Alliance Trust assesses impact of Scotland independence debate

The Alliance Trust, a Scottish investment company with £3bn AUM, has begun to research the macroeconomic numbers of Scotland in response to unprecedented demand for such information in the wake of the debate on possible Scottish independence.

Shona Dobbie, chief economist and head of Research Centre at the AllianceTrust, stressed that the work was not intended to put forward an argument for or against any possible specific referendum question that may yet be put to Scottish voters on the issue: Alliance Trust, like many Scotland-based financial services organisations (it is based in Dundee), is not taking a view, not least because the specific wording of any possible referendum question is yet to be determined.

Instead, the work is intended to attempt to produce a straightforward macroeconomic assessment of the country currently, in the context of possible future political outcomes.

Questions around independence are dominating media locally. For example, newspaper The Scotsman devoted three of its first five pages to the issue in its edition of Monday 23 January. It is further highlighted this week as Scotland celebrates Burns Night, the annual celebration on 25 January of poet Robbie Burns, considered one of Scotland’s greatest cultural icons.

Following the ruling Scottish National Party call for a referendum on independence to take place in 2014, there are three outcomes being discussed at Holyrood, the Scottish Parliament in Edinburgh, and at Westminster, the UK Parliament in London.

The first is for a referendum that may ask Scots to vote for complete independence from the UK. The second is for a referendum that may ask voters to consider so-called ‘Devo-Max’ – essentially further autonomy within the UK, including particularly fiscal independence. The third outcome could be that no referendum takes place at all: constitutionally, question marks remain over whether the Scottish government can call a referendum without the agreement of Westminster. Further discussions around this are expected in the near term.

Polls of English voters suggest they increasingly see themselves as ‘English’ rather than ‘British’, with a growing perception that Scotland’s economy is being unfairly supported by taxes paid by English taxpayers.

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