Maureen Stronach, an employee at Diageo's Dalwhinnie distillery views whisky drawn from a cask in the store room
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Scotch whisky producers raised a dram to “stability” following Scotland’s vote to remain part of the UK but voiced caution about the implications of further devolution on the £4.5bn industry.

London-based Diageo, the Johnnie Walker maker that is the world’s biggest producer of Scotch, warned against higher taxes or more regulation, saying such measures could put the spirit at a competitive disadvantage to the fast-growing thirst for other whiskies, including American bourbon and Irish whiskey.

“Now that the people of Scotland have voted to remain part of the UK, we will continue to focus on what matters for our business as the implications of further devolved powers become clearer,” Diageo said on Friday. “The future for this sector will remain bright provided there is no further regulation or taxation on the industry.”

Apart from the risk of higher taxes, the industry’s main fear has been the threat to exports posed by the potential loss of EU membership had Scotland voted to quit the UK. Nine out of 10 Scotch whisky bottles are exported.

William Grant and Sons, the family-owned producer of Glenfiddich malt whisky, was so worried about losing the “substantial support” from the UK government and its worldwide embassy network, that it outed itself as an anti-independence supporter in July by donating £100,000 to the Better Together campaign.

David Frost, chief executive of the Scotch Whisky Association, the main industry body, said on Friday that the referendum debate underlined the need for collaboration between government and business on long-term economic challenges.

“We will be looking closely at plans for further devolution within this context. There must now be a renewed focus on improving the business environment.”

France’s Pernod Ricard, which owns Chivas Regal and The Glenlivet malt, and is the second largest Scotch producer, urged “all stakeholders to refocus on improving further the business, regulatory and export environment for Scotch whisky.”

The Paris-based group said it would: “continue to make major investments for the future.”

In Broxburn, 12 miles outside Edinburgh, Mike Younger, finance director at Macleod Distillers, an independent producer and maker of Glengoyne Single Malt, was pleased to be tearing up plans to move the company’s borrowing arrangements to England.

The contingency planning was based on the uncertain outlook for interest rates and availability of credit in an independent Scotland.

“I am greatly relieved,” he said. “I welcome a result which means that the business environment remains stable and predictable. It will allow us to continue to develop the business within the supportive environment of the whole UK.”

Copyright The Financial Times Limited 2017. All rights reserved.
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