12/03/2012 Newsnight Scotland

affected. If a dray spring follows the dry winter. -- if a dry spring

follows the dry winter. Good evening. I ask Donald Trump fit is

appropriate to ask a head of Government if he wants to be known

as Mad Alex. And shareholders plot revenge on the Royal Bank of

Scotland old bosses and how many questions make a good referendum?

Are we any wiser after the analysing? The American developer

Donald Trump has upped the ante in his dispute with the Scottish

government by using the expression "mad Alex" in a letter to the First

Minister. Trump has been campaigning against a wind farm

proposal offshore from his golf complex. The tycoon has made clear

his disapproval of Scottish wind farm developments. Now he is

getting personal. In a letter to The SNP leader has not risen to the

bait and a Government statement was But the Liberal Democrat leader was

A short while ago, I called Donald Trump at his office in New York. I

asked him to outthrien point he was making. -- outline the point he was

making. Scotland is a beautiful country to have these ugly

industrial wind turbines, 7,000, maybe 8,000 and I even hear numbers

higher, to have them throughout Scotland, ruining the shores and

the beauty, would be a disaster. Now the people in Ireland are happy,

because tourism in Scotland will cease to exist. Before when I

decided not to do the job, because they were going to put turbines up,

they all said, well I guess you know the turbines won't be built

and they weren't. After my investment was made, they then said,

here come the turbines. So I thought I was dealt with very

unfairly. Is this about Scotland and its environment, or is this

about you and your particular investment? No, I'm happy with the

fact we built this and I look forward to the next phase, as soon

as I get assurances that these won't be built. I love the idea of

building a hotel, I think it will do well. We don't have a loan on

the property, it is interesting e- interesting, I built this out of

cash from my own pocket. I thought you had downed tools? No, we

haven't stopped work. We built the course and it is going to open, in

fact now we're building a temporary club house. And it is going to be

opening in the very near future. It will hope in earl -- early July.

That will happen regardless of the decision on the planning

application. Yes it is finished. We have completed it ahead of schedule.

We will open, in fact we would open sooner, but we wanted some of the

great European players here. They will be in Scotland for the

Scottish Open. Wouldn't turbines and many others help save the

planet and the impact that climate change may have? No, well that

depends on whether you leave e -- believe in climate change. A lot of

people don't believe in it and don't see the issue. You don't

believe the vines? I frankly, as far as climate change, I'm on the

fence. I'm not a believer. And just so you understand, there is always

climate change, but I don't believe some of the reports that came out

and if you look at some of the studies, they are proven to be

false. To destroy Scotland over something which many people don't

believe is in fact a fact is a terrible thing. To destroy the

tourism industry in Scotland, would be I think just, which is I believe

Scotland's biggest industry, would be a disgrace. What do you make of

the comments from the Scottish Liberal Democrat leader, Willie

Rennie who, says you're turning more eccentric and hysterical by

the day and you're attempting toing to bull -- to bully the First

Minister. Don't know who he is. Don't care whoers. If not

hysterical, is not intemporate to describe an elected politician as

being mad? I'm not saying he is mad. But if this goes forward they will

refer to him as Mad Alex. I say that, with all due respect. If he

allows Scotland to be destroyed with his ugly machines, you're talk

about 7,000 to 8,000 all over the coast of Scotland, the only one

happy about it will be Ireland. Because they will take all of your

business as sure as you're sitting there. I thought you and the First

Minister were friends, you described him as an amazing man.

thought we were friends, when somebody who comes out with who igs

a politician with an idea that is insane. I have to speak up. I have

an investment to protect and a country I love, because my mother

was born there. I'm doing a great service to Scotland. Because

Scotland is going to be destroyed if this litter is allowed to be

built all over its coast. Donald Trump, thank you. Thank you. Now,

the stage is set for a serious legal battle between the people who

used to run the Royal Bank of Scotland and a group of

shareholders who think they were conned out of �12 billion just

before the bank collapsed. Court action is being planned on behalf

of individuals and institution which bought into the Royal Bank's

special issue of new shares, which was designed to raise new capital

to tide the bank over a difficult period. And we all know how that

ended. It is called a rights issue. A company wants to raise capital,

so it offers new shares. Often at a discounts, to existing share horls.

Like any issue, there are a lot of rules and the main thing is the

prospeck us the must be honest and fair. The problem with the RBS

issue in 2008 is that it was followed less than six month later

by the failure of the bank, which was only saved from closure by

Government intervention. Did nobody know there was trouble brewing?

