Financial News

  • 28 February 2014, 9:30

Standard Life May Quit Independent Scotland

The financial giant Standard Life is making contingency plans to pull out of Scotland in the event of a vote for independence.

Just hours after the Edinburgh-based company intervened in the debate on Scotland's future, the credit rating agency Standard and Poor's (S&P) weighed in too with a warning that an independent Scotland would face "signficant challenges."

S&Psuggested the economy of an independent Scotland "could be subject to volatility" and would face "comparatively high public debt" but the potential barriers would not be unsurpassable.

Standard Life said that post-referendum uncertainties have already prompted it to establish companies outside of Scotland to where it could transfer parts of its operation.

In its annual report, the firm cites a number of "material issues" which give rise to uncertainty:

::The currency that an independent Scotland would use.

::Whether agreement and ratification of an independent Scotland's membership to the European Union would be achieved by the target date (currently March 24, 2016).

::The shape and role of the monetary system.

::The arrangements for financial services regulation and consumer protection in an independent Scotland.

::The approach to individual taxation, especially around savings and pensions, as a consequence of any constitutional change.

Publishing its annual report, Standard Life Chairman Gerry Grimstone said: "Scotland has been a good place from which to run our business and to compete around the world.

"We very much hope that this can continue. But if anything were to threaten this, we will take whatever action we consider necessary - including transferring parts of our operations from Scotland - in order to ensure continuity and to protect the interests of our stakeholders.

"We will continue to seek further clarity from politicians on both sides of the debate, so that we can reach an informed view on what constitutional change may mean for our customers, our business and our shareholders."

Standard Life has 5,000 Scottish-based employees. It has been based in Scotland for 189 years.

The intervention of such a big financial beast into the referendum debate is extremely significant and harmful to the campaign for Scottish independence.

Blair Jenkins, chief executive of the pro-independence campaign Yes Scotland, said: "Standard Life wants to see agreements on currency, regulation and taxation, which is exactly what the Scottish Government has proposed.

"Standard Life wants a formal currency union and so do we. The only threat to that comes from the refusal of the No campaign and the UK Government to get involved in sensible discussions."

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