A large majority of businesses fear that different tax rates in Scotland and the rest of the UK will lead to increased costs and potentially even relocation, according to JLT Employee Benefits’ latest 250 Club survey*.
The present edition, which polled top UK firms either based or having dealings in Scotland, aimed to assess the sentiment of these businesses following the result of the recent referendum on Scottish independence.
Almost two thirds (64%) of business leaders polled were pleased with the outcome of the referendum. The percentage is even higher when looking exclusively at businesses based in Scotland (70%). But while two thirds (67%) of respondents (78% among respondents based in Scotland) believe that income tax rates in Scotland should at least partly be under the control of the Scottish Parliament, some 82% of respondents think that there will be more than a nominal cost to their business in the event of diverging tax rates, with 45% saying that the cost will be material. With concerns over diverging tax regimes running high, over a quarter of businesses (26%) based in Scotland said that they would consider at least a partial relocation of their business in this event.
The survey also found that, overall, there was little support for a different State Pension or State Pension Ages in Scotland compared to the rest of the UK. However, a closer look reveals a dissonance from employers based in Scotland with over half (56%) believing that the Scottish Parliament should have control over the level of State Pension and/or State Pension Ages for Scottish residents.
With regards to the key UK pension bodies (such as tPR, PPF and NEST), over half of all respondents (54%) do not think that Scotland should have its own version of those organisations. Respondents based in Scotland agree; 57% of ‘Scottish employers’ taking part in this JLT 250 Club survey do not want Scotland to have a separate regulator for pensions, nor do they want Scotland to have its own pension ‘lifeboat’ or Scottish Employment Saving Trust (‘SEST’ - which was a SNP proposal in the run up to the referendum).
Malcolm Paul, Chairman, JLT Employee Benefits Scotland said: “Whilst the dust continues to settle following the recent Scottish referendum, concerns still abound amongst business leaders about the potential impact that devolved Scottish powers could have on their companies. With new clouds of uncertainty facing all businesses with dealings north of the border, it will be critical that any departure from the current status quo is handled with particular care to avoid unforeseen consequences.
“A clear channel of communication between business leaders, Holyrood and Westminster will be critical for the future success of Scotland.”
*) The 'JLT 250 Club' is a consumer group of around 250 leading companies who have agreed in advance to complete short YouGov surveys on topical pension issues. All organisations in the 250 Club have at least 500 full-time employees and most members employ more than 3000 such staff. Also, nearly 100% are in the private sector (limited company or plc).
Notes to Editors
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About JLT Employee Benefits
JLT Employee Benefits is one of the UK's leading employee benefit providers offering a wide range of benefit and pension services, including administration, actuarial and pension consultancy, investment, Self Invested Personal Pensions (SIPPs) and Small Self Administered Schemes (SSASs) administration, flexible benefits, healthcare, benefit communication and financial education.
JLT Employee Benefits employs over 2,200 professionals throughout the UK and in 2013 had revenues of £172m in UK & Ireland.
Pensions and employee benefits companies within the JLT Employee Benefits group of companies include: JLT Benefit Solutions Ltd, Profund Solutions Limited, JLT Wealth Management Limited, JLT Investment Management Limited and Independent Trustee Services Limited. JLT Employee Benefits is part of Jardine Lloyd Thompson Group plc.
About Jardine Lloyd Thompson Group plc
Jardine Lloyd Thompson is one of the world's largest providers of insurance and employee benefits related advice, brokerage and associated services. JLT's client proposition is built upon its deep specialist knowledge, client advocacy, tailored advice and service excellence.
JLT is quoted on the London Stock Exchange and owns offices in 39 territories with some 9,000 employees. Supported by the JLT International Network, it offers risk management and employee benefit solutions in 135 countries.