:00:00. > 3:59:59Who would win? My money is on the All Blacks? The All Blacks would
:00:00. > :00:13.win! They are petty unbeatable. Tonight on Newsnight Scotland: Would
:00:14. > :00:17.independence really mean your grocery bills would go up? The big
:00:18. > :00:21.supermarkets have hinted they might, then that they might not. Are they
:00:22. > :00:25.just after a tax break? And how do they cope in Ireland,
:00:26. > :00:29.living on a land border between the UK and another EU state?
:00:30. > :00:31.Good evening. Earlier this week, the ASDA and Morrisons supermarkets told
:00:32. > :00:35.the Financial Times newspaper that independence might mean higher food
:00:36. > :00:38.prices in Scotland. Today, the idea of a dearer Scottish loaf was
:00:39. > :00:41.roundly dismissed by the First Minister, and some of those same
:00:42. > :00:44.supermarket bosses have hastily insisted a change in the business
:00:45. > :00:47.regime here could result in prices falling. So, would a border between
:00:48. > :00:56.England and Scotland really have any effect on your bill at the checkout?
:00:57. > :01:02.It was either a blatant scare story, or a realistic assessment of the
:01:03. > :01:05.costs of change. We are used to the supermarkets promising us the lowest
:01:06. > :01:09.possible prices so to hear them threatening that goods could cost
:01:10. > :01:12.more struck a rather discordant note. Not least because it sounded
:01:13. > :01:16.like an intervention in a decision that is for Scots' voters alone to
:01:17. > :01:19.make. The argument went that the market would be smaller and
:01:20. > :01:23.overheads would be higher in an independent Scotland. Would it be
:01:24. > :01:26.fair to pass those charges on to consumers in the rest of the UK? Of
:01:27. > :01:44.course, that is what happens at the moment. Writing today in the Herald,
:01:45. > :01:48.Andy Clarke stresses the economies... And he is careful to
:01:49. > :01:52.stress that he is not arguing on either side of the independence
:01:53. > :01:59.debate. And that price rises are not inevitable in an independent
:02:00. > :02:02.Scotland. Today, Morrisons, one of the major chains reported to have
:02:03. > :02:06.been behind the original story, were keen to distance themselves from
:02:07. > :02:11.accusations of meddling in Scottish politics. If the costs in Scotland
:02:12. > :02:15.were to increase, say if taxes were increased, or if there was lots of
:02:16. > :02:19.different and extra legislation which added cost to stores, we would
:02:20. > :02:23.have to look at that in the context of an independent Scotland.
:02:24. > :02:26.Likewise, the Scottish Government in an independent Scotland might choose
:02:27. > :02:30.to make the costs of doing business much lower and, of course,
:02:31. > :02:42.therefore, we would expect pressures on us to lower prices to reflect
:02:43. > :02:46.that fact. Can I ask the First Minister what the Scottish position
:02:47. > :02:49.is... At First Minister's Questions today, Alex Salmond was able to
:02:50. > :02:53.dismiss the whole thing as a scare story. Far from food prices rising,
:02:54. > :02:58.because of independence, the truth of the matter is they are rising
:02:59. > :03:04.within the UK at the present moment. The latest stats on food price rises
:03:05. > :03:11.for the year to October showed the prices in the UK are the fourth
:03:12. > :03:16.highest in the OECD. One of the problems of any legislation, or any
:03:17. > :03:20.difference... The reality is that already today under devolution and
:03:21. > :03:23.regardless of the outcome of next September's referendum, the rules
:03:24. > :03:27.and regulations in force here are becoming more and more different
:03:28. > :03:31.from those that apply elsewhere in the United Kingdom. If you look at
:03:32. > :03:37.devolution and look at the devolved country, there's been a series of
:03:38. > :03:43.differences across the countries. So, we have had differential pricing
:03:44. > :03:47.in terms of plastic bags. The Scottish Government has put a levy,
:03:48. > :03:52.a health levy on large retailers who sell tobacco and alcohol, on the
:03:53. > :03:56.rateable value, so that's increased the cost of doing business up here.
