The risk of job losses in the Capital following Standard Life’s warning it could relocate from Edinburgh if Scotland votes for independence has been played down by the Capital’s economy leader.
The insurance giant, which is headquartered in Edinburgh and employs around 5000 people here, said yesterday it was making contingency plans, including setting up new companies outside Scotland to which it could transfer operations.
However, city economy convener Frank Ross, a leading Scottish Nationalist member of the Labour-SNP coalition running the city, claimed any relocation was likely to revolve around registration for tax purposes rather than moving jobs.
He said: “As far as I can see there would appear to be no threat to jobs whatsoever. Standard Life are here because of the quality of the workforce. I don’t see them putting their business at risk if this is the best place to be.”
He said he was not seeking any talks with the company to clarify its position. “I speak to Standard Life on a regular basis, so I’m sure it will come up and we will discuss it. Will we have a special meeting to discuss it? No, I don’t think so.”
Publishing its annual report yesterday, Standard Life highlighted uncertainties about an independent Scotland – including concernsabout the currency and the financial regulatory regime – and said it would “take whatever action necessary” to protect its business.
Labour shadow business minister Ian Murray, MP for Edinburgh South, said thousands of people could lose their jobs if the company quit the Capital and criticised the SNP’s response.
He said: “Standard Life have legitimately expressed in public what they and others have been saying in private for some time. For the SNP to just dismiss this does a disservice to their constituents, and the thousands of people employed in the financial services sector across our city.”
Lothian Labour MSP Sarah Boyack said she did not believe Standard Life aimed to play politics, adding: “It’s a much needed reality check to the lack of answers to the questions posed by the referendum.”
CBI director-general John Cridland said Standard Life’s comments underlined concerns felt by many successful Scottish-based firms. He said: “Faced with uncertainties around currency, the shape and role of the monetary system, the European Union, and future taxation and regulation, businesses need evidence-based clarity from the Scottish Government so future jobs and competitiveness can be assured.”
At First Minister’s Questions, Alex Salmond said he believed Scotland would continue to be a good place for Standard Life to do business and pointed out that only a few days ago the company had hailed a £75 million planned development in Edinburgh’s St Andrew Square as “a first-class long-term investment for our partners.”
The Unite union, which represents Standard Life staff, was not commenting except to say it took a neutral stance on independence and would always seek to protect its members’ interests.
Two views of the issues
Marco Biagi, SNP MSP for Edinburgh Central
In 1997 three quarters of businesses surveyed by Scotland on Sunday believed a Yes vote for a Scottish Parliament would harm business. Scotland voted Yes, a parliament came, and economic growth actually went up. With limited enterprise powers, successive governments have made Scotland now the best place to invest outside London, according to global business experts Ernst & Young.
Standard Life’s announcement should be viewed both against that experience, and in its detail. For Standard Life’s comments show exactly why the proposals for formal pound sharing and joint regulation of financial services are right for business certainty both north and south of the Border.
Moreover, business can flow two ways. Switzerland and Luxembourg show that nations smaller than their neighbours can already be the more successful in financial services. With our highly educated English-speaking population and the full range of economic powers of a normal country, an independent Scotland would see businesses relocating here.
Liz Armstrong, chief executive of the Scottish Chambers of Commerce
Scottish businesses plan ahead for different situations, whether it is the referendum or other economic changes and they are obliged to report external issues which may impact on their business – this is normal practice.
Today’s announcement from Standard Life confirms what businesses have said since the referendum debate started: uncertainty from any source can impact on the operations of any business.
It is therefore sensible and necessary to plan for possible eventualities and there is a responsibility towards both shareholders and customers to do so.
Businesses can plan best in a stable economic environment.
The referendum is necessarily creating some degree of uncertainty and businesses will naturally work with this and plan accordingly, so whether Scotland chooses to vote ‘Yes’ or ‘No’, they will need stronger detail from both sides of the campaign on issues such as tax, currency and European Union membership in order that they can best plan for the future.