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SWA chief outlines benefits of staying in the UK

The new chief executive of the Scotch Whisky Association has said the industry prizes stability and highlighted advantages it enjoys from Scotland being part of the UK.

SPIRITED: Scotch Whisky Association chief executive David Frost said the sector values 'certainty, stability and predictability'. Picture: Anthony Upton
SPIRITED: Scotch Whisky Association chief executive David Frost said the sector values 'certainty, stability and predictability'. Picture: Anthony Upton

Noting the industry is thriving amid a boom in Scotch exports, David Frost said: "The impact, access and attention that we can get from being part of a big country is important to us."

Mr Frost stressed the Scotch Whisky Association has not offered an opinion on what the best outcome of the referendum on Scottish independence in September would be.

"We don't do party politics, we have not taken a position on the constitutional question," said Mr Frost, who started work at the association in January following a successful diplomatic career.

However, Mr Frost said the industry values certainty, stability and predictability.

He said that the association wants more information about four key issues before the referendum, including how the currency question would be managed in an independent Scotland.

Mr Frost was speaking to reporters in Edinburgh hours before Chancellor of the Exchequer George Osborne ruled out the possibility of an independent Scotland joining a Sterling currency union in a speech in the capital city.

The association wants to know how independence would impact on the relationship with Europe.

It wonders what the implications for regulation would be and what support would be given to the industry internationally.

A former head of the UK civil service's trade policy arm, Mr Frost said the UK diplomatic corps plays an "incredibly important" role in the success of Scotch in overseas markets.

The staff in the UK's 200 embassies around the world have built up valuable knowledge of the countries in which they are based and networks of contacts.

He highlighted the challenges that operating overseas poses for whisky firms given widespread passing off of local brews as Scotch.

"At any given moment we are arguing about 70 cases overseas," said Mr Frost.

Noting the Scottish Government has proposed to have 90 embassies, he asked if an independent Scotland could secure the same access to markets as the UK can.

But he stressed the association wants the UK Government to reduce the tax burden on whisky sales in the Budget in March.

It calculates around 80% of the price of the average bottle of whisky in the UK is accounted for by duty and VAT.

Mr Frost said the industry enjoyed big benefits from the UK's membership of the European Union.

"The single market and the single set of rules that has come with it has been incredibly important to the success of the industry," he said.

Mr Frost reiterated the SWA's belief that the Scottish Government's planned minimum price of 50p per unit on sales of alcohol would breach the rules of the single market, while failing to deal with the social problems in which alcohol is a factor.

It is challenging the legality of the legislation in the Court of Session.

But Mr Frost said the association's relations with the Scottish Government are "perfectly professional and constructive".

A Scottish Government spokesperson said that by sharing Sterling with the rest of the UK, trade would continue to be underpinned by a common currency while an independent Scotland would be more able to design a regulatory framework to support businesses. Scotland would be a member of the EU.

The spokesperson added: "With independence and our own more effective overseas representation, we can promote our products to the world and tackle barriers to trade that the Westminster Government does not prioritise."

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