Council urged to stop investing in fossil fuels that 'wreck the planet'
PUBLISHED: 14:10 10 May 2018 | UPDATED: 14:10 10 May 2018
A campaign group is urging the council not to profit from wrecking the planet..
Finnian Murtagh of Fossil Free London – which wants local authorities to stop buying shares in coal, oil and gas companies – said: “If it’s wrong to wreck the planet through climate change, then it’s wrong to profit from that wreckage.”
He called on Havering Council to “immediately freeze” new investments in fossil fuels and get rid of existing investments.
“It’s absolutely, fundamentally urgent. Commitments should be made immediately,” he said.
For campaigners, divestment – the opposite of investment – means withdrawing cash, stocks and shares in firms removing fossil fuels as energy sources and contributing to extreme weather.
Campaigners from the Fossil Free movement published figures showing Havering Council’s pension pot has £676,942 directly invested in fossil fuel businesses and a projected £38,912,642 indirect investments out of a £657,188,535 total.
Climate activists argue there are financial and moral reasons for councils to divest.
They say governments taking stronger action against climate change could slap a high price on carbon dioxide, a gas released when fossil fuels are burnt which raises the earth’s temperature.
Under an international deal known as the Paris Agreement governments agreed to tackle climate change.
“The fossil fuel industry is in danger of going belly up assuming governments live up to those commitments,” Mr Murtagh said.
Campaigners point to comments made Bank of England boss Mark Carney, who warned fossil fuel companies cannot burn oil, gas and coal if the planet is to avoid a climate catastrophe.
Mr Murtagh added councils risk breaking a legal duty to get the most profit for their pension holders by investing in an industry campaigners say is at risk of collapse.
The second argument is councils that don’t divest prop up an industry posing a threat to the environment including flooding of the Thames, predicted to rise by more than a metre by the end of the century as a result of heavier rainfall and rising sea levels, according to Mr Murtagh. He pointed to the “beast from the east” as another climate change example. He said pollution from diesel cars also contributes to poor air quality in the city, including around schools and in poorer areas.
In March London Mayor Sadiq Khan called on councils to ditch fossil fuel investment.
“By working together, we will have a louder voice to convince polluting firms to change their ways to tackle climate change,” he said.
Campaigners demanded the council pledge to divest over the next four years.
“It’s the ethical thing to do,” Mr Murtagh said before urging Havering to join Southwark and Waltham Forest councils which have promised to divest.
Critics say plans for councils paying into the local government pension scheme to combine their pension pots into one may scupper divestment plans.
But not according to Mr Murtagh who said it was even more important councils divest so they can shape a London-wide fund to protect pension holders from fossil fuel investments and support a stable climate.
Members of Havering Council’s pensions committee discussed fossil fuel investments in a meeting in December.
Its pension chiefs recognised the impact companies have on the environment was something which could influence profits made on investments, according to a committee report.
Fund managers “use their influence to promote good practice” in the companies and markets the council is exposed to, they added.
A report went on to note the council is in discussion with pensions firm Hymans Robertson about the possibility of monitoring so-called “green” or ethical investments to engage with business.
However, Havering’s pension chiefs said concerns about the environment should not trump where funds are invested if it meant its pension fund lost money.
“Investment managers have full discretion over day to day decision making,” the review report stated.
But this isn’t far enough for Mr Murtagh who said: “It’s time Havering occupied a moral position by saying no to fossil fuels.”