£50m From Public Sector Pensions is Invested in Tobacco

Source from:  Balfast Telegraph 10/14/2010

The Belfast Telegraph today reveals how local government workers across Northern Ireland are helping to bankroll the global tobacco industry through their pensions. An investigation by this newspaper has uncovered how the body responsible for managing thousands of workers' pensions has millions tied up in the deadly industry. The Northern Ireland Local Government Officers' Superannuation Committee (NILGOSC), which administers pensions for 44,000 employees, has £48.7m invested in tobacco firms. Among the 204 employers represented by the umbrella body are the Northern Ireland Hospice, the Sports Council, Arts Council, the General Teaching Council plus many schools. It will be highly embarrassing to the bodies, many of whom are strongly opposed to smoking and tobacco use. An estimated 2,500 people die every year in Northern Ireland from smoking-related illnesses. However, NILGOSC said its priority is to get the best return on pensions. Details of NILGOSC's investments were revealed after a Freedom of Information request from this newspaper. Documents reveal it has invested £48,785,804 in five firms, with £34,322,622 pumped into British American Tobacco, producers of Dunhill cigarettes. Almost £10m more is invested in Imperial Tobacco Group, whose brands include Lambert and Butler, with a further £1.7m going to Philip Morris International. Finance expert Justin Urquhart-Stewart said the tobacco industry remained a profitable investment. "At times like this, when the economy is quite weak, this is a sound industry which pays a good dividend," he said. "Tobacco companies are recession-proof, fast cash producers, and they are a God-send for those with a pension deficit to fill." But others have said it is wrong to profit from an industry responsible for thousands of deaths every year in Northern Ireland. Professor Mahendra Varma, chairman of Northern Ireland Chest Heart & Stroke, said it was an investment in death. "It's time to put a stop to the idea that planning for a comfortable retirement entitles us to invest in the suffering and painful death of others," he said. Jim Wells, who chairs the Stormont Health Committee, said it was "hypocritical" that employees of councils who enforced no-smoking policies and promoted healthy living should have their pensions invested in tobacco. Mr Wells, who is also a member of Down District Council, said he was unaware that his council's pensions may have been invested in tobacco firms. "It is hypocritical to set anti-smoking policies and then invest such huge amounts of money in the tobacco industry," he said. "Last year more than 2,000 people in Northern Ireland died as a direct result of smoking-related diseases. "No doubt some of those who died are former local government employees who would have availed of this pension scheme." Both the Northern Ireland Hospice and Sport NI said they were unaware that employees' pensions were invested in tobacco firms. A spokesperson for NILGOSC said the body is a signatory to the UN Principles of Responsible Investment. "All pension scheme trustees have a fiduciary duty to act in the best interests of its members and to maintain an adequate fund to meet the retirement liabilities," he said. "Where investments of a certain type would be more beneficial to beneficiaries than other investments, trustees must not refrain from making the investment by reason of the views they hold. "NILGOSC currently delegates the selection of investments to its fund managers and does not impose any investment restrictions with respect to social, ethical and environmental issues." Enditem