By 2020, the UK could be a very different place; or not. The Scottish vote for independence will take place in 4 months’ time, on September 18th; an EU vote has been promised under certain conditions. The Scottish vote is also the first vote in the UK at which 16-18 year olds will have a vote, making it a far more unpredictable vote relative to any previous elections.

If both referendum votes support change, there could be no Scotland in the UK and the UK out of the EU; or the UK could still be with Scotland but out of the EU; or the same as now, only different. The political and economic uncertainties arising from these votes are enormous.

The Scottish polls have been showing a closing gap between the two sides, but huge levels of uncertainty about the outcome remain. The Better together/ no campaign remains in front with a fairly steady 42%, with Yes to independence gaining ground as the number of Don’t knows falls to 29%. One deciding factor may be the size and profile of the turnout. According to recent polls, many of the undecided feel they do not have enough information to make a decision. How or even if they vote will be crucial.

The result of the Scottish vote is unclear as are the impacts. Here are a few indications.

A long period of uncertainty during negotiations. March 24th 2016 has been designated Scottish Independence day. Many commentators however feel that negotiations on a growing number of issues will take far longer than 18 months to finalise. Tax, regulatory and investment uncertainty could continue and have damaging effects; or be a source of optimistic risk taking.

A financial exodus? Scotland has a major financial sector; companies are expressing concern about the period of uncertainty. Some are making contingency plans; pundits are suggesting others such as Lloyds and RBS will relocate. Still others are saying that independence will create an opportunity for many new jobs in finance.

Whose oil is it anyway? The SNP says North Sea Oil belongs to Scotland, because 90% falls within its ocean boundaries, and therefore so too should the revenues. The question will be on what grounds the divisions are made –location in the ocean, in which case Scotland owns 90%; or population, in which case Scotland is due less than 10%. Big money is at stake. So far, UK tax coffers have received £300 billion from North Sea taxes, and there are at least 15-24 billion barrels in reserves, maybe more. Negotiations will be tough; the impacts on either countries' ability to fund services high.

Electricity uncertainty too. Scotland aims to have 100% renewable energy by 2020. It is soon to be home to the 3rd largest wind farm in the world and has 25% of Europe’s wind and wave power. Some argue that it also receives significantly higher subsidies for renewables than its relative share of energy sales, meaning that Scottish bills could rise after a yes vote. Others suggest that changes in the energy market could result in brownouts in the UK.

Who pays the debt? By 2016 the UK national debt has been estimated to be £1.5 trillion. Scotland’s share of that has been put variously at £122 billion, £56 billion – or nothing. How much of the national debt Scotland needs to take on will affect both countries.

Defence dilemmas. A yes vote was described as potentially cataclysmic recently, that it would weaken the UK’s international standing and role, and also potentially that of NATO. The Trident nuclear subs would need to be relocated, the number of defence jobs in Scotland might fall sharply. The SNP argues otherwise.

What currency? The UK political parties have ruled out Scotland keeping the pound; the SNP – and an unknown senior UK MP – say otherwise - that negotiations would go ahead out of the UK’s self-interest. Or, Scotland could just use the pound, regardless.

A range of organisations are beginning to voice concerns about the uncertainties surrounding the outcome of the Scottish independence vote and any transition period. What is increasingly clear is that in the event of a yes vote, politicians’ and companies’ attention will focus heavily on negotiations and the implications of a vast array of issues, over and above those listed here. Political, corporate and investment decisions could end up on hold in the meantime. Even if the vote is for no, there are likely still to be major negotiations about increased devolution and local control.

Companies need to think through how the Scotland yes vote might affect them, what contingencies they need to put in place. The same applies to any possible EU vote. Please contact us if you would like us to help you think through some of the impacts and implications for your organisation.