SELECT COMMITTEE ON ECONOMIC AFFAIRS - Parliament

Mr John Cridland, Mr Graeme Leach and Mr Simon Walker—Oral evidence (QQ 279–330)
was going to be very different from the rest of the United Kingdom or actually remarkably
similar.
Q294 The Chairman: Would you have a concern if the referendum took place and a lot
of these questions had not been explored properly or answered?
John Cridland: Yes, I would. If I was speaking directly for the Scottish council of the CBI,
these are precisely the sorts of questions that CBI Scotland has been raising in a totally
objective way and seeking answers to.
Q295 Lord Levene of Portsoken: I do not want to belabour the point, but just coming
back to financial services, we were talking about the views that the largest businesses there
might hold if they felt that they were no longer under the UK umbrella. That is one side of
the argument. The other side is: what would their customers think? I travel abroad a great
deal and in countries like Mexico or China you suddenly see an RBS pop up. The local
business communities regard RBS as a large British bank, with all the pluses and minuses of
that. I do not think many of them will have drilled down to consider that this may not
actually be a large British bank any more, it is now a large Scottish bank, and the possibility
of ending up with a situation like in Iceland. Are you hearing at all that the customers of
these businesses, particularly in the financial sector, would start to worry if they felt that
their individual institution was no longer backed by a much larger country such the UK
rather than a much smaller one such as Scotland?
John Cridland: I have not heard those views expressed yet by customers, but I hear the
debate beginning to generate momentum. It is not unreasonable that we may reach that
point but I have not had that view expressed to me yet.
The Chairman: The financial compensation scheme might occur to customers. Lord
Lawson.
Q296 Lord Lawson of Blaby: I have two questions. First, following on from what you
have just been saying, Mr Cridland, I quite understand why you and your members would
like to know all the terms and conditions and particulars of a divorce, but the evidence we
have received suggests that that is not going to happen. Indeed, if I may use the metaphor of
a divorce, it is customarily the case that when partners in a marriage decide to divorce, the
decision is taken then and there is a lot of negotiation afterwards about the financial
settlement and other arrangements. So you are not going to know. Some of these things are
going to be matters for negotiation. Some will be between the United Kingdom and Scotland
if the referendum goes in favour of independence; others will be dependent on what an
independent Scotland decides to do, and it is not going to show its cards in advance. Given
that you are not going to know, what are you going to do about it?
My second question is perhaps less pointed or urgent. Assuming the separation of the
English and Welsh economies, the structures of the English economy and the Scottish
economy are rather different, not so much in the case of financial services, where both are
heavily dependent on financial services, but it is quite clear, for example, that the Scottish
economy is more heavily dependent on oil and gas and has a much larger public sector
proportionately than the rest of the United Kingdom. Mr Walker pointed to the happy
prospect of Scotland having lower taxation and higher public expenditure, so quite how that
would play out is a question. Leaving that aside, there are these differences in structure. In
the event of independence, do you think there would tend to be greater divergence or a
degree of convergence, and does it matter?
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