This time last week the financial services industry was braced for significant upheaval as it waited to hear what fate Scotland had decided for the union. There were some advisers, including self-styled “expat Scot” Lee Robertson of Investment Quorum, who were dedicated enough to follow the results through the night.
Following the vote, which saw a decisive win for the Better Together campaign, the markets breathed a collective sigh of relief, with shares of companies such as Royal Bank of Scotland and Lloyds Banking Group up on the news. Sterling was also buoyed in overnight trading as the counts through the night pointed to a win for the No campaign.
It is difficult to put a figure on what the referendum has cost in monetary terms, but in company time and resources alone the burden has been great, at a time when there is no shortage of regulatory and political change. Some would argue that cost was worth paying in the bid to secure an independent Scotland.
In the wake of the vote, providers and advisers are no doubt keen to return to a overflowing in-tray of non-Scotland related issues, not least the Budget reforms. But the ensuing political row over “English votes for English laws”, and claims that Westminster and the No campaign made Scotland promises it cannot keep, has meant financial services are still wary over the future of the UK.
Interestingly, Alliance Trust has yet to close the paper companies it set up ahead of a potential Yes vote, given the risks posed by the current political uncertainty. Meanwhile some big name Scottish brands have remained tight-lipped over the extent of contingency plans they have in place to cope with a devo-max framework.
As all advisers know, where there is uncertainty among politicians, there is a potential headache for advice firms. Could power in the future UK be divided along federal or even regional lines? If devolved tax-raising and other powers are agreed, what would this mean for issues such as tax planning, inheritance tax, pensions or long-term care? Will advisers have to limit themselves to only advising on the jurisdiction in which they are based?
Some firms will look on this situation favourably, perhaps by creating a niche for themselves specialising in Scottish advice issues for example.
As EY financial services senior adviser Malcolm Kerr puts it: “Advisers are the people that will have to turn that complexity into simplicity.”
Natalie Holt is editor of Money Marketing – follow her on Twitter here