Calderdale leaders expected to make ‘green’ recommendation on staff pension fund
Calderdale Council’s Cabinet is expected to request a regional staff pension fund disinvests from fossil fuels and that instead invests in alternatives such as green energy.
When it meets on Monday, July 5, Calderdale Council’s Cabinet is asked to formally endorse or adopt a position on pensions investment, with council leader Coun Tim Swift (Lab, Town) and Chief Executive Robin Tuddenham to then write to the chief operating officer fo the West Yorkshire Pension Fund making the request, if members agree that course of action.
But they are warned it may carry a financial risk.
The issue has previously been debated by the council’s Climate Change Cabinet Working Party, a meeting which was not without argument.
Some members of the cross-party working party were concerned that disinvesting from fossil fuel investments could adversely impact people’s pensions but a majority agreed to recommend Cabinet make the call, arguing alternatives are expected to offer returns in the long term and the move would be in line with Cities Race To Net Zero pledges which have been made.
Many councils as well as Calderdale have set carbon reduction targets and the UK as a whole has committed to net zero as a legally binding target by 2050 – reducing use of fossil fuels would play a necessary part in this, they argued.
West Yorkshire Pension Fund has a wide portfolio of investments, including investments in fossil fuel and tobacco companies, councillors have been told, and bearing in mind regional and local commitment to countering climate change and setting of carbon reduction targets, say the briefing papers to Cabinet.
The working party agreed to ask Cabinet to make the call to dis-invest from fossil fuel companies over a three year period or less in favour of greener finance to help tackle climate emergency issues.
But councillors are warned that if disinvestment in fossil fuels and replacing this with investment in alternatives resulted in reductions in investment income, it could result in increased pension contributions being required from the West Yorkshire councils in order to maintain defined benefits for pensioners.
The council has to be clear on the financial impact of disinvestment of the scheme, say the briefing papers, and staff, as members of the scheme, may need to be consulted on the possible impact.
Trade Union consultation will be required if there are implications to staff pensions.
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