The ‘Imperial burden’ Hypocrisy

This is the fourth in a series of occasional articles looking at aspects of Irish history – and drawing out some implications for present day Scotland: (See SLR 35, 40 and 46 for previous articles). This note is prompted by a letter written on 10 November 1921 from the then UK Prime Minister, Lloyd George, to Sir James Craig, whom Lloyd George addressed as the “Prime Minister of Northern Ireland”.  As will be shown here, this letter neatly illustrates the continuing hypocrisy of the UK establishment in relation to its colonial territories.

This letter was sent at a critical stage in the negotiations between the Westminster government and Southern Ireland, leading up to the Anglo Irish treaty.  The treaty was, in the event, signed less than a month later, on 6 December. “The time has arrived”, the letter began, “when formal consultation between His Majesty’s Government and the Government of Northern Ireland is necessary for the further progress of the Irish negotiations.”

The letter then set out the outline of the settlement towards which the Westminster government was working. Ireland would become a self governing dominion within the British Empire. This new dominion would comprise the whole of Ireland, North and South, under an all-Ireland Parliament. Below this level, there would be separate governments of the North and South, each exercising the powers envisaged under the Government of Ireland Act 1920. So the North would have been responsible for its own domestic affairs: that is, for policies other than defence, foreign affairs, international trade and currency. But crucially, the North would no longer be part of the UK.

According to the latest GERS publication, the defence spend allocated to Scotland in GERS amounts to 2.75 per cent of Scotland’s non-oil GDP: whereas defence expenditure for the UK as a whole is 2.6 per cent of GDP.

The letter then went on to the serious business of pressurising the North to accept these arrangements. Two main arguments were deployed. The first pointed out the impracticality of administering customs barriers over the jagged boundary between North and South, if the North remained part of the UK, and the South became independent.

The second argument was a financial carrot. If the South became a dominion, it would escape the necessity of paying a share of the cost of defending the Empire. By contrast, if the North stayed with the UK it would be burdened with these costs. “..if … Northern Ireland remained a part of the United Kingdom with the essential corollary of representation in the Imperial Parliament, it is clear that the people of Northern Ireland would have to bear their proportionate share of all Imperial burdens, such as the Army, Navy, and other Imperial services, in common with the taxpayers of the United Kingdom. The Members for Northern Ireland at Westminster would otherwise be voting for policies in Parliament, the expense of which they would not share. It would be inevitable, if Northern Ireland were to remain a part of the United Kingdom, for Belfast to bear the same burdens as Liverpool, Glasgow or London.”

Lloyd George’s letter is, naturally, marked ‘Secret’, though he later made public the text of his exchanges with Craig. (The full text of the 10 November letter can be accessed at One source of the letter is the Mulcahy papers in University College, Dublin. It would originally have been part of Michael Collins’ papers, as one of the key Southern negotiators in the treaty negotiations. Richard Mulcahy inherited Michael Collins’ papers when he took over as head of the Irish Army on Collins’ death.

Was this a serious attempt by Lloyd George to pressure Ulster to leave the UK and become part of an independent Ireland? Who knows. According to William O’Brien, Lloyd George had made a secret promise to the South that, if they signed the treaty, partition of Ireland would not happen (see SLR35). But whether this was a sincere promise to the South, or a cynical negotiating ploy, is unclear. Similarly, it is not clear if Lloyd George’s letter to Craig was merely an attempt to convince the Southern negotiators that he was going along with his side of the promise: or if the letter did indeed mean what it said. The likelihood is that Lloyd George was actually being pragmatic, by keeping the South in play, while indicating to the North that British patience was not inexhaustible. Given Lloyd George’s character, he would have been prepared to react flexibly, whichever way the cards fell.

What is clear is that the letter was a supreme exercise in hypocrisy. Either it was an attempt to delude the South into believing that partition would not in fact happen. or it was a sell out of the North. Our primary interest, however, is what the letter tells us which might be of relevance to the present situation in Scotland: and the letter does indeed point up two very important implications.

First of all, the letter is a reminder of just how volatile UK government policy can actually be, even on matters which are presented as deep issues of principal. All governments, of course, have to present their current policies as if this is the only possible course of action, to which they are unalterably committed. As a rule of thumb, the shakier the basis of the policy, the firmer the statements of commitment: this is the well known football manager syndrome. This should not, however, blind us to the potential for sudden policy switches. And just as the UK policy on the partition of Ireland was swinging through 180 degrees in the early 1920s, it is also quite possible that a Westminster government’s rooted objection to Scottish independence could suddenly change. There are, in particular, two powerful forces which could lead important groups in England to see great attractions in Scottish independence.

First of all, it must already becoming clear to the Conservative party that, while they are in many ways the natural party of government in England, they are by now so unpopular in the other countries of the UK that they may never again achieve a clear majority in a UK-wide election. Consider the results of the 2010 general election. In England, the Conservatives won 298 out of 533 seats: that is, 56 per cent of seats, and a clear majority. In the whole of the rest of the UK they only won nine seats (representing less than eight per cent of the seats being contested) so they ended up with 307 out of 650 overall, forcing them into the present unhappy coalition. And the critical single step which would ensure Conservative domination in a Rest of UK parliament would be taking Scotland out of the equation. In 2010, the UK minus Scotland would have returned 306 Conservatives out of 591 seats: a comfortable  enough majority of 52 per cent.

