Pension fund arms row

MILLIONS of pounds of council workers' Tameside-based pension funds money are still being invested in arms and tobacco. Thousands of local authority staff are part of the region's biggest pension fund ' the Greater Manchester Pension Fund (GMPF).


Yakub Qureshi
29/ 2/2008

Last year, our sister paper the MEN reported how £100m of cash was being invested in 15 arms companies and £60m held in cigarette-manufacturing firms.
The revelation caused trade unions and campaigners to demanded a review of the fund's ethical policy. However, fund bosses refused to change their stance, although they promised to examine holdings in certain companies on a case-by-case basis if enough complaints were received.
Some £44m is invested in tobacco firms ' the largest being a £32m stake in British American Tobacco, whose brands include Benson&Hedges and Lucky Strike.
And although shares in a number of arms firms have been sold over the last year, a %total of £8m is still being invested in seven of the world's biggest defence companies.
These include Alliant Techsystems, which manufactures a number of controversial armaments including cluster bombs and shells containing depleted uranium casing, which has been linked to long-term illness among veterans and civilians.
It also includes a stake in Raytheon, the producer of the Tomahawk and Patriot missiles, and Northrop Grumman, the company behind a number of military aircraft.
The fund has assets in more than 1,000 companies. As well as shares and equities, the fund also has a sizeable property portfolio.
The fund, which is managed by Tameside council, has more than 200,000 members and is the largest one of its kind in Britain.
It was set up for to serve the needs of staff in the 10 Greater Manchester councils, but a number of staff in other public organisations such as the Greater Manchester Police Authority and Manchester Metropolitan Uuniversity are also members.
Councillor Roy Oldham, who chairs the fund, said the investments were small compared to the £9.5bn value of the fund. He said: "The fund has responsibilities to its scheme members to deliver their pensions and to employers to deliver those pensions at an affordable cost.
"Although the fund is prepared to listen to groups who oppose some of its investments, it cannot let this detract from its legal duty towards its members and those who rely on it."
"Clearly, there are special interest groups that oppose some of the fund's investments, but for example the manufacturing and retail industries run the risk, either directly or indirectly of contributing towards activities that are opposed by such groups.
"To place restrictions on investments in such companies could quickly lead to many companies being excluded with a consequential impact on investment returns."
Fund bosses who reviewed their ethical policy in September last year ruled their first priority was a return for members.
They said: ir report stated: "We prefer to concentrate on developing a policy that involves using voting and other contacts to positively influence company behaviour. "In our view, simply disinvesting from particular companies is a denial of responsibility.
"Rather, responsible institutional investors should seek to influence companies' policies by use of shareholder power

Von:, 29.02.2008

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