Wednesday, 4 April 2012

Profits Galore! Is Whisky Growth Good For Scotland?

It seems hardly a week goes by without some good news about Scotch whisky to cheer us.

But for quite a while I’ve been nursing my dram and furrowing my brow and wondering why no-one seems interested in the reality. The quaint image marketed to the world bears no relation to what’s going on.

Whisky may be a simple blend of water and barley made in historic buildings in hidden glens and islands but it’s pretty much completely owned by foreign firms.

The figures that get trumpeted are usually export values – this is the price being paid, not the volume and not the value to the Scottish economy or local communities.

Today we learn annual profits for Pernod Ricard, owners of the Chivas brands, have remained steady at around the £200m mark. They own twelve distilleries including the wonderful cutie-pie Strathisla in Keith and one of my favourite sherry-Speyside malts Glenlivet.

Directors’ pay and bonuses went up by over half a million pounds, with one lucky chap (I’m assuming it’s a chap) getting a bump from 900k to £1.2m. Trebles all round!

As this recent excellent investigation by Colin Donald in the Sunday Herald showed only 16 per cent of the whisky industry is owned by Scots; the majority is split between a handful of multinational drinks and luxury brand firms. Jobs in the industry fell by six per cent in 2010 and volume of sales was down two per cent.

And there’s plenty of haziness (not induced by distillery vapours) around what these massive corporations pay in tax.

By contrast there’s increasing interest in craft beer, real ale and the idea of the local pub as a community asset worth protecting. Today’s news included a story about a wee Shetland brewery doing well. And we’re in the midst of community pubs month, organised by CAMRA.

Why do we make life easy for big business and not for small firms, who are more likely to support local supply chains, have a smaller environmental impact and recirculate profits in the local economy?

Here’s a cider producer in East Lothian making great stuff on a modest scale but facing a massive tax hike.

I for one will be considering who benefits from my choice of refreshment. It’ll always be hard to say no to a wee Glenlivet when offered but when it comes to lining my own drinks cabinet (younger readers should ask a grown up what that is) I’ll be trying to do it with products that don’t just line the pockets of multinational conglomerates.

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