Mind over money

Not surprisingly, given that this was an Eton-feeding prep school in the 1960s, the result was a crushing Tory victory.

Nevertheless, the pattern of Tulloch's successfully contrarian career was set. He joined the SNP at 17 and, although no longer a member ("I don't like being a member of any party, I find it difficult to agree with an awful lot"), he has remained loyal to the cause ever since.

It has mattered not a jot to him that in the various milieux of his life - Rugby School, Cambridge University, Hong Kong, the City and the classical squares of the Edinburgh financial sector - that his passion for independence has been seen as at best the tolerated eccentricity of a brilliantly intuitive and highly principled investment brain.

Tulloch maintains a strict demarcation between his private and professional personae, which means his views are not an issue with his employers, First State Investments. It can, however, lead to him being cut dead at smart East Lothian drinks parties, a subject which provokes his ready, raucous laughter.

The 64-year-old made the news in March this year, along with Sir George Mathewson, Jim Spowart and others, when he signed a letter to the Financial Times contradicting the mainstream industry group Scottish Financial Enterprise's (SFE) hostile views on independence, which they claimed "do not reflect the balance of opinion in the Scottish financial sector, nor provide an objective analysis of the opportunities and risks involved - whether a Yes or No vote is recorded".

Boiled down to its essentials, SFE's position is that Edinburgh is a major European financial services centre largely by virtue of proximity to the City of London, global capital of finance. The body fears anything putting obstructions and uncertainty in the way of that. These risks include potential disruption of the currency, the UK single market, EU membership and the single regulatory regime. Each is seen as a threat to a sector that provides 7% of Scotland's GVA (gross value added) and 200,000 jobs.

Tulloch has a very different vision of the Scottish financial services sector and, as his fellow financier Sir Angus Grossart said last week, he believes that the potential difficulties of the transition process have been much exaggerated.

"I personally think we will stay as close as possible to the City," said Tulloch. "Independence shouldn't make any difference to the relationship. If we had different currency and regulatory systems it would be more difficult, but I don't believe that that's the case, like the Government minister said, 'of course we will have a currency union'.

"I'm also absolutely convinced we could produce a regulatory regime every bit as good and probably quite a lot better [than London's] and probably not a huge amount of cost as well. An awful lot of the activities that need to be closely regulated in the City we don't do up here.

"For example, only three or four hedge funds are up here, while there must be hundreds in London."

More fundamentally, Tulloch believes there would and should be a more herbivorous character to an independent Edinburgh's financial sector, meaning that the our brand of capitalism should be radically tweaked. "I would much prefer to attract long-only funds, positively allocating capital rather than jumping in on short-term trends, my personal view is that [short-selling] should be abolished."

Tulloch claims to hate the "left and right thing", and his views - support for lower corporation tax, support for a mansion tax - sprawl unconventionally over large parts of the political spectrum, challenging what are often seen as fundamental market principles. "One of the things that has become quite clear over the last five years is that completely unbridled capitalism and unbridled institutions can do a lot of damage," he said. "The big corporate takeovers like Cadbury's takeover by Kraft, I don't see why just shareholders should be involved.

"There is a strong public interest in [market intervention] as there's an awful lot of companies at the moment, American companies trying to buy companies in the UK for tax reasons. This is terrible when you have other people's livelihoods and research bases impacted negatively in this country as a result of the tax regime in the States.

"One thing I would like to see being pioneered again in Scotland is all people in the industry taking a kind of Hippocratic oath [the ethical pledge made by doctors], administered by a body of reputable people in the profession, and if people thought that they had been abusing customers by selling them bad products, that person could be struck off. There should be something in addition to existing regulation.

"Credibility is terribly important for Scotland, and given that a huge amount of the money we manage is for overseas clients, there needs to be complete confidence in our regulatory system."

All Scottish nationalists have model countries and Tulloch's is Hong Kong, where he worked for three years in the early 1980s for the blue-blooded City stockbroker and investment bank Cazenove, following an unfulfilling period working as an accountant and -improbably - for the National Bus Company.

The then British colony, and its similar-sized competitor Singapore, showed him how dynamic and entrepreneurial a population of five million people could be. "It confirmed, I suppose, that independence was not only a nice thing to have, but it could work perfectly well and was worth fighting for."

