The game just got real. Cameron, Clegg and Miliband have stopped playing politics and jumped on a plane to Scotland because the single most seismic moment in recent UK history is about to take place. And the food and drink industry is centre stage.
OK, maybe it’s slightly stage left. Scotland does have oodles of oil and it’s doing a roaring trade - exports exceeded £30bn in 2012. But food and drink puts on a good show. Scotland Food & Drink claims the industry is worth £12.4bn. Export-wise, in 2013, it generated £5.4bn. whisky made up £4.3bn of that, selling £140 worth a second. salmon , seafood, dairy and red meat delivered £829m.
The numbers have never been better. And the Yes camp, which has progressed by cheerfully swerving realpolitik to spin visions of an independent nation rich in oil and whisky, thinks if Scotland votes for independence there is plenty more to come.
“The huge boost to Scotland’s global brand generated by a Yes vote, and the transition to independence, will be the opportunity of a lifetime for our food and drink industry to extend their global reach even further,” says its talisman Alex Salmond. His thoughts are echoed by Scotland’s food minister Richard Lochhead, who says despite the “tremendous growth” in recent years, “we can do so much more.”
It all sounds marvellous. So why does it feel like the majority of the Scottish food and drink industry fail to share their enthusiasm? And why aren’t more of them prepared to stand up and say so?
Intimidation
Obviously there are exceptions. In 2012, the former Mackies chairman, Maitland Mackie, who passed away in June, came out firmly in support of the No camp. At the same time, he noted the “clear nervousness” among fellow food and drink businesses to do the same. That nervousness has continued.
Asked by The Grocer, the majority of the Scottish industry has only been happy to state their intentions off the record. For the record, the majority intend to vote No, largely because business is brisk and they are averse to the inevitable upheaval and uncertainty independence would bring.
So why the nervousness in saying so? Obviously fmcg brands require broad support across consumers, and support from government to drive future exports, so may be wary of taking a stance on polarising subjects. Yet the nervousness has also been attributed by some to intimidation from the Yes camp, similar to that - away from the food and drink industry - aimed at author JK Rowling.
Heavyweights like Baxters, 2 Sisters or Famous Grouse, which joined 130 other signatories to encourage other business to vote No in an open letter to The Scotsman, may be in a position to roll with the punches.
However David Sands, former retailer and chairman of David’s Kitchen, who is also firmly in the No camp, told The Grocer that many companies have found it “difficult to publicly state their position for fear of being intimidated.”
In an exclusive online interview with The Grocer earlier this week, chief secretary to the Treasury and “proud” Scotsman Danny Alexander said he was worried about intimidation and abuse. “I find it very depressing that, in a democracy, people should feel those things. I think it’s important that people don’t feel that way, and get up there and make their argument. It matters for everyone in Scotland to know the impact.”
Pricing
That impact also matters for many companies with an HQ in England, including supermarkets and their customers. The logistics of Scotland (fewer roads, lower population density, greater distances) - plus a shrinking market - could increase the cost of doing business in Scotland.
Asda CEO Andy Clarke has thus far been the only retailer to point out that, without the need for national pricing, food prices could go up. On Thursday (11 September) he reiterated his warning: “If we were no longer to operate in one state with one market and – broadly – one set of rules, our business model would inevitably become more complex. We would have to reflect our cost to operate here.”
On Friday (12 September), former Sainsbury’s boss Justin King echoed his views.
Privately, says Alexander, “senior execs at the top five supermarkets have [all] said in a smaller market with higher costs, the basic underlying price would likely be higher. Their arguments are credible and stack up economically.”
Yet when leaflets emerged from the No camp last week, stating that independence would see Tesco prices rise by 16%, based on Tesco prices in Ireland, an alarmed Tesco quickly insisted it was “not true”, “entirely speculative” and that some groceries were, in fact, cheaper in Ireland than the UK.
Industry bodies
The pricing spat is just the latest ding dong in a political scrap characterised by wild speculation (even on fundamental issues like currency) and high levels of acrimony.
Caught right in the middle of the drama are industry bodies, like Scotland Food & Drink, the Scottish Grocers Federation, the Scottish Fisherman’s Federation and the NFUS. All encourage debate, but are clear they won’t be taking sides. However, the SFF has released its take on the evidence before it, identifying “pressure points” that could result from independence.
These include EU membership (“would we be better or worse off? Nobody knows”), negotiation over fishing quotas (“not easy … would take place in parallel with other discussions such as currency and the national debt”) and the consequences of going from big to small on the world stage (“all practical European evidence suggests big will win on the big issues”).
Ultimately, the SFF sums it up the options thus: “A small, agile country speaking for itself, making and living with its own decisions. Or a long-established bigger unit, embracing all its components, and more able to cushion shock, smooth out change and invest.”
Whatever its objective intentions, it amounted to a warning. The SFF subsequently copped a lot of flak. Yet before crunch time on Thursday, both sides will have more valid arguments to make. And everyone involved, Yes or No, should hope both sides feel confident enough to make them, whatever levels of opprobium they generate. Because Scotland deserves to hear all sides of the story. And there is no going back.
No comments yet