Archive
Revealed: £220m of public sector pensions tied to tobacco and arms manufacturers | Herald Scotland
£30m of Tayside pensions tied up in tobacco firms – Dundee / Local / News / The Courier
£30m of Tayside pensions tied up in tobacco firms – Dundee / Local / News / The Courier.
Tayside to consider whether to divest at meeting in March. Will FCTC obligations form part of the considerations?
Controversy in Gloucestershire
Shire Hall pension investment in tobacco raises moral questions | This is Gloucestershire.
Local news story as tobacco investments challenged at full council meeting in Gloucestershire.
Cllr Theodoulou said the current way of working “was the right way to continue in the future”.
“If there were to be a ban on particular sectors I think it would have to apply to all authorities. We cannot pick and choose,” he said.
This line appears to ignore completely the Framework Convention on Tobacco Control, the worlds one and only public health Treaty to which the UK is a signatory. The Guidelines to the Treaty specify that local authorities should not invest in tobacco companies.
Pension funds stay in tobacco industry (From Worcester News)
Pension funds stay in tobacco industry (From Worcester News).
Fierce debate reported at Worcester Council but the council has voted to stay invested in tobacco companies. Its tobacco investments bring in about £2m income a year. Smoking kills about 860 people a year in the county. Around £2300 a life. Not much of a return on investment is it?
BBC News – Councils invest in tobacco while helping smokers quit
BBC News – Councils invest in tobacco while helping smokers quit.
Local news piece from West Midlands.
Public Health staff to invest in tobacco!
It had been previously announced that public health staff transferring to local authorities (LA) in April would be able to retain membership of the NHS Pension Scheme.
Unlike LAs the NHS scheme does not have an investment fund, and so does not have investments in tobacco stocks. By contrast LAs have £1.67 billion invested in these companies.
However the letter available at the link above makes it clear that this protection only applies to the initial post into which an individual transfers. If you subsequently accept a different post, a promotion for example, then you will no longer be able to belong to the NHS scheme in that post (with some exemptions for those nearing retirement). Newly appointed public health staff will also not be able to join the NHS scheme.
What this means is that public health professionals will be obliged either to join the local government scheme and thus invest a proportion of their retirement savings in tobacco companies (except in Newham) or simply not join the local government pension scheme by opting out. A very unsatisfactory situation indeed.
It would clearly be a nonsense, indeed unethical, for public health professionals to invest in tobacco companies. There again it will also be unethical for local authorities to invest in tobacco after March as well. But will they recognise the inherent contradiction and divest?
OfSmoke price cap proposal – writing on the wall for tobacco stocks?
The publication this week of a radical new proposal to impose price cap regulation on tobacco companies (TC) poses a major challenge to the industry if adopted by governments in the UK and other high tax countries. The proposal is to restrict profitability to a similar level to other consumer goods companies. The TCs currently make huge profits of up to 67% (two thirds) of revenue in the UK. They can do this because in a high tax market with strong marketing restrictions, they have a monopoly position (Imperial 44%, JTI 35%) and can increase prices which most smokers will blame on the government. It will come as a surprise to many smokers that the UK is one of the most profitable markets for tobacco companies.
With 95% of the UK market controlled by the Big 4 tobacco companies, they make over a billion pounds profit, at an estimated average rate of 51% of revenue. If profit were capped at 20% of revenue, then the reduction in profit would be over £660m, reducing profit to £424m.
It remains to be seen how the government responds to this proposal. There has been wide media coverage, and in a time of austerity the Treasury is likely to see the attraction of taking £500m extra taxation from the tobacco industry which cannot be passed onto the smoker by the companies.
For pension fund managers, this proposal has huge implications. If there are any signs that government intends to pursue this option, tobacco share prices will plummet. BAT and Imperial are already down over the last 6 months. Maybe the time has come for LA pension funds to pull out of tobacco, as this proposal now presents a significant risk to the future value of tobacco stocks.
http://tobaccocontrol.bmj.com/content/early/2013/01/04/tobaccocontrol-2011-050385.abstract?papetoc
Australian Super Fund Dumps Tobacco Investments
Hesta Dumps Tobacco Investments.
Another Aussie fund has taken the decision to pull out of tobacco. Great quote in this piece:
”If a health fund invests in the tobacco industry, they are part of the tobacco industry,”
So if an English Council invests in tobacco companies, it is part of the tobacco industry. The industry that kills more people prematurely than any other preventable cause; the industry that causes nearly all lung cancer; the industry which is the largest single driver of health inequalities.
The conflict of interest is untenable.
BBC News – Staffordshire councils review tobacco pension investments
BBC News – Staffordshire councils review tobacco pension investments.
The Politics Show West Midlands recently reported the scale of pension fund investments in tobacco companies in the region. Now Staffordshire Council has announced a review.
With over 1800 people a year being killed by smoking in Staffordshire, one wonders how the council can lead on public health from April if it continues to invest in tobacco.
Newcastle City Council’s leader has clearly stated his intention to pursue this issue in Tyne and Wear. Let us hope that others like Staffordshire follow suit.
BBC Radio 4 – You and Yours, Tobacco Funding
BBC Radio 4 – You and Yours, Tobacco Funding.
I made a brief appearance on the BBC radio 4 consumer programme You and Yours today, as a pre-recorded intro to a debate featuring Newcastle City Council leader Cllr Nick Forbes, who is taking a strong lead in advocating for local authority pension funds to withdraw from tobacco investments.
Nick made a strong case that it makes no sense for local authorities to invest in smoking cessation services and tobacco control, while at the same time investing in tobacco companies that seek to maximise sales of tobacco.
Well worth a listen. The item can be heard on BBC iPlayer via the link and is the last item on the programme.
Tobacco Free Pensions 