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Can Lord Smith unite a divided nation?

  • Both sides feel betrayed by their fellow Scots
  • Top business leader’s diplomatic skills will be put to the test

Before Thursday’s referendum both sides said they would accept the result. On Thursday the people delivered their verdict. And all hell let loose.

Not only have there been confrontations in the centre of Glasgow, but new verbal battles have broken out among and within the political parties. Despite Thursday’s result there is no settled will, no sense that the referendum has put the independence issue to bed. The SNP itself is divided. It has seen a surge in membership, but at least one poll suggests many of its members want it to drop the independence campaign. Hardliners are rallying behind a new ’45 uprising inspired not by the calendar year but by the percentage of those who voted Yes and want another chance at achieving Alex Salmond’s dream.

Against this volatile backdrop Lord Smith of Kelvin will try to bring order and purpose to parliamentary affairs after being appointed by Prime Minister David Cameron to oversee the process of introducing new powers to Scotland. One of Scotland’s highest achieving business leaders, Lord (Robert) Smith had a good Commonwealth Games, as chairman of the organising committee, and has a track record that includes a long career in investment banking and private equity. He chairs the Green Investment Bank.

The task of overseeing the commitment to more devolved powers to Scotland is a big ask in a tight timetable. Draft legislation is due by January, but he is unlikely to have accepted the role if he did not think this was achievable. His chairmanships of two Scottish FTSE 100 companies (Scottish & Southern Energy and formerly Weir Group) give him a unique status among his peers. His style is quiet diplomacy and an ability to get the best out of people. He will need both in spades in the months ahead.

The challenges for all those charged with creating a new constitutional settlement are many, but the first is understanding what Thursday’s result really meant.

Scotland has both gained and lost something from the referendum. It gained, or least reaffirmed, a collective sense of its own identity either within or outwith the union and did something to restore the balance between the people and those who represent them.

What it lost is something equally powerful. While the Scots identity was galvanised by the campaigning on both sides, the divisions that were created have been deep and damaging. Both sides feel betrayed by their fellow Scots. For the Yes voters it was the No camp’s lack of belief in the Scottish people’s ability to do things for themselves; for those who said No there was a view that their opponents were being unfaithful to a union that has served them well for 300 years.

Power, for now, returns to Westminster and to those in whose hands the next phase of Scotland’s future will be determined. There are concerns that the referendum will quickly become yesterday’s news as attention turns to the 2015 general election and “other matters”. So, Scotland’s independence lobby waits impatiently, like a wounded army, to hear if the offers of peace and justice will be forthcoming or whether they will be forced to reawaken Westminster and fight again.

Will the “losers” in Thursdays vote ever be truly satisfied with what the party leaders in London can offer? The promised new powers for Scotland, in addition to those already being introduced next April, will mainly concern income tax and social security. Almost certainly this will not be enough, at least for the hardliners. What is on the table is not even Devo Max. It is Devo More. Some might say Devo More of the same.

For now, there is at least an opportunity to take stock. The financial markets were satisfied that predictions of a No vote proved correct and the pound rose. The sighs of relief from the Bank of England and boardrooms around the country were almost audible. Estate agents already report brisk business as buyers and sellers feel assured by the decision. Businesses were relieved at the removal of great uncertainties and cost implications, especially over currency and regulation.

But they cannot be so complacent about the future. Those holding the economic levers better not let go as the restoration of stability may prove temporary. There have been many pledges from Scottish business organisations to work with the politicians to create a new constitutional agreement. They will have their work cut out as they will have to fight their corner alongside lobby groups from south of the border. As I predicted last week, the English regions will not settle for any deal that is perceived as giving Scotland an advantage. This has the potential to stoke discontent throughout the kingdom.

The dilemma for the politicians and their appointees is that they must move quickly without acting in haste. It will require some early and meaningful actions which are sound enough to convince a larger majority of Scots that they have reached a destination where they want to stay and where they can happily cohabit. The squabbling that has broken out since the referendum suggests it will be a long journey. It is for Lord Smith and those working alongside him to ensure that it is not a troubled one.

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