But It’s Reserved!

“When you have no real power, go public — really public. The public is where the real power is.” – Elizabeth Warren

The nature of Scotland’s devolved settlement is that the country is simultaneously less powerful than many would like but more powerful than many would give it credit. The reserved powers list in Schedule 5 of the Scotland Act are quite clear and the Scottish Government can and has been taken to court when it has attempted to overreach its powers. However the areas of devolved powers are broad and cross-cutting enough that it is often possible to effect change in defiance of Westminster simply by looking for the cracks and loopholes within those reserved and devolved powers.

We have also seen the pandemic reveal that some powers (such as the power to close or restrict borders) which were previously assumed to be reserved have, in fact, been substantially devolved. Until the pandemic struck it would have been considered unthinkable that the Scottish Government could effectively order the closure of the Anglo-Scottish border – and yet, for a time, it was (that the closure wasn’t particularly well policed and enforced is another matter entirely).

Scotland pushed against reserved Westminster policy many times – mostly significantly by using powers over planning permission to effectively block nuclear power and onshore fracking in Scotland. A larger challenge looms in the form of offshore oil and gas, but I believe that the Scottish Government could go further that it current does in terms of opposing oil extraction around Scotland despite the powers to do so being largely reserved.

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(Source: Unsplash)

The oil and gas sector remains a huge sticking point in Scotland’s attempts to become at least a Net Zero nation 2045 – never mind attempts to implement the much grander strategy of a Green New Deal. I’m extremely sensitive to the needs of a Just Transition for those working in the sector – previous “transitions” in Scotland led to thousands of workers in the coal and heavy industries and entire communities left destitute and deprived even to the present day.

However, it is fairly obvious that even the most limited Net Zero plan will result in the oil and gas sector losing the vast majority of its customers which will have profound impacts for the structure of the sector (never mind the profits of the shareholders at the top of it). This is why they are lobbying Governments around the world extremely hard to try to find ways of greenwashing their activities and to build their Net Zero plans around schemes that boost demand for oil and gas as much as possible. This may well explain why the Scottish Government’s new draft hydrogen plan is based around what they now call “low-carbon hydrogen” – that is, methane (derived from natural gas) reformed into hydrogen and carbon dioxide, with the CO2 “captured and stored” using as yet unproven technologies. There is no phase out timeline for this “low-carbon hydrogen” in favour of truly “green” hydrogen (which is mentioned only as a parallel rather than displacement development) which effectively implies that the Scottish Government intends to extract and use natural gas indefinitely for the foreseeable future (and perhaps explains the fury emanating from them just prior when Westminster decided to not fund a carbon capture pilot scheme in Scotland).

This is what makes the Scottish Government’s approach to the Cambo field so controversial. It first hit the public eye when First Minister Nicola Sturgeon was asked directly by climate activists if she would oppose the field. Headlines were generated when her reply was less than unequivocal.

Since this, others have applied the same pressure. This week, Labour MSP Monica Lennon received a reply from Government Energy Minister Michael Matheson to her call three months ago for the Scottish Government to work towards the end of oil and gas.

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This reply revealed the deepening and widening divide between the Scottish Government and Westminster on climate action but also showed that the Scottish Government themselves are still reluctant to outright condemn and resist new oil developments – saying only that their support was contingent on the new field passing a “very stringent and robust climate assessment”.

But we know that the science around oil’s role in climate change means that if the world wants to stand any hope of meeting its commitments to averting disaster then no new oil and gas fields can be opened anywhere. This includes the Cambo field near Shetland. Assuming the Scottish Government accepts this basic science then what they’re effectively saying is that “we’ll support this only if it passes an impossible test” which is close to, but also in political terms quite far away from saying “we will not support this”. Especially when the “stringent and robust climate assessment” hasn’t itself been published.

As previously stated, this is a reserved area so it seems unlikely that the Scottish Government could outright ban the Cambo field but this is also quite far away from saying that the Scottish Government is powerless. If they had the will to, there are actions that could be used to make it as difficult as possible for the UK to keep on drilling.

Planning Permission

Offshore developments are reserved but it is unlikely that the Cambo development would take place entirely offshore. If it involves onshore developments that fall within the remit of the Scottish Government then it may be possible for them to be blocked in a manner similar to the way that nuclear power and fracking have been. Not strictly banned – but no development will ever be given the planning permission required to build them legally. This kind of block might be applied to onshore oil infrastructure (possibly pipelines, or storage/processing facilities), it could affect administrative buildings (or housing for critical onsite staff) or it might even just affect public infrastructure required to run the site efficiently (such as access roads).

I don’t know where the limits of this tactic might be – particularly with regards to Cambo specifically – but I would be very interested to hear from anyone who has looked into this in more detail.

