Scotland votes No but questions remain

Scotland has voted No, choosing to remain a part of the United Kingdom with a record 86% turnout. Though the reasons for the decision will vary among individual voters, a dominant theme was concern over the economy, not least the uncertainty around paying for pensions, as we explained in the Financial Reporter.

Although the geography remains the same, the landscape has changed dramatically. Not only will there be a further devolution of powers north of the border, but the possibility of an independent Scotland created such concern that the value of the pound dropped and a number of financial institutions had made contingency plans to move south. The consequence of this was potentially huge: while North Sea oil generates around £4bn to the Scottish economy, the financial industry generates £7bn and employs 100,000 people. An exodus could have been disastrous.

RBS has announced things are continuing as normal, but Standard Life has stated it will make decisions based on changes: "We will consider the implications of any changes for our customers and other stakeholders ... to ensure their interests are represented and protected."

Whether all of these companies will decide to remain where they are is yet to be seen, but change is certainly on the horizon: Scotland's majority was to be part of the union, but it was a very big minority - 45% - that voted for independence. One thing screams out from that result: the status quo has been disturbed.

It's therefore advisable that anyone invested in a Scottish scheme or companies should monitor the discussions and performance over the coming weeks, because of the risk of money and institutions still choosing to pull out of Scotland. As The Economist notes, it was "a strong turnout by Scottish pensioners" that secured victory for the No campaign, and devolution negotiations are absolutely necessary to ensure smooth relationships going forward - "the British nation state has survived; yet it remains on life support."

Then there is the possibility of devolution-supporters feeling let down by the companies that announced they would move south in the event of independence, and the possible consequences of certain devolution powers. For example, David Cameron has pledged to give Scotland power to decide its own tax and welfare plans, which could impact the state pension. Similarly, if new powers allowed Scotland to reduce the retirement age as the Yes campaign promised, pensions could be affected.

Following this result, the union remains but it will not be the same as it was. Questions linger, and if you have money in a Scottish investment, or are considering one, professional financial advice should be sought to help make sure you know the possible risks.

What do you think of the result, and are you concerned about your investments because of it? Let us know on Twitter or Facebook.

Call 0800 304 7288 for a friendly chat about your pension

The details provided in this article are for general information only and are in no way deemed to be financial advice. All of the material is correct as of the publication date, but could be out-of-date by the time you read the article. For our latest information and news, please see our articles section: https://www.portafina.co.uk/whats-new

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