Welsh councils invest over £1 billion in climate wrecking fossil fuels – report

Welsh councils invest over £1 billion in climate wrecking fossil fuels – report

• Includes data for individual local authority pension funds

Welsh councils [1,2] are investing over £1 billion of their workers’ pensions in climate-wrecking fossil fuels, new data released today [9 November] reveals.

The revelation that Welsh local government pension funds are heavily invested in the industry most responsible for climate change [3], comes as the COP23 United Nations climate talks start in Bonn

The new report, Fuelling the Fire, produced by Friends of the Earth, 350.org, Platform and Energy Democracy Project reveals that:
• Welsh councils invest £1,027,843,384 of their pension funds in fossil fuel companies out of a total of £15,382,932,477
• Torfaen and Dyfed local authority pension funds are among the funds with the highest percentage investment in fossil fuels (see note 1 for a full list of Welsh local authority pension funds)

The pension fund investments appear to fly in the face of the Well-being of Future Generations (Wales) Act of 2015, which requires public bodies in Wales to consider environmental and sustainable development in every decision they make. This Act strives to protect future generations from the devastating impacts of climate change and local authorities are accountable to it [4].

Bleddyn Lake, climate campaigner at Friends of the Earth Cymru, said:

“It’s appalling that Welsh local authority pension funds are investing in climate-wrecking fossil fuels. This appears to fly in the face of their legal responsibility to consider the well-being of people and their environment in their decision-making.

“These pension funds are supposed to provide security for workers when they retire. But with the world waking up to the necessity of ending its reliance on gas, coal and oil, the fossil fuel industry is no longer a sustainable, sensible investment choice.

“Local authorities must show some real leadership on climate change, as well as protecting pensions, by ending their investments in the fossil fuel industry.”

George Guivalu Nacewa, Fiji Climate Warrior attending the COP23 talks in Bonn, said:

“In the Pacific, the impacts of climate change are not a debate, it is our reality. We need to keep fossil fuels in the ground. We no longer have time to talk Now is the time to act.”

The new data also reveals that across the UK councils invest a total of £16.1bn of workers’ pensions in fossil fuels out of a total of £287.9bn. Compared to 2015 data, investments in fossil fuels have gone up in real terms (from £14bn) and did not change significantly in proportion to the size of the pension funds [5]. These figures show that councils have not made any significant changes to their investments in response to calls from the climate movement, governments, and shareholders to take climate risk into account, in the two years since the Paris Agreement on climate change.

Air pollution from fossil fuel burning is responsible for millions of early deaths each year. Meanwhile, climate change, which is fuelled by fossil fuels, is already damaging the health of hundreds of millions of people [6].

The data and online map released by 350.org, Platform, Energy Democracy Project, and Friends of the Earth ranks councils by their fossil fuel investments, and allows residents to see every company or fund that their local council invests in [2].

Several UK councils have already committed to divest their pensions from fossil fuels [7]. Waltham Forest (London) Councillor Simon Miller (Cabinet Member, Economic Growth & High Streets, previously Chair of Waltham Forest Pension Fund) said:

“I am proud that Waltham Forest has committed to divest from fossil fuels. Given current pressures on Local Authority budgets, our pension funds have a key role to play, not only in making our economy greener and our communities healthier, but as driver of sustainable, future focused investment in local areas.”

The campaign to divest local council pensions has this year received backing from UNISON [8] and the Trade Union Congress [9].