Devolved Taxes

Direct taxation of oil extraction is reserved, as are the profit taxes on the corporations running the wells, but since 2012 Scotland has quite extensive powers over the creation of new taxes in Scotland. So far these have mostly only been used to replace a previously reserved tax that was removed from Scotland (such as swapping UK Stamp Duty for a Scottish Land and Building Transaction Tax). They could, however, be used to create a new Land Value Tax or…possibly of interest in this case…an environmental tax linked to carbon emissions, or the production or extraction of environmentally hazardous materials. Such a tax would be well within the philosophy of a Circular Economy so could hardly be considered to be against current Scottish Government policy. Such a tax would, of course, affect all polluting companies in Scotland – not just new oil fields – so I can already see an objection on Just Transition grounds but it may be possible to apply a derogation to existing polluters so that they wouldn’t be affected immediately but would have to clean up their act as the derogation is reduced and removed over a defined period. New producers, however, could expect to be affected immediately and if the tax is set at a level that means that the company cannot profitably operate without damaging the planet then…well, the whole point of the climate emergency is the acceptance of the fact that a survivable biosphere is more important than a shareholder’s dividend.

Subsidies and Support

Similar to taxation, the Scottish Government has extensive powers over subsidies and other form of public support. These actions are, by definition, means of reshaping (or more pejoratively, “distorting”) an unbalanced market. The Scottish Government has already tried to use subsidies directly to damaging industries such as giving money to weapons manufacturers to support their non-arms activities. This policy has largely failed (possibly even been counter-productive by simply allowing the companies to divert more of their own money into weapons developments) so I’m not arguing for them to directly pay polluting companies to try to get them to stop polluting. But what if subsidies could be used to disrupt them by supporting their greener competitors? One of the major sticking points of the Just Transition has been the lack of access for oil workers to move into greener jobs. Over 80% of offshore oil workers asked in a recent survey said that they would be willing to transition out of the sector with more than half explicitly saying they’d move into offshore wind or other renewables. This is a sector that is already struggling with skills shortages so it might not take much of a push from the Scottish Government to severely limit new developments like Cambo simply because all of the key staff have already Justly Transitioned.

Protest and Public Objection

As the opening quote goes, if power is lacking – go public. If the Scottish Government finds itself unable or unwilling to take any of the policy steps above or if they prove insufficient in and of themselves to prevent Cambo and other new oil developments then  – assuming the political will is there for Cambo to be stopped – they could encourage, support and even mount a public protest against it. It was encouraging that the First Minister explicitly encouraged protests and activism ahead of the COP26 conference (in stark contrast to Boris Johnson and Priti Patel who are openly advocating for the law to be changed to make it easier for climate protestors to be jailed). They could drop the dithering and equivocal statements seen above and take a much stronger position. The Scottish Government could turn to the public gallery, safe in the knowledge that public support for climate action has never been higher, and speak against Westminster actions. This would necessarily be just the first step in an escalating pressure campaign and would immediately put the Scottish Government into confrontation with Westminster over the issue but, as Monica Lennon’s letter revealed, it’s not as if they’re cooperating at the moment.

Won’t Westminster Stop Us?

When I’ve had this conversation with folk, the second question that is often asked is to wonder if Westminster will either overrule the Scottish Government (under the current interpretation of the Sewel Convention, Westminster can operate without devolved permission in any are of policy and merely promises to “not normally” do so. “normal times” being, of course, those times when it chooses to not override Scottish devolution) or could simply claw powers back from the Scottish Parliament to prevent them being used (the Scotland Act being itself an act of Westminster and its modification being itself a reserved issue). Both of these things are possible. Indeed, this is possible in every policy, at any time. To use this excuse to avoid doing something under the hypothetical threat of reprisal is to say that all devolved power is pointless because Westminster might overrule it. The threat is only real if Johnson et al actually make it. And it is only possible if they think they can get away with it. The point about the escalating pressure campaign linked above is that we should use our political power to ensure that the political cost of reprisal is higher than the political cost of his acquiescence. Make it easier for Johnson to agree with us than to not and he will. If we don’t, he won’t.

Conclusion

I’m not saying that Scotland has nearly enough power under the current devolution framework and that we don’t need independence to make good with our climate ambition. We do absolutely face hard limits that will block our Green New Deal unless we become independent within the next few years. However we cannot simply look at that framework and use it as an aegis against our responsibilities to the country and to the planet. We cannot simply throw up our arms, shout “It’s reserved” and expect that it absolves us from doing anything at all even if it means locking away the best or easiest options.

Quite frankly, I don’t think the Scottish Government has any intention to actively try to block the Cambo field unless the political cost to them to do so is higher than to not do it (pressure campaigns don’t just work at UK level). I believe that that is the real reason – not lack of devolved power – that they’ve been so equivocal on the issue. That and the fact that its not just environmentalists trying to lobby the Government.

If the Scottish Government really wants to stop Cambo then ultimately, where there is a will, there is a way. Discovering if there is might be the first place to start.

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2 thoughts on “But It’s Reserved!

  1. Try loading Nor th Sea Oil towards Scotland when even the most ardent First Minister’s advisers are all Whitehall civil servants, with no allegience to the SNP, and every intention of stopping or diverting self-governance. Once they smeared the most feared opponent, Alex Salmond, they secured the upper hand.

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