View more on these topics

Independent Scotland poses questions across UK financial services

Hopes that a single UK financial services industry could exist if Scotland becomes independent from the rest of the UK have been called into question by the Scottish Financial Enterprise.

Edinburgh Scotland Sunset City 480

SNP leader Alex Salmond is due to publish his Independence White Paper, outlining prospects for businesses and macroeconomics, ahead of the referendum in 2014.

The SFE is the privately owned representative body for financial services in Scotland. In what he calls an “industry observer’s perspective”, SFE chief executive Owen Kelly highlights the core issues of the case for independence for the single market of UK financial services.

At this stage, any questions raised can only be observations as the SNP’s ‘Yes’ campaign unfolds, but Kelly points out some of arguments for independence that already implicate a distinct impact for financial services.

Kelly highlights that some of the pro-independence campaign’s proposals to preserve parts of the single market for UK financial services clash with EU regulations.

The pro-independence campaign has put forward the idea that an independent Scotland could remain with the same financial regulator as the rest of the UK. However, Kelly points out that this does not fit with EU regulations stating that each member state must have its own distinct regulatory jurisdiction.

Kelly also questions the mutual benefit of maintaining this single market for both Scotland and the rest of the UK. He says: “There is no obvious benefit to the rest of the UK in bearing the risks and liabilities of regulating the industry of another member state.

“It seems unlikely that the Parliament in a newly independent Scotland would want to demit a function of government as important as financial regulation to the legislature of another country.”

Kelly goes on to argue that it is difficult to find an argument for a unique regulatory framework in Scotland from the facts presented by pro-independence plans.

He says: “The facts we can ascertain now about the regulatory framework suggest it would be difficult to negotiate some sort of unique arrangement for Scotland (and, by extension, the rest of the UK), when Scotland is one of the EU’s leading financial centres and London is the largest financial centre in the world.”

Elsewhere, the Confederation of British Industry in Scotland has published its own paper ‘The Scottish Government’s Independence White Paper – issues that business would like it to address’.


Montlake Andrew MS blog 150

Market Watch

I must admit I am writing this in the throes of a raging hangover from an excellent night at The Mortgage Strategy Awards. The industry’s Oscars outdid themselves with a simple theme, great host in the gorgeous Gabby Logan and an atmosphere that was refreshingly positive. It was great to see the top awards for […]

PFS hires Richards as CEO

The Personal Finance Society last week appointed Tenet distribution and development director Keith Richards as its new chief executive. Richards will replace Fay Goddard who announced in November she is retiring after almost five years heading up the trade body. The announcement was made on Thursday last week just hours after it was revealed Richards […]

MS 18Feb Cover Index

The war on fraud

Is the mortgage industry winning its five-year battle against the conmen? No, says Experian, which warns of a fraud surge this year. Yes, says the PMS’s John Malone, who believes that initiatives to combat the problem are working


News and expert analysis straight to your inbox

Sign up