:03:57. > :04:00.We have different regulations with alcohol in Scotland, tobacco in
:04:01. > :04:04.terms of how you can present tobacco and alcohol. Therefore, what
:04:05. > :04:07.marketing you can do in terms of those products within Scotland. So
:04:08. > :04:13.there's been a divorce in many ways of some of the activities that
:04:14. > :04:17.retailers used to be having across the UK. Now there are separate
:04:18. > :04:20.things going on. Like the value of stocks and shares, the costs of
:04:21. > :04:24.doing business in Scotland may go down as well as up. But you can be
:04:25. > :04:29.certain there will be more stories like this in the months to come. The
:04:30. > :04:34.unexpected items in the bagging area of Scottish politics.
:04:35. > :04:37.Now, shortly, we'll look at how business copes with the border
:04:38. > :04:40.between Northern Ireland and the Republic. But first, I'm joined by
:04:41. > :04:43.Gordon MacIntyre-Kemp of the organisation Business for Scotland,
:04:44. > :04:46.campaigning for a "yes" vote. And in Edinburgh, a businessman who runs a
:04:47. > :04:52.group of shops, and supports Better Together, Daniel Johnson. Daniel
:04:53. > :04:58.Johnson, this has non-issue written all over it, doesn't it? I don't
:04:59. > :05:03.think so. I think the person in your clip there summed it up quite
:05:04. > :05:06.neatly. We already know we have had complexity from devolution. I think
:05:07. > :05:10.if Scotland were to become independent, we would have to be
:05:11. > :05:15.looking at what might happen in terms of different regulations,
:05:16. > :05:20.different taxes, different regimes. Maybe different currencies. That
:05:21. > :05:24.complexity adds cost to business and in retail, those costs will end up
:05:25. > :05:28.being passed on to consumers as the supermarkets have been saying. Yes,
:05:29. > :05:33.but it depends what these changes are. It is as easy to envisage
:05:34. > :05:40.changes that could mean that prices would go down, so the only argument
:05:41. > :05:43.is to say there's something intrinsically about Scotland being
:05:44. > :05:49.independent and being a smaller country that would mean prices would
:05:50. > :05:53.go up? No, I think - if you listen to what I was just saying - the
:05:54. > :05:57.moment you have two systems, you are going to introduce complexity. For a
:05:58. > :06:02.retailer like me, who is small, if you are having to deal with two sets
:06:03. > :06:05.of regulations, maybe two sets of currencies, that is quite a
:06:06. > :06:10.complicated thing to have to deal with. It's that complexity, the
:06:11. > :06:17.administration required to administer different regimes, which
:06:18. > :06:21.is going to add cost to customers. Right. Gordon MacIntyre-Kemp, the
:06:22. > :06:28.problem for you, while the people who support the "no" campaign seize
:06:29. > :06:38.on this stuff and say, "Your grocery bills are going to go up" the "yes"
:06:39. > :06:43.campaign say, "No, they won't." To get to the core truth of this
:06:44. > :06:47.matter, no supermarkets have said they have any plans to raise prices
:06:48. > :06:54.in an independent Scotland. Morrisons have said that prices
:06:55. > :06:58.could go down with the right regime. What nay have said is that transport
:06:59. > :07:01.costs for fresh food are more expensive in Scotland and after
:07:02. > :07:04.independence, should it happen, they would run their business in Scotland
:07:05. > :07:10.differently from the business in the whole of the UK, so that UK
:07:11. > :07:15.consumers would no longer subsidise the extra costs involved in
:07:16. > :07:20.Scotland. I spent about seven years of my career dealing at head office
:07:21. > :07:25.level with ASDA and Morrisons and it is true that it does cost more to
:07:26. > :07:30.deliver food to Orkney or to Aberdeen from Leeds, but it also
:07:31. > :07:34.costs more to deliver it to Cornwall or to the Lake District than to
:07:35. > :07:37.Leeds. Their point is if Scotland was independent, they would run
:07:38. > :07:41.their business in Scotland separately and would not have
:07:42. > :07:46.cross-border subsidies in the way they do at the moment? For a start,
:07:47. > :07:49.it's been said in an interview with the Huffington Post, Morrisons said
:07:50. > :07:54.that it would depend on the direction of travel and Scotland
