Australia: State Lambasted for Tobacco Investment

Source from:  The Australian 01/28/2013

STATE government agencies are investing almost $40 million in tobacco companies despite the Labor administration's expenditure on public health campaigns to try to reduce smoking.

The Australian Medical Association accused the government yesterday of hypocrisy, while the Heart Foundation said Labor had a clear conflict as it undermined federal tobacco-control measures such as plain packaging laws.

The state government's superannuation funds-management corporation Funds SA places 0.15 per cent of its investment assets in the tobacco industry.

This brings its investment in the manufacture of tobacco products to $28.8m.

WorkCoverSA, which manages the workers' rehabilitation and compensation scheme for the government, said its "indirect exposure" to the tobacco industry was less than 0.5 per cent of its total investment portfolio.

This amounts to an investment in tobacco products of about $9.1m as of June 30 last year. This is up from $3.9m on the previous financial year.

AMA state president Peter Sharley said the investment was hypocritical when governments were trying to reduce tobacco use in the community.

"Smoking is the biggest death-causing problem we have, so while the government is investing in smoking it is investing in the death of thousands of people every year," Dr Sharley said.

Yesterday, two hours after The Weekend Australian sought comment from Funds SA, the state's new Health Minister Jack Snelling issued a general media alert to announce that manufacturers of tobacco products would be "excluded" from Funds SA investment portfolios. Funds SA chief executive Richard Smith declined to comment.

The announcement by Mr Snelling, replaced as treasurer this week by Premier Jay Weatherill, came yesterday despite the decision to reduce the exposure to tobacco products having been made by the Funds SA board on December 17.

The minister's media release provided no timeframe for the move and noted in the final paragraph that "exposure to tobacco manufacturers cannot be completely eliminated".

Heart Foundation chief executive Lyn Roberts said governments had taken a long time to deal with their conflict over investment in tobacco companies. "It has taken time for governments to face up and look at their responsibilities," Dr Roberts said.

"There is a question about whether there are any other investments in tobacco that are going on from a government perspective and that's an area we'd welcome transparency." Enditem