Blend that rescued Scotch from rocks

Patrick Tooher looks behind the Chancellor's U-turn on whisky tax

THE CHANCELLOR'S unexpected largesse to whisky makers was one of the few surprises in an otherwise lacklustre Budget. Only the day before the 4 per cent reduction - equivalent to 27p on a 70cl bottle of Scotch - Brian Ivory, chief executive of Highland Distilleries, the Famous Grouse whisky group, told journalists that a tax freeze was the best that could be hoped for.

What Mr Ivory had underestimated was the influence of the powerful Scotch Whisky Association, the lobby group of which he himself is a council member.

The SWA denies it made a special effort this year to twist the Chancellor's arm, arguing that Kenneth Clarke was ultimately persuaded by the sheer force of the industry's argument to reverse last year's tax rise.

"Nobody was winning," argues Rebecca Tabor of the Communications Group, a lobbying group which advises the SWA. "The Treasury was losing money and an important UK business was being harmed."

Economics undoubtedly played a big part in the Chancellor coming round to the whisky industry's view. After all, the tax take from whisky actually fell by pounds 54m in the six months since whisky duty was raised in last year's mini-Budget because of shrinking demand. And Mr Clarke clearly accepted the notion that high levels of whisky duty - twice as much as those imposed on imported wine - discriminated against one of Britain's biggest export earners.

But the equally powerful brewing lobby, which had campaigned hard for similar reduction in beer and wine duty to combat cross-Channel "booze cruises", failed to get more than a tax freeze. So why then was the whisky lobby alone successful this time round? One reason may have been its change of approach to the Chancellor.

"In the past the Scotch Whisky Association and the industry have tended to be very negative," says Mark Hunt, corporate communications manager at Allied Domecq, which owns Teacher's whisky. "It is very easy to sit there and whinge about job losses and falling volumes."

Instead, Allied Domecq commissioned the Fraser of Allender Institute at Strathclyde University to study the impact of Allied Distillers on the Scottish economy. The findings showed that the Scotch whisky industry, which employs 14,000 directly but sustains almost 50,000 jobs in distilling and related industries, was more important to the Scottish economy than the Silicon Glen-based computer manufacturing industry or the finance, paper and pharmaceuticals sectors.

The report was sent to all MPs north of the border, including Scottish Secretary of State, Michael Forsyth, who is defending the ultra-marginal seat of Stirling. According to Mr Hunt, even Mr Clarke asked for a copy.

Pressure was applied from another quarter. So annoyed was Highland Distilleries with Mr Clarke's mini-Budget last year that it slashed its contribution to the Conservative Party from pounds 12,000 to pounds 4,000, and Allied Domecq stopped giving to the Tories altogether in 1993 - a loss to Smith Square of pounds 40,000.

But the SWA's traditional behind-the-scenes lobbying and leading delegations to see the Chancellor also paid dividends.

Surprisingly few MPs have a declared interest in the whisky industry. The SWA's only parliamentary consultant is Roger Sims, the Conservative MP for Chislehurst, who is standing down at the next election. The House of Commons Register of Members' Interests also shows that Michael Trend, the Tory MP for Windsor & Maidenhead, acts as parliamentary consultant to Grand Metropolitan's drinks arm, IDV. Meanwhile, the former secretary of state for transport, Paul Channon, the Tory MP for Southend West, and Sir Mark Lennox-Boyd, Tory MP for Morecambe and Lunesdale, are both part of the Guinness dynasty, which owns Bell's.

Not listed is the House of Commons Scotch Whisky Industry Group, mainly made up of Scottish MPs with whisky interests in their constituencies.

Their campaign was boosted by other high-profile politicians, including Lord Younger of Prestwick, the former defence minister and chairman of the Royal Bank of Scotland, and the veteran Tory backbencher Dame Jill Knight.

