Call for change as Falkirk Council pension fund loses £34 million

The reliance on fossil fuels has come under scrutiny in recent years.

Divest Falkirk claims Falkirk Council’s pension fund has lost £34 million over three years because it has chosen to invest in big oil and gas companies.

Falkirk saw the third largest loss behind Glasgow and Lothian, with Scottish councils in total losing £194,112,963, according to non-profit organisation, Platform, which commissioned the analysis by Transition Economics.

Divest Falkirk say councils such as Falkirk – which has a wide range of assets to help pay for the £80m of benefits due to pensioners each year – should be investing in renewable energy and social housing rather than oil, coal and gas.

Angus Maclean from Divest Falkirk said: “We have on many occasions raised these financial risks with councillors and unfortunately they have been met with deaf ears.

“It is time the Falkirk Pension Fund listens and works towards a more sustainable future for all of us.”

A spokesperson for the Falkirk Penson Fund said: “The value of the Fund’s assets change on a daily basis and it is no surprise that valuations have fallen in the face of financial market concerns around the Covid‐19 pandemic.

“No pensioner benefits are affected by changes in asset valuation as benefits are guaranteed and do not depend on investment performance.

“We are very much strong advocates of companies taking action to be more carbon efficient but cannot forget that our primary responsibilities are to manage the pension fund for the benefit of all our stakeholders.

“We think the best way to do this is to run a well‐diversified portfolio whilst having robust conversations with the companies we invest in.”

As a fund, they are members of several lobby groups while the Pensions Committee has promised to look at divesting from companies that don’t make progress towards targets set in the Paris Agreement.

The fund has also co‐filed climate change resolutions at BP and Barclays AGMs – the latter leading to Barclays unveiling its 2050 net zero ambition.

“We are also signatories to a recent letter to the PM calling for ambitious national contributions to be pledged for meeting net zero targets.”

Members of Divest Falkirk say they have been talking to councillors and representatives of the Falkirk council Pension Fund since 2018 and want to see more change.

In particular, they criticised the SNP’s environment spokesman, Paul Garner, for what they said was a “lack of interest and concern”, when they met last year.

In response, Councillor Garner said that since meeting the group, the council had passed a Climate Emergency motion and set up a cross-party working group to tackle the issue.

He said: “Just recently there was great news that investment in renewable energy stocks has overtaken that of companies based on fossil fuel removal.

“The SNP-led administration is currently looking to see if pension divestment from fossil fuels and into sustainable energy is achievable.

“This has to be done with agreements from other councils that we are in discussion with as our pension funds are tied in with them.”