Since his return to Scotland in 1988, what has led this manager of private wealth to believe that secession could infuse his nation with Hong Kong-style commercial dynamism?

"Having worked in business and seeing what the impact could be if you empower people, if you let people get on with things, make them responsible for things. If you put fences around people they tend to behave like sheep. Following this sort of mentality I feel that can do a tremendous amount in business terms with independence. One of the ways I would measure the success of independence would be the number of business start-ups in Scotland, and the question is how do we get there?"

Given the leftish tinge of modern "civic nationalism", conventional wisdom might not square it with the more libertarian vision of Tulloch and other very wealthy pro-independence businessmen such as the commercial property magnate Dan Macdonald. Their pro-business views can be broadly categorised as centre right, although with a strong emphasis on "fairness".

For Tulloch it is all about self-reliance, a national quality that he feels only independence can revive.

"I think that people will be prepared to do better if they feel they own the 'project'. At the moment they don't feel that, and it's too easy to sit back and just blame other people. There is this culture of trying to get as much money out of Westminster as possible instead of living within our own means.

"Making independence work would appeal to the vast majority of Scots. I don't think people really like this dependency culture. The current stereotype of the whingeing jock, and the whole anyone-but-England thing is a terrible mentality to be saddled with, and the only way we can get rid of that is by people being proud of what they are doing rather than denigrating others."

One of Tulloch's most cherished beliefs is that schools - especially in poorer areas - should be removed as much as possible from local authority control and run by autonomous head teachers, all run with the involvement of public-spirited local business people, and all competing among their peers to provide the best education possible for their pupils, including lessons in entrepreneurship.

Education is not just an abstract interest. He was one of those who, when the investment firm he had helped lead, Stewart Ivory, was sold to Australia's Colonial First State Investments in 2000 for £72m, part of that in generous bonuses for him and his colleagues, ensured that part of the payout went towards the endowment of a financial education charity the Stewart Ivory Foundation, which still gives effective practical personal financial lessons in Scottish schools.

"I would empower head teachers much more than they are and have independent governing bodies, not parent councils, whose vision is to make their school the best school in the world, something with really high aspirations."

An interesting idea, but does he think that a country whose politicians and trade unions compete to disparage private-sector intervention in public services, will suddenly embrace such experiments under independence?

Devolved Scotland already controls education after all, and has so far passed up every opportunity to follow the innovations of Blair and Gove. Does he think independence will somehow administer a national mentality-transplant?

Essentially, yes. Tulloch's fundamental belief is that doing it for ourselves, with no-one else to blame would be the catalyst to inspire bold and creative policies, even ones that might seem wildly incorrect to current political opinion.

"I don't have any proof of this, other than an observation of the Scottish character over many years. I think we would thrive. We are a very proud people for a start and we are a very collegiate people as well, at the heart of it.

"The pride is definitely there, the pride to succeed. The entrepreneurs are also there, and somehow we have got to get them to stay here or come back if they've gone overseas. To me what counts is the country's mindset, and you can change people's attitude."

The chance to find out whether he's right may soon be upon us.

TULLOCH ON >>>

Currency fears:

"It is in everyone's interests to maintain the currency union. What the UK Government is now saying in the heat of the campaign will change dramatically when calm heads prevail post the referendum vote. The recent weakness in sterling reflects concerns about what happens to the UK balance of payments without the disproportionately strong export contribution from Scotland, and also tothe UK's national debt if a shared currency were not agreed."

Threatened bank moves:

"These are very largely cosmetic changes

with a minimal impact on jobs. As they have been clearly orchestrated by the UK Government in conjunction with the No campaign, these announcements will simply annoy voters. It does matter though that we have some banks which are genuinely headquartered in Scotland as used to be the case with both the Bank of Scotland and the Royal Bank. Progress towards creating banks, more attuned to local business conditions and getting rid of their often socially unproductive speculative activities, has been disappointingly slow.

It would be in everyone's interest if the Government used their influence with Lloyds and RBS to persuade them to spin off their Scottish operations as separate companies."

Warnings over prices

"I was disappointed by the John Lewis intervention as I have always had a lot of respect for the group and particularly its partnership structure. It is hard not to see the hand of the UK Government behind the scenes because it was a

very uncharacteristic intervention."