:07:55. > :07:58.would have the ability to make it a more fairer environment for
:07:59. > :08:02.retailers to operate in. If you look at the direction of travel, the
:08:03. > :08:09.White Paper that's come out from the Scottish Government states that
:08:10. > :08:13.there will be a 3% corporation tax cut. There have been freight
:08:14. > :08:17.services grants from the Scottish Government already which amounted to
:08:18. > :08:21.?4 million that Tesco and ASDA have used to start distributing by rail
:08:22. > :08:25.rather than road and cutting costs. So, basically, the powers are there
:08:26. > :08:30.in an independent Scotland to create a situation where the cost of living
:08:31. > :08:35.could go down and Andy Clarke, the Chief Executive of ASDA, has said he
:08:36. > :08:40.is open to have meetings with Scottish politicians. Right. Daniel
:08:41. > :08:43.Johnson? By the same token, Morrisons are saying - and you are
:08:44. > :08:47.saying that Morrisons say that prices could go down. They are also
:08:48. > :08:51.saying that if the cost of doing business in Scotland goes up, they
:08:52. > :08:56.will pass those costs on. I think you can't... They won't go up. There
:08:57. > :09:04.is no real reason for them to go up. Well, I think the distribution
:09:05. > :09:09.costs... They will stay exactly the same. Why would they pass them on to
:09:10. > :09:13.a different jurisdiction? It is like saying customers in France will
:09:14. > :09:17.subsidise the transportation costs in Finland. That doesn't happen. I
:09:18. > :09:24.don't see why businesses would be doing that under independence in
:09:25. > :09:29.Scotland. It doesn't make sense. You can't say the prices might go down
:09:30. > :09:34.and that they might go up as well. I can guarantee they have been going
:09:35. > :09:41.up in Scotland and across the UK. Anyone who goes to Morrisons or ASDA
:09:42. > :09:45.and buys the family shopping will see we have had a 4% increase in
:09:46. > :09:49.food inflation in the UK over the last year. That's double that of
:09:50. > :09:55.Norway, three times that of Sweden and in Denmark, small, independent
:09:56. > :10:00.country that doesn't speak the same language or use the same currency,
:10:01. > :10:04.food price inflation has decreased. So being a small independent nation,
:10:05. > :10:09.how come they are doing better than Great Britain? It doesn't make sense
:10:10. > :10:13.to say that just because you are smaller. If you are smaller and you
:10:14. > :10:17.have the economic levers, you can create a better environment for
:10:18. > :10:24.business and that has been said over and over again by the Scottish
:10:25. > :10:28.Government. Alright. Let Daniel Johnson get a word in. I think it
:10:29. > :10:35.comes back to the same point. It's got nothing to do with being
:10:36. > :10:43.smaller. It's got to do with Scotland being a lot furtherer away
:10:44. > :10:47.in the markets. There have been allegations that some businesses,
:10:48. > :10:52.not just in Scotland, but big companies are afraid to speak out on
:10:53. > :10:59.this issue because they might get lambasted by the Scottish
:11:00. > :11:10.Government, or by people at the shops. Can you both agree that it
:11:11. > :11:15.would be a good thing if the Max maximum number of businesses... That
:11:16. > :11:19.is why I'm very pleased to be talking on the programme tonight. I
:11:20. > :11:23.thought you would be. Are you? Business for Scotland has over 1,000
:11:24. > :11:32.members. Businesses are coming forward. They are willing to speak
:11:33. > :11:37.out in favour of independence. You would like those who are not in
:11:38. > :11:41.favour to speak out as well? They are not willing to go on television
:11:42. > :11:45.and try and back up ridiculous scare stories like this. Alright. Don't go
:11:46. > :11:50.away. We will bring you back in a moment if we have time.
:11:51. > :11:53.Now, our reporter, Ian Hamilton, has been to Ireland, home to a land
:11:54. > :11:57.border between a constituent part of the UK, and a separate state which
:11:58. > :12:00.is part of the EU, and indeed the eurozone. There's a free travel area
:12:01. > :12:11.between them, but the Republic of Ireland is not part of the European
:12:12. > :12:19.Schengen free travel area. As I leave Scotland, and -- I am on
:12:20. > :12:22.the road in the search for the UK's only international land border.