Having at last tasted success, the whisky lobby wants more. "The tax take on a bottle of whisky is still 65 per cent," notes the SWA's Campbell Evans. "At this rate parity according to alcohol content will take 14 years to achieve."

Mr Clarke's time horizons are somewhat shorter. His U-turn on whisky tax alone will not relaunch the Tories in Scotland in time for the election. He will have to go a lot further next time to drown Tony Blair in a torrent of beer and Bell's.

PROMOTED VIDEO
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmReview: A week late, Secret Cinema arrives as interactive screening goes Back to the Future
News
Chancellor George Osborne, along with the Prime Minister, have been 'complacently claiming the economy is now fixed', according to shadow Chancellor Ed Balls
i100... which is awkward, because he is their boss, after all
Travel
travel
Arts and Entertainment
Sydney and Melbourne are locked in a row over giant milk crates
artCultural relations between Sydney and Melbourne soured by row over milk crate art instillation
Arts and Entertainment
Adèle Exarchopoulos and Léa Seydoux play teeneage lovers in the French erotic drama 'Blue Is The Warmest Colour' - The survey found four times as many women admitting to same-sex experiences than 20 years ago
filmBlue Is The Warmest Colour, Bojack Horseman and Hobbit on the way
Arts and Entertainment
Preparations begin for Edinburgh Festival 2014
Edinburgh festivalAll the best shows to see at Edinburgh this year
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
i100
News
Kenny Ireland, pictured in 2010.
peopleBenidorm, actor was just 68
Environment
View from the Llanberis Track to the mountain lake Llyn
Du’r Arddu
environmentA large chunk of Mount Snowdon, in north Wales, is up for sale
Arts and Entertainment
arts + ents
News
Morrissey pictured in 2013
people
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Financial Analyst - Forecasting - Yorkshire

£300 - £350 per day: Orgtel: Financial Analyst, Forecasting, Halifax, Banking,...

Business Architect - Bristol - £500 per day

£500 per day: Orgtel: Business Architect - Banking - Bristol - £500 per day A...

Regulatory Reporting-MI-Bank-Cardiff-£300/day

£200 - £500 per day + competitive: Orgtel: I am currently working on a large p...

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Day In a Page

Dress the Gaza situation up all you like, but the truth hurts

Robert Fisk on Gaza conflict

Dress the situation up all you like, but the truth hurts
Save the tiger: Tiger, tiger burning less brightly as numbers plummet

Tiger, tiger burning less brightly

When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

In grandfather's footsteps

5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

Martha Stewart has flying robot

The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

Do women cyclists need 'pootling lanes'?

Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

A tale of two presidents

George W Bush downs his paintbrush to pen father’s life story
Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

The dining car makes a comeback

Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

Gallery rage

How are institutions tackling the discomfort of overcrowding this summer?
Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

Eye on the prize

Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

Women's rugby

Tamara Taylor adds fuel to the ire in quest to land World Cup
Save the tiger: The day America’s love of backyard tigers led to a horrific bloodbath

The day America’s love of backyard tigers led to a horrific bloodbath

With only six per cent of the US population of these amazing big cats held in zoos, the Zanesville incident in 2011 was inevitable
Samuel Beckett's biographer reveals secrets of the writer's time as a French Resistance spy

How Samuel Beckett became a French Resistance spy

As this year's Samuel Beckett festival opens in Enniskillen, James Knowlson, recalls how the Irish writer risked his life for liberty and narrowly escaped capture by the Gestapo
We will remember them: relatives still honour those who fought in the Great War

We will remember them

Relatives still honour those who fought in the Great War
Star Wars Episode VII is being shot on film - and now Kodak is launching a last-ditch bid to keep celluloid alive

Kodak's last-ditch bid to keep celluloid alive

Director J J Abrams and a few digital refuseniks shoot movies on film. Simon Usborne wonders what the fuss is about
Once stilted and melodramatic, Hollywood is giving acting in video games a makeover

Acting in video games gets a makeover

David Crookes meets two of the genre's most popular voices