same kind of change as a No vote. And it might not be as benign.

A bare majority for No could well force the kind of full-scale constitutional reassessment of the governance of the UK that is decades overdue. The First Minister of Wales, Carwyn Jones, has been campaigning for a UK Constitutional Convention to do just that for at least 18 months, unfortunately with precious little response until now.

I say ‘could’ because the British penchant for muddling through on constitutional matters is very deep-seated. That is why we still have the absurdity of hereditary peers in the House of Lords . But Britain has now run out of excuses.

The consequences of a Yes vote are of a different order, and far less predictable. It is difficult to overestimate the impact of Scottish secession from the union. Yes, we can have fun contemplating a name for the rump UK – Little Britain or, more controversially, England. Don’t laugh, the elephant next door would comprise 92 per cent of the population.

We can amuse ourselves re-designing the Union Jack to remove the Scottish saltire and insert a dragon or the cross of St David. We can debate whether a Yes vote would require David Cameron’s resignation, or whether Boris Johnson might become the first Prime Minister of ‘England plus’ on the basis that he might provide England with a psychological pick me up.

But beneath all this would be the reality that the loss of Scotland would be more traumatic for England – and particularly for the political, financial and cultural elites of the south east – than the loss of the British empire. We cannot know what the psychological effect of such an amputation will be.

There is a common, but false assumption that the United Kingdom has endured for all time. Wales was annexed in the 16th century, the crowns of England and Scotland came together under the Stuarts at the beginning of the 17th century, union with Scotland followed at the start of the 18th century and union with Ireland in the 19th century.

The loss of empire was swifter, but took the best part of a century. Irish Home rule was debated and fought for from the 1870s to 1921. In 1931 the Statute of Westminster declared that colonial legislatures were no longer subservient to the Imperial Parliament. India won its independence in 1947, 90 years after the first Indian mutiny. In 1956 the Suez crisis exposed our lingering imperial pretensions. And four years later Harold Macmillan reminded an audience in South Africa of the ‘winds of change’ blowing through the continent.

Importantly, as the empire ebbed away the power elites were able to suck on two comfort blankets: first, the fact of having been the victor in 1945; second, membership of what was then a very small nuclear club. The UK’s status was not dependent on land mass, population, natural resources or finance. After all, at the end of the war we were broke.

Scottish secession would be a different matter. In historical terms it would have come remarkably swiftly, and the comfort blankets are threadbare. 1945 is now too far away, the world’s nuclear club is bigger, and our nuclear deterrent seems less relevant to modern circumstances.

On the other hand, population and economic performance are now a significant determinant of our relationship with Europe. They help determine our financial contribution and rebate, and our influence over allocation of portfolios in the Commission. The UK’s population determines the number of our seats in the European Parliament. Our military capacity affects our standing in NATO and the UN, as well as our relationship with the United States.

All these would be affected by Scottish secession. It will not be possible – as it was with the loss of empire – for the power elites to go on pretending that nothing had changed. England (and London in particular) would feel this diminishment far more than Wales. The effects of trauma are not always predictable, and recent polling on English attitudes provide no comfort.

Wales would face some perils of its own. With Scotland gone, we might find it easier to get a better overall funding deal through reform of the Barnett formula. But other consequences might be harsher and more unpredictable. For instance, although Scotland would no longer be part of UKTI’s inward investment team, it would be fighting its own corner – like Ireland – with a sharply reduced corporation tax.

Toughest of all would be that Wales would be faced with the harsh reality of its own lack of leverage. The threat of independence for Wales has no current credibility. We do not have oil. Neither do we have – like Northern Ireland – a border with another state that has a claim on us.

Faced with this situation, over the last half century we have been very adept at using Scotland as the battering ram, and following in its wake – what one BBC colleague called ‘kiltstreaming’. That option would be gone. The only leverage that we could build would have to be on the foundation of superior performance which, regrettably, still seems a long way off.

We have a fair idea of what Wales might want out of a new UK settlement in the event of a Scottish no vote. There are no signs yet that we have a Welsh contingency plan in the event of a Yes vote. We need one urgently.