Big firms ‘scared to do business in uncertain Scotland’

GEORGE Osborne has warned that uncertainty over a referendum on independence is damaging Scotland’s economy and blocking investment north of the Border.

The Chancellor spoke of “instability and uncertainty” and said that some of the world’s biggest companies have voiced concerns about doing business in Scotland.

The Tory/Liberal Democrat coalition at Westminster is considering taking control of the referendum from the SNP if Labour come out in support of the move.

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Mr Osborne said yesterday: “I think the instability and the uncertainty that hangs over the Scottish economy [is] because of Alex Salmond raising the prospects of independence without actually providing any detail of when he wants to have his referendum or what the question will be.

“I think that uncertainty is damaging investment in Scotland – and there are major businesses around the world who have asked me, as Chancellor in the last year, ‘tell us what is going on in Scotland – we’re worried about making an investment in that country’.

“I have told them go ahead with the investment, but I have to say those questions are being asked, and I think that is having a direct impact on Scottish jobs and Scottish prosperity.”

Asked which companies he had spoken to and how much investment was involved, Mr Osborne replied: “I don’t want to go into the specific companies, but I can tell you they are some of the largest companies in the world. These are private conversations I have had.

“I, I have to say, always answer ‘invest in Scotland’. I think it’s a great place to invest, but I think people have to be aware that the uncertainty about independence, the uncertainty about what sort of referendum Alex Salmond wants, the complexity of the question that he wants to pose to the Scottish people – all those things at a time when anyway there’s a lot of economic uncertainty in the world – are adding to the economic uncertainty in Scotland.”

However, First Minister Alex Salmond hit back by accusing Mr Osborne of “juvenile scaremongering” and attacked the Westminster government’s economic policies.

Mr Salmond insisted that the “great companies of the world” are investing in Scotland.

“Companies like Amazon, like Avaloq, like Doosan, Mitsubishi, they’ve all decided to invest in Scotland,” he said.

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“That’s one of the reasons, even in these difficult economic times, while our employment in Scotland is higher than the rest of the UK, our unemployment is lower.

“Our biggest economic problem in Scotland has got nothing to do with an independence referendum and everything to do with George Osborne and Tory economic policies from London.

“This is a chancellor on the run, engaging in the most juvenile scaremongering of Scotland and none of it’s going to work.”

Mr Osborne’s intervention heaps further pressure on the First Minister to name a date for the referendum and to reveal the wording of the question that would be put to voters.

With the Scotland Bill offering more powers to Holyrood being debated next in the Lords in January, several peers including Labour’s Lord George Foulkes and former Tory Scottish secretary Michael Forsyth are planning to bring forward amendments to force a vote on independence by 2013.

Although the amendments are unlikely to succeed it is understood that Conservative Scotland Office minister David Mundell has been holding informal discussions about Westminster organising the referendum.

Labour is said to be split on Westminster taking control, although support for it is gathering momentum.