:12:23. > :12:29.Sounds easy? You would think so. According to some in the better
:12:30. > :12:33.together campaign, if Scotland votes yes next year, we could have
:12:34. > :12:38.security guards and custom posts along the border between Scotland
:12:39. > :12:44.and England. But according to the yes campaign, it does not have to be
:12:45. > :12:52.that way. I am in Newry, a business -- a busy
:12:53. > :12:55.border town in Northern Ireland. It is suggested that if Scotland votes
:12:56. > :13:00.yes next year, this is a good example of the sort of border
:13:01. > :13:05.Scotland could have with England. This border was once much tougher
:13:06. > :13:12.due to the troubles. But today, the border is quite different.
:13:13. > :13:15.Since 1923, there had been a Common travel area between the United
:13:16. > :13:19.Kingdom and the Republic of Island. There was only one break in this
:13:20. > :13:24.agreement, during the Second World War. Anyone holding a United Kingdom
:13:25. > :13:27.passport or someone from the Isle of Man, the Channel Islands or the
:13:28. > :13:32.Republic of Arles and can travel freely within this area without
:13:33. > :13:37.showing that passport. -- Republic of Ireland. The yes campaign say
:13:38. > :13:41.there is no reason why it is an independent Scotland should not be
:13:42. > :13:55.part of this same Common travel area.
:13:56. > :14:00.This is a good model, which has allowed a lot of labour mobility
:14:01. > :14:08.across the border. The borders and smacked the barriers and challenges
:14:09. > :14:17.arrived on things like taxation and regulatory issues. These are
:14:18. > :14:24.barriers that in a sense could or should be sorted out.
:14:25. > :14:31.Joseph is in the rubbish business, bringing in waste from all over
:14:32. > :14:34.these islands. The likes of our business, because it is waste, the
:14:35. > :14:39.border is very much there, everything that comes across much be
:14:40. > :14:44.recorded, and it has to be shown exactly on time so that the people,
:14:45. > :14:49.the regulators can know exactly what happens. I can take waste from
:14:50. > :14:52.London and are not have to notify the authorities, but if I take it
:14:53. > :14:57.from the South of Ireland, I have to.
:14:58. > :15:07.This causes Joseph a headache and a lot of money. The lack of
:15:08. > :15:11.harmonisation in the regulation of the movement of waste also causes
:15:12. > :15:16.problems, and this is between two EU members.
:15:17. > :15:19.We have been travelling around here trying to find the border between
:15:20. > :15:26.the Republic of Island and the North of Ireland, and so far, no luck. --
:15:27. > :15:30.Republic of Ireland. I am desperate to show my passport, but there is no
:15:31. > :15:33.one around. We gave up the idea of looking for
:15:34. > :15:39.the border, and moved six miles south.
:15:40. > :15:45.This is a massive frozen food distribution area, with enough space
:15:46. > :15:50.for 40,000 pallets. The food here will end up on dining tables across
:15:51. > :15:53.Britain and beyond. The owner of this business says the border six
:15:54. > :15:59.miles to the north of them does not cause him any difficulties. It is
:16:00. > :16:09.not a real problem. There are a few minor issues like this certification
:16:10. > :16:12.for veterinary purposes for products produced in Northern Ireland or the
:16:13. > :16:21.UK that are being exported to China or Russia, are countries like that,
:16:22. > :16:26.but generally there is free trade. There are no customs barriers as
:16:27. > :16:31.such. Everything flows on documentation.
:16:32. > :16:39.Another contentious area if Scotland votes yes, is policing. There are
:16:40. > :16:49.plenty of corporation between the police in the north and the Garda in
:16:50. > :16:53.the South. They cooperate. I am sure there is a little bit of unofficial
:16:54. > :17:04.or whatever, but generally they cooperate. What they did not have a
:17:05. > :17:08.common travel zone for themselves. If I was to rob a bank this
:17:09. > :17:16.afternoon, I could not get a clean getaway? ! That is a shame.
:17:17. > :17:24.Neither I -- I would not attempt to rob any bank on either side of the
:17:25. > :17:28.border. Like many things in this debate, the border between Scotland
:17:29. > :17:30.and the rest of the UK will come down to negotiation. The Scottish
:17:31. > :17:35.Government might be keen for it to become a member of the Scott --
:17:36. > :17:40.Common travel area, but will the rest of the UK? This might come down
:17:41. > :17:44.to what kind of deal Scotland can negotiate to be part of the European
:17:45. > :17:51.Union, and whether the rest of the UK vote to remain part of Europe.
