It’s not part of the UK and is actually nearer to France. But could Guernsey be the key to Scotland’s future?
Feelings are running high in the run-up to Scotland’s independence referendum on whether it wants to leave the UK.
“Effectively independent”, yet using the pound
George Osborne, the British chancellor, has turned up the heat by ruling out a currency union with an independent Scotland – in other words, he says it would not be able to share the pound with the remaining UK.
But Guernsey happily uses the pound, despite not being part of the UK. It also issues its own sterling bank notes and coins, which have equal value to the British pound. It’s the same situation on the other Channel Islands.
Mr Osborne doesn’t appear to have done anything to bring what some might argue is really a currency union to an end.
On top of that, the government of Guernsey proudly states that it is “effectively independent” from the UK government.
Guernsey is also, of course, famous for its low tax and as a financial centre. A recent assessment found that tens of billions of pounds of deposits are held in Guernsey banks. On top of that hundreds of billions are in funds under management and administration in Guernsey.
The island is also plugged into the European Union market to some degree. That’s despite Guernsey neither being a separate member state or an associate member of the EU.
It is also part of a common travel area with the UK, meaning passports do not have to be shown on “domestic” flights, for example, although photographic ID does.
Scotland: a new crown dependency?
It’s all down to Guernsey and the Channel Islands holding the status of crown dependencies. They are loyal to the British crown, but are self-governing.
Originally, they were part of the Duchy of Normandy from before the Norman conquest of England. But they were retained by the Kings of England when Normandy was lost in 1204.
Could Scotland’s future lie with the Channel Islands in it becoming a new crown dependency? Self-governing with the ability to set its own laws and happily using the pound, while keeping the Queen as the head of state, while avoiding the headache of border crossings?
The issue of sovereignty
Of course, there are some matters to consider. The first is that Guernsey is not a sovereign state and comes under the “protective wing” of the UK government.
Westminster is responsible for the bailiwick’s international representation and defence – although has acted internationally more on its own in recent years.
But the UK government is also a lot bigger and powerful than Guernsey. And the two sides’ views don’t always coincide. Tax avoidance has been an issue for example.
In using the pound, the UK also sets monetary policy.
Guernsey is also not ultimately responsible for defence or international policy – although the UK’s sovereignty in this areas is itself tied into its membership of Nato, the EU and even the UN.
Guernsey and the Channel Islands are also small communities, dwarfed by Scotland’s population.
There is also around 70 miles of the English channel between the UK and Guernsey rather than a land border.
Could the crown dependency model be scaled up to work? And it might not satisfy nationalists who want Scotland to be a sovereign state. But might others be satisfied with this option to devolve maximum power to make Scotland “effectively independent”?
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