MLAs' Pensions Invested With Tobacco Giant

Source from:  Belfast Telegraph (uk) 01/09/2009

The pension scheme for Assembly members has invested in one of the world's largest cigarette companies, the Belfast Telegraph has learned. And the financial connection between Stormont and the international tobacco trade was today being questioned by a leading health campaigner in Northern Ireland. The link was disclosed in the accounts of the MLA pension scheme for the financial year 2007/08. It provided details of how outside financial advisers have invested money on behalf of the Assembly pension fund. The holdings included such big name companies as Vodafone, GlaxoSmithKline, the Royal Bank of Scotland and British American Tobacco, the accounts showed. British American Tobacco describes itself as the world's most international tobacco group, with a presence in more than 180 global markets. It recorded a ￡2,287 million profit in 2007 and reported continuing strong figures in 2008. The company has more than 300 brands, and boasts that its cigarettes are chosen by one in eight of the world's one billion adult smokers. The Assembly scheme's British American Tobacco investment comprised 1.4% of a portfolio administered for MLAs by Scottish company Baillie Gifford. Concern about the pension link has been voiced by Andrew Dougal, chief executive of the Northern Ireland Chest, Heart and Stroke charity. He said: "The Assembly would be best advised to divest itself of any investments in the tobacco industry. "It is responsible for looking after the health of the population and a connection to the tobacco industry is a conflict of interests." The pension scheme for MLAs is overseen by a cross-party group of trustees. A trustees' source said: "We seek to take an ethical stance on investments and have given instructions to our advisers. "They have explained that it is difficult to entirely avoid potentially controversial companies." The annual report for the pension scheme states: "All investments are in holdings that are permitted by the regulations of the Fund. "Although the Trustees cannot direct the investment strategy of the fund in which the Assembly Members' Pension Scheme (NI) 2000 invests, nevertheless, it will consider socially responsible investment policy issues when comparing two providers who are otherwise of equal preference." The trustees group was the only Assembly body to keep meeting during the suspension of devolution between 2002 and 2007. The pension scheme accounts for 2007/08 stated that the public purse made a ￡1,116,759 contribution to the fund in the year. Contributions from MLAs added a further ￡296,488. The fund's value was ￡10,214,247 at the end of the financial year. Baillie Gifford's term as investment manager for the MLA scheme expired during 2007/08. It was replaced by London-based M&G Investments Ltd. M&G's report within the pension scheme accounts cited investments in a number of companies including Unilever, BP, Royal Dutch Shell and GlaxoSmithKline. Its list also included nuclear power giant British Energy, which is described as being "in a strong position in an environment which is increasingly shifting towards nuclear energy". Enditem