Scotland voted to stay in the U.K. in a referendum on independence, stepping back from a breakup of the 307-year-old union while wringing promises of more financial power from Prime Minister David Cameron.
After a count through the night, 55.3 percent of Scottish voters supported the “no” campaign against 44.7 percent who backed independence. U.K. shares helped lead European equities to a 6 1/2-year high and the pound rose to the strongest level in two years against the euro after the Better Together campaign posted a wider margin of victory than opinion polls suggested. There was a record turnout of more than 90 percent in some of the 32 districts.
The Scottish Independence Vote: Breakdown of Results
“I accept the verdict” of the people, Alex Salmond, the leader of Scotland’s semi-autonomous government in Edinburgh, said in a speech. While conceding defeat, he stressed the broad movement that resulted in 1.6 million votes for independence. “The unionist parties made vows and Scotland will expect them to be delivered in rapid course,” he said.
The referendum outcome follows two years of increasingly bitter arguments over the economic viability of independence, the currency to be used, custody of the health service and North Sea oil revenue, leaving a legacy of a divided Scotland while inspiring self-determination movements across Europe.
The FTSE 100 Index added 0.7 percent in London, and the Stoxx Europe 600 Index rose 0.6 percent. The pound gained as much as 0.9 percent versus the euro and traded 0.4 percent higher at 78.52 pence at 12:09 p.m. in London.
The benchmark 10-year U.K. government bond yield fell 1 basis point to 2.57 percent. The two-year gilt yield rose 3 basis points to 0.89 percent as investors bet the decision to reject independence clears the way for the Bank of England to raise interest rates as early as the spring.
Cameron said he would stick with his promise to cede more policy-making powers for Scotland after a “no” vote. He also pledged a constitutional shakeup of the U.K. that would take into account how England and Wales are governed.
Scotland's Vote for Independence
Outside his Downing Street office in London, Cameron said the Scottish people had spoken and “we hear you.” “We will ensure those commitments are honored in full,” he said.
The closeness of the contest before the vote, which saw one poll this month put the “yes” camp ahead, unnerved financial markets and triggered a last-ditch attempt by Better Together to persuade voters that “no” would herald some of the changes Scots say they want.
The prime minister and opposition Labour Party leader Ed Miliband canceled parliamentary business and headed north a week before the vote to campaign in cities and towns across Scotland. They pledged more powers to the Scottish Parliament over taxation and welfare spending in an attempt to arrest momentum in the polls for Salmond after he outshone Better Together campaign leader Alistair Darling in a televised debate.
Darling, a former Labour chancellor of the exchequer, used his victory speech to hail the vote for “positive change rather than needless separation.” Cameron called Darling this morning to congratulate him on his successful campaign.
“They need to get their skates on and deliver,” Matt Qvortrup, senior researcher at Cranfield University and author of “Referendums and Ethnic Conflict,” said of the main U.K. parties -- Cameron’s Conservatives, his Liberal Democrat coalition partners and Labour. “They should have done this earlier.”
As the results unfolded, early bellwethers suggested a let-off for Cameron and Miliband. In the end, only four local authorities -- Dundee, West Dunbartonshire, North Lanarkshire and Glasgow, Scotland’s biggest city -- voted “yes.”
Emily Gallagher, an 18-year-old student and “yes” supporter, said she was “devastated” by the result.
“We had a great opportunity and we blew it,” she said over the din of pro-independence chants in central Glasgow. “We’ve had so many Tory governments we’ve never voted for and that’s just going to go on.”
That the referendum took place at all reflected the gulf between politics in Scotland, where Salmond’s SNP has run the devolved administration since 2007, and the rest of the U.K., where Cameron’s Conservatives have the support of just one Tory lawmaker from Scotland.
The situation was exacerbated by the weakening of Labour, traditionally a dominant force in Scotland. The party lost to Cameron in the 2010 election to the U.K. Parliament at Westminster before being trounced by the SNP in Scotland a year later. That win for the nationalists paved the way for the vote on establishing Europe’s newest sovereign state.
Cameron and Salmond signed the Edinburgh Agreement that set out the terms of the referendum in October 2012 with both promising to uphold the result.
The campaigns became increasingly heated and culminated this week in both sides appealing to the emotional side of voters. In the event, it appeared that more of the undecided respondents in opinion polls opted for the status quo.
“This was an event that cannot be captured or understood just by looking at the percentages,” said Harris Mylonas, assistant professor of political science at George Washington University and author of “The Politics of Nation-Building.”