They in a document suggested that 12 billion would sort out all their

problems. They were fully aware by all accounts, and I have read the

letter o' claim, took me three hours to go through it, in great

detail and it appears from that letter, that there were many

examples of evidence that they knew full well that that would be

inadequate. The RBS share holders' action group reckons it is unlikely

in the extreme that everyone in authority in the bank was of the

opinion that everything was fine. So they're threatening to go to

court to recover their share of the 12 billion. When you have a rights

issue, you have to sign an agreement that you will not go back

to your shareholders, for at least a year, and they went bust within

five months. So the shareholders have every right to feel aggrieved.

And some people lost their life savings on this and it is a serious

affair. The bank responded by saying it has substantial and

credible legal and factual defences to the claim and will defends

itself vigorously. -- defend itself vigorously. One part of claim is

the acquisition of the bank ABM AMRO. The bank presented this in

glowing term, although insiders described it as a disaster. And

there was talk of borrowing that was not revealed. I'm joined by

Iain Fraser who broke the story. Why has it taken share holes so

long to bring these action? -- shareholders. I think they thought

the Financial Services Authority would do a better job of

investigating the matter. As you know, the Financial Services

Authority, its main role is to police the city. But the view, well

they were depending on it to produce a thorough report

investigating the matter, whether or not shareholders were misled.

But the part of the report into the RBS that was publiced -- published

in December, it was supposed to be published earlier, it didn't seem

to tackle this issue. Once the report came out, it was

disappointing. And they then decided I think to proceed with the

legal claim. Problems of this sort don't come around often, is there

any historical example of an action of this sort and if so how did it

turn out? I don't know of an exact comparison. Although you can think

back to the City of Glasgow back in 1873 where within one year the

entire board, or certainly a number of directors, were in jail. That is

a... A parallel. But it is a long time ago and a different

environment. I am not aware of an action such as the one which these

people are proposing. What happens now? Well I think the board, the

board of directors who were running the bank in 2008 have 90 days to

respond to the allegations which are in the letter o' of claimment

and the bank itself, the current bank has 90 days to respond to

these allegations. And if they don't respond to the satisfaction

of the people who are putting forward the claim, who represent

large institution s and small investors, then they will proceed

with a court case in the High Court in London. They will be seeking at

least �2.4 billion, but possibly more. Obviously, they have put

together a case and the bank says it will defend itself, we have yet

to hear from them, but what the -- but what is the whistle blowing

culture like in these banks? There doesn't seem to be whistle blowing

culture. There was one guy called Paul Moore, who emerged in HBOS and

opened a lot of internal practices that were not known and the risk

management failures, but within RBS there are... There is no equivalent

to Paul Moore, who has come out and stated that risk management

processes that were inadequate or auditing was. There is evidence to

suggest that these things were inadequate within RBS. There is a

guy called Clive Adamson, a former Executive with the Financial

Services Authority, who apparently stated to an author that RBS's

disclosures in 2008 were a pack of lays. He discovered this when he

was working for the Financial Services Authority. -- pack of lies.

But he was sat upon and not able to reveal or release the information,

because if the FSA had publicised the fact that RBS's mandate were a

pack of lies, it would have undermined the way it was

regulating the banks. shareholders feel they have been

coned, isn't it possible that those at a bank which made so many

disastrous decisions, seemingly blind to the consequences may have

asked for shareholders to buy more shares, without knowing the real

dangers? Sorry could you repeat the question? I wonder if it is

possible that the share rights issue could have been made without

any knowledge of the difficulties to come? I don't believe that is

possible. I believe that the board of directors were much more aware

of the trouble in which their bank found its and they were aware of

trouble in which ABM AMRO found itself and they were hiding this

information. That is what a court case like this is justified in my

vau. Thank you. -- in my view. Now, three out of four Scottish

political parties have had their Spring conferences and the Prime

Minster has already told us what he thinks about the constitution. So

you'd think everyone's position is now completely clear as to what the

referendum should be about. It's not, however, as simple as that.

Shortly I'll be hearing from a leading authority, first David

Allison reports. Over the past two weekends Labour and the SNP have

been in spring conference mode. No surprises that constitutional

change has been top of the agenda. One way or another. Let me tell

Alex Salmond something. Putting Saltires around his fire place is

no proof that he is putting Scotland's interest first, and

there is one thing we are good at - spotting a con man when we see one.

Labour along with the lest -- rest of the anti-independence campaign

have a lot of catching up to do with the SNP, who are riding high,

both in term of party membership and their campaign war shest chest.

Home rule with independence, beats Tory rule from Westminster any time.

So the party faithful have been lapping it up, despite a host of

unanswered questions from both sides. In the real worlds, away

from the weekend conference venue, others are trying to work out what

this means in practice. We know there will be a referendum, but

what question will it ask? How many questions will there be? Its up for

grabs. Can I welcome you to this meeting? At Westminster, the

unionist party come dominated Scottish affairss committee is

holding an inquiry on what they call referendum on separation for

Scotland. Last week they heard from distinguished political scientist

and pollsters and asked if Devo Max should be a referendum question.

seems from opinion poll evidence this is the option most Scots

favour. It would be odd in an instrument designed to discover

what Scottish people think to exclude the option that they most

favour. But aren't these things undefined. What we're coming to is

an understanding as the terms of this potential independence are

being redefined, week-to-week and day-to-day by the Scottish

Government and I don't blame them that, there would be an element of

pig in the poke, even with a vote for independence. The result likely

to be the subject of negotiations, should people get a second

referendum? If there is a referendum, we know what no means.

