The Scotland section of UK plc includes key facts, Top 25 companies ranked by turnover, transport statistics, political tables and regional contacts.
This is an extract from the Scotland section of UK plc
The devolution question
The election of the Scottish National Party to the Scottish Parliament has finally drawn businesses into politics, if only because the spectacle just got good. Where Labour’s second term under Jack McConnell was often uninspiring, the charismatic Alex Salmond puts on a much better show.
What came as a surprise is the appeal the notion of independence has for some of Scotland’s most senior business figures. Although there are doubts as to what the SNP might be able to accomplish with a minority government, what the party has succeeded in doing is tearing the lid off the debate. Previously, independence was not even considered a serious topic of discussion, especially among the Labour-oriented elite. But then Sir George Mathewson, fresh from relinquishing chairmanship of the Royal Bank of Scotland, wrote a letter to a newspaper saying he was backing Salmond. Suddenly it was okay to be serious and support the SNP.
What SNP had that Labour or the Liberal Democrats did not was an argument in favour of Scotland adopting a low rate of corporation tax like that of Ireland – a tempting proposition even for the most conservative of business folk. But Labour has since started to hit back, bringing in to lead them another of Scotland’s more talented politicians, Wendy “big sister of secretary of state Douglas” Alexander. With her MBA from Insead, she has some serious ideas about fiscal autonomy. If only she can persuade Whitehall to loose the reigns in order to steal back some of the SNP’s thunder.
Even with the SNP in power there is no certainty Scotland will break from the UK. Along with a significant proportion of the populace, many top business people, including those you might expect to have an instinctive leaning towards Scottish independence such as Clyde Blowers’ Jim McColl, remain steadfastly in favour of the Union.
What most businesses would vote for is an improvement on the gentle lag the growth of the Scottish economy has behind that of the UK. Some also suggest that Scottish companies should change its marked reluctance to access the public markets. Underrepresented on AIM, Scotland’s mid-sized companies tend to prefer private family ownership and the sensible support of Scotland’s home-grown clearing banks to ambitious growth via the public markets.
The sale of one of Scotland’s largest companies, Scottish Power, to Spanish company Iberdrola struck some as selling the family silver. However, the growth of university spin-out companies such as Wolfson Microelectonics and MTEM, an oil and gas tech company recently sold a Norwegian company, gives Scots the realisation that, actually, Scotland is getting quite good at commercialising its robust research capability.
Braveheart Ventures, a consortium of angel investors who professionalised in a recent flotation on AIM, has launched a series of multi-million pound venture funds tied to Scottish universities. Scottish Equity Partners, resolutely a venture fund involved in early stage companies, still invests where private equity usually fears to tread.
CBI Scotland’s assistant director, David Lonsdale, sums up the economic outlook for Scotland well: “Scotland’s economy is continuing to perform moderately well, but the chances of sustaining that performance, let alone improving on it, will be all the harder if the wider UK growth rate eases back next year.”
Erikka Askeland is deputy editor
of Scottish Business Insider magazine