Scottish Independence: Businesses fear Yes vote

Lloyds said independence would increase the cost of financing the company. Picture: PA
Lloyds said independence would increase the cost of financing the company. Picture: PA
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ALEX Salmond’s ambition of an independent Scotland was under fresh pressure today after more senior business figures raised fears about Scotland splitting from the rest of the United Kingdom.

Lloyds Banking Group, which includes the Bank of Scotland and has 18,000 Scottish staff, said in its annual report that independence risked damaging its business by increasing the cost of financing the company.

Rival Barclays said the independence referendum – and the prospect of a UK-wide referendum on Europe – introduced “potentially significant new uncertainties and instability in financial markets”.

And oil giant Shell said it wanted Scotland to stay in the UK. Chief executive Ben van Beurden said: “We’d like to see Scotland remain part of the United Kingdom. Given a choice, we want to know as accurately as possible what investment conditions will look like ten or 20 years from now.” There were also claims that EU law may force banks such as Lloyds and Royal Bank of Scotland to move their registered offices south of the Border if Scotland became independent.

A BBC blog said an EU directive stated that banks must have their head offices “in the same member state as its registered office”. As a result, it claimed RBS and Lloyds – both of which have their registered offices in Edinburgh – could be required to move these south of the Border.

The directive was described as being untested in the courts, with no case law existing for it.

Scottish Labour finance spokesman Iain Gray demanded Holyrood ministers provide clarity over the future of Scotland’s financial services sector if there is a Yes vote.

He said: “If major financial institutions were forced to move their headquarters out of an independent Scotland, that would be a massive blow for our economy and would result in the loss of thousands of jobs.

“The uncertainty cannot continue, we need clarity on what the SNP will do to secure Scotland’s future prosperity and how they plan to protect our reputation as a centre of excellence for financial services.”

Alistair Darling, leader of the Better Together campaign, said: “With every passing day more risks are coming to the surface. These are all risks that we do not need to face. If we want to avoid them, if we want to protect Scottish jobs, then we have to vote to stay in the UK.”

But a spokesman for Finance Secretary John Swinney dismissed the “scaremongering” over bank jobs. He said: “These suggestions completely fail to take account of Scottish Government proposals for a shared system of regulation that would reflect the fact banks operate in both Scotland and the rest of the UK and is fully compliant with the EU. In any event, this would have no impact on jobs, which could remain exactly where they are now.”