But we are not sure what yes means. If you were to have then a post

referendum referendum you could gate question majority the first

time and a no the second. So many questions, so few answers. John

Curtis know no stranger to this programme, offer one way out.

first indeed have the straight clear question that everyone seems

to agree they want, which is do you want Scotland to become independent.

Then you can have the seconds question, or if you want you have

have a second referendum and there is a more of a an argument, that

says if Scotland remains part of the United Kingdom, do you want to

have devolution Max or the status quo? The experts agreed the second

question was possible, but the question for Labour, the

Conservative and the Liberal Democrats is what to do about it.

If anything. With just over two and a half years until the referendum,

the next major test for the parties is over places like this, Glasgow,

what you hay may say do council elections have to do with the

constitution? Not a lot, but that won't stop the parties. I'm joined

from Oxford by the University's Professor of Politics, Iain Maclean.

As you saw in the film, he was one of the academics giving evidence

about how many questions would make a good referendum. More than one is

advantageous? It has advantages? But it has down sides. The clip you

played had me talking about the advantages. But I think in

somewhere else in that hearing I talked about the down sides. Which

are? The down side, the biggest down side is supposing you got a

vote yes for independence and a vote yes for Devo Max, what happens

then. The Scottish Government would say that is a vote for independence.

The UK Government would say, hang on, a higher proportion of the

Scottish people voted for something else. And none of us at the moment

know what that something else would be, or is. Which is another reason

why although as you saw I said to the committee, that it seems on one

way of looking at it odd to exclude the option that most Scots seem to

wants. Is Devo Max, Dee Voe plus or Dee Voe more, a package short of

independence definable? One has been defined by the Calman

Commission that was commissioned by the previous Government and has

been adopted by this UK Government. That is devo more and that is

something we know. Some people say it is not enough and they want devo

more, more and maybe devee max. And so somebody has to say it means the

following taxes will be devolved and the following spending areas.

There is the devo plus package. Well yes, slightly fewer taxes.

it should be possible to define whatever package is offered? Yes,

it should. If that is possible, and it did go on the ballot paper with

independence, how do you get around the problem that you have raised

about what happens if both options get a positive majority yes vote?

That is one of the easier questions. Because there are ways of doing it

which haven't been tried in the UK but they're perfectly robust. That

is you take each of the options against each of the others, like a

round Robin tournament, everyone plays everyone else and you see

which one beats all of the others. Now of course if known beats the

other, you go around in circles and that is a problem F you don't have

that problem, you would come up with an option which would beat the

others. Are you talking about multiple choice or having a gate

way question for constitutional reform yes or no and a second

question testing independence against devolution more in the vent

that people say yes to change? would prefer it to be all on the

same ballot paper. So the options would be set out, independence and

there would have to have been some booklet that said what independence

would involve. Doe Voe -- Devo Max and that must be propose and you

should say what it is involves and a note that it takes two to play

devolution and there would have to be a Westminster response and then

no to both that would involve the the present UK Government. Doesn't

this get confusing for you and I, never mind all the many thousands

and millions who are being zod vote and don't follow this - being asked

to vote and don't follow this story. Yes that is one of the argument

that people who want the straight up and down votes use. What do you

say to those who say more devolution in whatever form and

independence are similar pill my of a different -- are simply of a

different magnitude, one is about independence and one is about

changing the relationship with the state that is is currently part of?

Yes this is moving fast. The Scottish Government has been

recently fleshing out its vision and it seems that independence is

not as complete as people may have thought. Keeping the monarchy,

keeping the currency and now going for some defence agreement with the

UK. But the full transfer of sovereignty, how much of it you

wish to pool thereafter is political independence, and is of a

different Mag dude to devolution more? The Scottish Government says

that, but I have a difficulty in seeing that. What is the complete

transfer of sovereignty if you're going keep the pound sterling? You

have not completely transferred sovereignty, because you don't

necessarily have control over that southern si. I'm not saying I'm for

it or against it. -- currency. I don't see it as a complete transfer

of sov - o' sovereign si. Thank you. Now a quick look at tomorrow's

front pages. The Daily Mail, Lockerbie bomber's drug is refused

for slats. The Scotsman has the same story. The drug has been found

in clinical trials to extend the lives of prostate cancer patients.

That's all from me. If you want to see the programme again it's on the