Attempts at Westminster to address the West Lothian question are likely to increase, rather than decrease, the dissatisfaction of English Conservatives. The Commission whose formation was announced in January, to investigate whether Scottish, Welsh and Northern Irish MPs should be barred from voting on laws affecting only England is likely to have precisely this effect. Apart from the difficulty of defining an “England only” law, English Conservatives will rapidly grasp that this will give them powers over domestic issues only – and not even all of these. The big decisions, like currency, tax, the budget, international affairs, and social security, will remain with the full UK parliament. So the really important levers of state are likely to remain permanently beyond the grasp of the Conservatives on their own.

The second important constituency which could come to see substantial benefits from Scottish independence are the English eurosceptics. The debate on the EU implications of Scottish independence too often focuses on the position of Scotland after independence, and particularly on the legal question of whether Scotland would have automatic successor rights in the EU. But this particular debate misses another very important issue – namely, what would happen to the rest of the UK? Nor is this primarily a legal issue: despite the apparent legal formalism of so many EU issues, what really matters is the practical politics of the situation. And in this respect it is quite clear that, whatever the legal niceties, the rest of the UK would in effect have to re-negotiate its membership of the EU if the UK splits up.

It was essentially this latter point that was made by Patrick Layden, QC, when he gave evidence this May to the Commons Scottish Affairs select committee on Scottish separation. He pointed out that an independent Scotland, together with the rest of the UK, would between them be entitled to more seats in the EU parliament than the number of seats presently held by the UK. This would mean other countries having to give up MEPs. These other countries would then insist on their own terms in the negotiation: the situation would, in practice, be rather like two new countries applying to join the EU.

From an English eurosceptic point of view, this would be a heaven-sent opportunity. In any negotiation, the terms imposed on the rest of the UK would almost certainly be stiff (loss of rebate?; forced membership of the Euro?; financial transaction tax?) and likely to be unacceptable in an inevitable referendum. So the effect of Scottish independence would be to give eurosceptics in the rest of the UK exactly what they want, namely rest of UK exit from the EU. When this penny drops, another important constituency is likely to be added to the list of those pushing for Scottish independence.

So two important constituencies, Conservatives and euro sceptics, are likely to come to recognise that Scottish independence is in line with their own vital interests. The fact that these constituencies largely overlap will only strengthen the effect. Given this, it would be rash to bet that a radical change in Westminster policy on Scottish independence is impossible.

The other intriguing implication of the Lloyd George letter is what it tells us about one of the main arguments currently used by unionists against Scottish independence. As noted above, the second argument used by Lloyd George to pressurise the North to leave the UK was the “imperial burdens” argument. This argument is fascinating in the context of the present unionist stance on Scottish independence, which actually employs the diametric opposite of the Lloyd George argument.

For years, the standard unionist stance against Scottish independence has started with GERS (Government Expenditure and Revenues in Scotland) and has argued that the size of Scotland’s non-oil GERS deficit means that Scotland could not afford to be independent. There are, of course, a number of well-known flaws with this simplistic argument: for example, it ignores oil, it ignores the adverse effects on Scotland’s present economy of membership of the UK currency union and it ignores the potential dynamic effects of independence on Scotland’s economy. But leaving these points aside, what the argument involves is calculating Scotland’s government deficit, where in the expenditure figures allocated to Scotland is a population share of UK expenditure on defence (and also international services). So the current unionist argument involves attributing to Scotland a share of ‘Imperial burdens’ – and argues that, partly because of this share, Scotland could not afford to be independent.

But these ‘Imperial burdens’ allocated to Scotland under the standard GERS approach are actually very significant. The unionists love quoting figures relative to Scotland’s non-oil GDP: so let’s join them in their own game. According to the latest GERS publication, the defence spend allocated to Scotland in GERS amounts to 2.75 per cent of Scotland’s non-oil GDP: whereas defence expenditure for the UK as a whole is 2.6 per cent of GDP. (It is important to remember that this does not mean that what is spent in Scotland on UK defence is 2.75 per cent of Scotland’s GDP. The defence figure in GERS is arrived at by allocating to Scotland a population share of the UK defence spend: it doesn’t mean that the money is actually spent here. This also explains why we are allocated 2.75 per cent, compared to the UK’s 2.6 per cent: our population share relative to the UK is slightly bigger than our non-oil GDP as a percent of UK GDP.)

So as far as the standard unionist argument goes, part of the reason we can’t afford to be independent is that we are assessed to be carrying a defence burden of 2.75 per cent of GDP. As we have seen, this is higher than the UK, (2.6 per cent): but it is also higher than France (2.3 per cent), Germany (1.4 per cent), Italy (1.8 per cent) and Canada (1.4 per cent). In fact, if we look at countries broadly comparable to a newly independent Scotland, we see that Ireland spends 0.6 per cent on defence, New Zealand 1.1 per cent, Denmark 1.4 per cent and Norway 1.6 per cent. (Figures from World Bank.)

And it is not just defence. GERS also assumes we carry our population share of international services (mainly international aid) of 0.6 per cent of GDP. Of course, an independent Scotland may well want to undertake foreign aid. But that would be a decision for the future, once we have our own house in order. It should not be swept up as part of the burden which proves we could not afford to be independent.

The implication is that, implicit in the standard unionist “GERS” argument against independence is the assumption that Scotland shoulders an “Imperial burden” of two per cent or more of GDP. Given that the standard Maastricht criterion for a sustainable deficit is three per cent of GDP, the unionist implicit imperial burden really does stack the cards against independence.

Overall, the Lloyd George letter provides a salutary reminder of the continuing hypocrisy of the UK establishment. The ‘Imperial burdens’ argument that was used to try to coerce the North out of the UK is now reversed, to try to ensure that Scotland stays in. But as the letter also reminds us, UK policy is never set in stone: and the pressures which could well lead important power groups in England to come to favour Scottish independence might bring about some surprising changes in UK policy in the foreseeable future.