Keith Cochrane is a brave man. The brutal treatment meted out to pro-union politicians, such as Labour’s Jim Murphy, who was pelted with eggs last week, has been enough to deter many business people from voicing their opposition to Scottish independence. Not so the chief executive of Weir Group, one of the prime movers behind last week’s letter signed by 130 Scottish business leaders, urging a “no” vote on September 18.
The Yes campaign hit back the next day, releasing its own letter with 200 business signatories, but it was the choreography behind the “no” letter that makes it the more interesting of the two.
Its origins date back to the CBI’s spectacular blunder in April, when it registered with the Electoral Commission as a campaigner against Scottish independence, only to cancel the registration after temporary resignations from members — such as the BBC and STV — that wished to stay neutral. The result was that the business voice that had been expected to do most of the heavy lifting on the “no” side during the build-up to the referendum effectively was silenced.
That left business leaders who oppose independence, such as Mr Cochrane, with little choice but to get involved. The letter was carefully crafted. While much attention has focused on the presence of big-name signatories, such as Douglas Flint, of HSBC, and Andrew Mackenzie, of BHP Billiton, and on that of the heads of famous Scottish brands, such as Baxters Food Group, what has attracted less comment is that a number of SME owners also signed the letter. They included, for example, Jimmy Buchan, skipper and owner of a Peterhead-based fishing business. This was a deliberate attempt to counter a frequent criticism of the Yes campaign, which is that the No camp’s business backers are largely multinationals, rather than small business owners.
Also striking is that the business voices in the No camp are largely unconvinced by the policy pledges from Alex Salmond, the first minister, that an independent Scotland would be more business-friendly than the present Westminster government.
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Mr Cochrane had this observation on the cut in corporation tax promised by Mr Salmond: “That’s only a small piece of the overall tax picture. We pull our profits across the UK and submit one tax return — which means we can offset profits in one part of the UK against losses in another.
“Whilst the corporation tax reduction that the Scottish government is proposing would save us some £400,000, the actual costs of breaking up that consolidated tax base would be nine times that.”
The business voices of the Yes campaign have some powerful cases of their own. Sir George Mathewson, the former RBS chairman and one of the biggest guns in the pro-independence artillery, is especially good at countering one of the main arguments put forward by Alistair Darling, leader of the Better Together campaign, which is that the Bank of England would be under no compulsion to backstop a Scottish financial institution in the event of independence: “This is scaremongering. RBS’s head office is in Edinburgh, but 95 per cent of its business is done in London.”
Arguably, the Yes campaign should have made more of the business figures supporting it. Spend any time talking with members of the public who are voting “yes” and you will hear the same kind of remarks time and again: “Things can’t get any worse, can they?” or “I’m fed up of being governed from Westminster by a Tory government I didn’t vote for”. Yet these are all negative points.
By contrast, business leaders on the Yes campaign are far better at making a positive case for independence, such as the restaurant owner Andrew Fairlie, who argues about the benefits it would bring to Scottish tourism. Where business leaders do express a negative case for independence, it tends to be focused on specific concerns, such as the heightened possibility of a “Brexit” from the EU should a Conservative-led government be re-elected next year.
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With SNP supporters set to vote “yes” and most Tory and Liberal Democrat supporters expected to vote “no”, victory will go to whichever side can attract the largest proportion of Labour voters, particularly those in traditional working-class households in Glasgow and Lanarkshire. Hence Mr Salmond’s recent emphasis on subjects, such as the NHS, calculated to appeal to them — and it is perhaps significant that Unite conveners in the shipbuilding and defence sectors, which together employ more than 10,000 people, are becoming increasingly vocal about what they see as the danger of voting “yes”.
The key voices that could swing the debate may not come from business at all, but rather from the trade unions.
Blinkbox next in the line of fire
As he settles into his chair today at Tesco’s austere headquarters in Cheshunt, Dave Lewis, the incoming chief executive, has not been short of advice.
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Most frequently trotted out has been the need to sharpen up on prices to compete with the hard discounters and restore Tesco’s credentials as a value retailer. At least the violent rebasing of the dividend on Friday will give Mr Lewis the firepower to do so. The advice has been taken on board and Tesco’s margins, which are famously industry-leading, also look set to be rebased.
Other pieces of advice have included reining back on forays such as the Giraffe restaurant chain and the Harris + Hoole coffee shops. Here, again, though, Tesco is moving — some Harris + Hoole outlets have been closed already.
Another has been to take a leaf out of Carrefour’s book and exit those overseas markets where Tesco is performing poorly. Again, though, it can be argued that Tesco is doing this already: Philip Clarke, Mr Lewis’s predecessor, has removed Tesco from problematic markets, such as the United States and Japan, and recalibrated its operations in China.
That leaves Blinkbox, Tesco’s online streaming service, another of Mr Clarke’s innovations. In principal, this was a fine idea, deepening the relationship with loyal customers and augmenting Tesco’s other product lines, notably Hudl, its tablet.
However, competing head-on with the likes of Netflix and Amazon as well as BSkyB (for which I work) and Virgin Media has proved expensive. Tesco has never revealed details of Blinkbox’s financial performance, but informed sources suggest that Blinkbox may have lost as much as £50 million last year alone. That is a staggering sum when the group is taking the axe to capital expenditure in its core activities, the stores, and under pressure to sharpen up on pricing.
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With the dividend slashed, it would be no surprise were Blinkbox to be the next victim of the Lewis era.
Ian King is Business presenter at Sky News