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Angus Tulloch speak ups for Scottish independence

Angus Tulloch speak ups for Scottish independence

A group of Scottish financiers, including Angus Tulloch, First State's veteran Asia fund manager (pictured), have accused their trade body of a lack of objectivity ahead of the independence referendum in September.

The businessmen, who also include George Mathewson, former chief executive and chairman of Royal Bank of Scotland, have written to the Financial Times expressing their opposition to the views of Scottish Financial Enterprise.

This follows comments by Owen Kelly, chief executive of the the trade body for Scotland's financial services sector, who last month said all currency options for an independent Scotland would cost more than the current status quo.

According to the FT the SFE is about to publish a briefing paper looking at the issues of currency uncertainty and increased regulatory costs in the event of Scotland leaving the United Kingdom.

In their letter the group say they were surprised by the SFE's views which they say have not been fully endorsed by its board and which 'do not reflect the balance of opinion in the Scottish financial sector, nor provide an objective analysis of the opportunities and risks involved - whether a Yes or No vote is recorded.'

They call for 'more thoughtful consideration' arguing, 'There are certainly opportunities to attract more jobs and investment to Scotland with the powers of independence and significant opportunities in an independent Scotland for financial services.'

Their intervention marks an attempt to break the perception that Scotland's businesses are opposed to independence. This follows the decisions of Standard Life and Alliance Trust to make contingency plans to move more of their operations south of the border should a 'Yes' vote occur.

Jim Spowart, founder of Standard Life Bank and online bank Intelligent Finance, is another signatory to the letter.

BlackRock warning

BlackRock, the US investment giant, waded into the debate this week with a report highlighting the ‘major uncertainties, costs and risks’ for Scotland and the UK from a breakup of the union.

The fund management giant said with a currency union between a newly independent Scotland and the rump of the UK appearing ‘infeasible’, Scotland introducing its own currency would be the ‘best of the few choices’ open to Edinburgh.

BlackRock noted that oil and gas revenues would be critical to Scotland’s finances, but warned any future independent Scottish government against basing its spending plans on oil revenue projections. It said given the difficulty in predicting the money raised from oil and gas, to do so would be ‘uncertain and unwise.’

Indeed, in the Budget last week, the Office for Budget Responsibility (OBR) over the next five years by £8 billion. Since 2010, the OBR has downgraded North Sea oil field tax revenues by £21 billion for the five years to 2015-16, prompting chancellor George Osborne to say this shows ‘how precarious an independent Scotland would be'.

BlackRock did, however, play down concerns about the financial services sector in Scotland. Although Standard Life last month warned that if Scotland were to become independent, BlackRock said a ‘wholesale exodus of staff and operations [from banks and insurers] would be unlikely, given Scotland’s cost advantage over London and other locations’. It also added that fears that an independent Scotland would be anti-business ‘are unfounded’.

The Scottish referendum on independence is to be held on 18 September.

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