July 20, 2015 – While Scotch Whisky is by far Scotland’s largest non-oil export product, much of the industry is controlled by companies headquartered far outside of Scotland – a sore point for some Scottish nationalists. With the Scottish National Party (SNP) now dominating the devolved Scottish government in Edinburgh and Scotland’s Parliamentary delegation in Westminster, a group of party activists wants the SNP to consider some form of intervention in the whisky industry.
According to the Herald Scotland, the group led by former Diageo executive Donnie Blair, labor union leader Bill Ramsay, and the Common Weal think tank are submitting a motion for consideration at the SNP’s annual party conference scheduled for October in Aberdeen. While the motion recognizes Scotch Whisky’s role in the Scottish economy, the activists want a bigger piece of the pie to remain in Scotland.
“Conference calls upon the Scottish Government to establish a task force to consider… how to further develop the employment potential of the Scottish whisky industry.. to look at the feasibility of reforming the licensing regime for distilleries… to ensure that more of the revenue raised from the activities of the industry stay in stay in Scotland [and to] examine the feasibility of increasing the revenue of the industry”
That’s a direct shot across the bow at the multinational corporations that own most of Scotland’s whisky distilleries, including London-based Diageo, Paris-based Pernod Ricard (Chivas Brothers), Bahamas-based Bacardi (Dewar’s), and Japanese-owned Beam Suntory. The activists cite studies claiming that 83 percent of the Scotch Whisky industry is owned by non-Scottish companies, while only around 2 percent of the industry’s revenues stay within Scotland.
Scotch Whisky Association executives have criticized those studies, and following the Herald’s report Sunday, SWA spokeswoman Rosemary Gallagher defended the industry’s economic impact in an email to WhiskyCast. “Scotch Whisky is of major benefit to the economy,” she said. “It adds more than £3 billion in value in Scotland and a total of £5bn across the UK. The industry supports around 40,000 jobs and is the linchpin of many communities”
There’s no guarantee that the motion will actually make it to the SNP conference agenda. Last week, SNP leader and First Minister Nicola Sturgeon praised the Scotch Whisky industry for its success in international trade, and suggested that the industry could be a model for other Scottish business sectors.
It should be noted that, with a few exceptions, the Scotch Whisky industry was generally opposed to the 2014 Scottish independence referendum supported by the SNP on the grounds that it could upset global trade agreements worked out by UK diplomats over the last decade that protect Scotch Whisky exports. At the time, a number of industry executives privately expressed concerns that there might be some form of political “payback” for taking that position.