:17:52. > :17:58.Gordon, you have had experience in this. Either price differentials, I
:17:59. > :18:08.think there were -- I thought there were. Milk and eggs seemed to be
:18:09. > :18:11.cheaper in southern and fun Northern Ireland but potatoes are cheaper the
:18:12. > :18:19.other way around, so it is pretty much the other -- the same. I have
:18:20. > :18:21.done business in Ireland, and across -- I crossed the border several
:18:22. > :18:26.times without noticing it. I asked my accountant before going to
:18:27. > :18:30.Ireland last year what would be the differences. He said, it is pretty
:18:31. > :18:35.seamless, there is a slight difference on tax. I will just put
:18:36. > :18:41.the VAT inbox eight rather than box for. I think if we get the
:18:42. > :18:46.regulations right, there is no reason for additional complexity,
:18:47. > :18:50.but without additional complexes team we will have the opportunity to
:18:51. > :18:56.create a business environment which could lower the cost of shopping in
:18:57. > :19:01.Scotland. What do you make of that, Daniel? There are a lot of ifs and
:19:02. > :19:07.buts. I have no doubt Scottish retailers will continue regardless
:19:08. > :19:12.what has happened, but we do not know what will happen. There will be
:19:13. > :19:18.additional regulations, and the people... The people dealing with
:19:19. > :19:23.rubbish were saying there were a lot of differences. You have got a chain
:19:24. > :19:29.of shops, are there any differences that would make a change to you? I
:19:30. > :19:34.have about 300 suppliers, most based on the rest of the UK. -- in the
:19:35. > :19:39.rest of the UK. The rest in continental Europe. When I am paying
:19:40. > :19:43.invoices for suppliers in Europe, I have to pay ?15 for every
:19:44. > :19:46.transaction. I do not have to do that for the rest of England. If
:19:47. > :19:51.that did happen, that would be pretty worrying. I pay hundreds of
:19:52. > :19:59.invoices every month, that would add thousands of pounds... But there is
:20:00. > :20:03.no reason why that would happen. We would look to maintain seamless
:20:04. > :20:08.control across the Borders. We would not have a separate currency. You
:20:09. > :20:13.must have a different version of the white paper to me, because mine did
:20:14. > :20:17.not have the chapter written by Nostradamus which said how the
:20:18. > :20:24.negotiations were going to go. On the balance of problem -- prog -- on
:20:25. > :20:27.the balance of probability, there should not be any more problems with
:20:28. > :20:33.an independent Scotland dealing with other countries in the world.
:20:34. > :20:38.You will have to continue this in your own time.
:20:39. > :20:45.Tomorrow's front pages. The Daily Mail, was fuelled Fox to
:20:46. > :20:56.blame in helicopter tragedy? -- fuel forked.
:20:57. > :21:02.-- fault. The Times, cheat speed crackdown on
:21:03. > :21:13.benefit -- claim fraud. That is all for tonight. Good night.
:21:14. > :21:16.Good evening. We are in for a mild night across the British Isles
:21:17. > :21:20.tonight. A thickening blanket of cloud will bring rain into most
:21:21. > :21:25.areas by Dawn on Friday, but overnight lows will be something
:21:26. > :21:30.like ten to 12 Celsius. The cloud and rain will work its way eastwards
:21:31. > :21:40.through Friday, allowing trier, brighter weather to come in. --
:21:41. > :21:46.drier. Generally much drier and brighter for Scotland. The same can
:21:47. > :21:54.be said for Wales and the south-west of England. The central and --
:21:55. > :21:57.central and eastern England, the rain on and off throughout the day
:21:58. > :22:03.and into Friday evening it could be wet as well. Ended and Wales, the
:22:04. > :22:11.weekend should be fine by day, Scotland and northern Ireland, in
:22:12. > :22:20.for a stormy spell. One area of low pressure arriving on Saturday, so
:22:21. > :22:24.you can see a much quieter story for England and Wales. Rain sweeps
:22:25. > :22:30.across England and Wales on Saturday night, out of the way on Sunday. But
:22:31. > :22:34.then our next front approaches on Sunday, bringing stronger winds.
:22:35. > :22:35.Potentially