Call for council pension funds to stop investing in fossil fuel companies

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Scottish council pension funds have invested £1.8 billion in fossil fuels, according to new analysis by Friends of the Earth.

The charity said the investments in various coal, oil and gas companies “fly in the face” of wider efforts to reduce dependence on the energy source.

Its report on UK local government pension schemes and their investments indicates that, between 2015 and 2017, Scottish council investments in fossil fuel firms increased by £146 million.

The analysis found that Dumfries and Galloway Pension Fund now invests 9.4% of its fund in the sector – the second highest proportion in the UK.

Meanwhile it found that Strathclyde Pension Fund, Scotland’s largest, has invested £803 million – 4.1% of its total fund – in fossil fuel companies.

The figures were calculated after campaigning organisation Platform obtained details of funds’ investments for 2016/17.

Analysis was also carried out into “pooled investment vehicles” used by the funds, with estimates of the proportion of fossil fuel investments contained in each vehicle.

The report comes after the Scottish Government pledged to phase out new petrol and diesel cars and vans across Scotland by 2032, eight years ahead of the UK Government target.

Scottish ministers also recently announced a ban on fracking, the controversial technique used to recover gas and oil from shale rock.

Ric Lander of Friends of the Earth Scotland said: “Scotland’s councils are ignoring the realities of climate change.

“Their investments in deeply destructive fossil fuel companies fly in the face of Scotland’s wider efforts to phase out fossil fuel cars and ban fracking.”

The charity has called on council funds to divest from fossil fuels.

Mr Lander added: “Fossil fuel companies won’t be talked into dropping their core business of digging oil, gas and coal out of the ground.

“Councillors who oversee these funds need to take action to make their pension funds compatible with a future worth living in by divesting.

“Pension funds cannot provide for a safe future whilst investing in the companies driving climate change.”

A spokesman for council body Cosla said: “The Scottish Local Government Pension Funds make investment decisions in line with their fiduciary duty and legal obligations.

“Accountability lies entirely with the Pension Funds and their respective Pension Committees with regard to the decisions made.”

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