A growing cross-party coalition of UK parliamentarians is calling for a meeting with the trustees of the £487m (€615m) Parliamentary Contributory Pension Fund (PCPF), the pension fund for UK MPs, to discuss the integration of climate and carbon risk into its investments as well as more transparency about its exposure to fossil fuel companies.
A letter has been sent to chairman of trustees Brian Donohoe, a former trade unionist who is an MP with the opposition Labour Party, by Green Party MP Caroline Lucas.
The letter, which has since been co-signed by 12 other parliamentary figures, raises concerns about the fund’s investments in fossil fuel industries and the risks from effective climate regulation.
The letter asks for transparency about how much of the fund’s assets are invested in fossil fuel companies; how much of the fund’s assets are invested in the low-carbon economy; and whether the fund has looked at asking its investment managers to examine reallocating capital away from fossil fuel companies over time.
Donohoe has responded in the press, saying that he does not think fossil fuels are an investment that the fund should avoid. “We’ve got to balance what individuals like she [Lucas] will say about certain investments… [with] the good of the fund. Now that doesn’t mean to say we go down an amoral road, with tobacco or whatever else, clearly we don’t.”
Lucas has hit back. Speaking yesterday (October 21) at a UKSIF Parliamentary event to celebrate UK Good Money Week, she said it was not about “lone voices”, but about “sound environmental and economic sense”.She said she would continue to mobilise other MPs to get in touch with the MPs’ fund. “Information around its investments are opaque,” she said. “We are asking basic questions such as where money is invested and what are the risks.”
Lucas – arrested last year in a protest over fracking – said the PCPF formally adopted the Stewardship Code last year, and added that, in light of Bank of England Governor Mark Carney’s remarks about unburnable fossil fuel reserves, the pension fund should start divesting from fossil fuels.
Lucas also said she was in talks with Carney on “green quantitative easing”. In March, Carney hinted that the Bank could invest in low carbon infrastructure under such a banner. She has called on the government to allow the £3bn Green Investment Bank to be able to borrow and issue bonds that could then be bought by the Bank of England.
Signatories to Lucas’ letter include Liberal Democrat MP Julian Huppert, who is also chair of the All-Party Parliamentary Group on Responsible Investment, whose secretariat is provided by campaign group ShareAction. Huppert, who has campaigned for the scrapping of Britain’s nuclear weapons, also spoke at the UKSIF event. He said he would table a so-called ‘early day motion’ in Parliament on the PCPF and fossil fuels. Though he did concede that such a move was usually just “graffiti” in Parliament.
Other signatories to the letter include Labour peer Lord Joffe, former chair of Oxfam, who, as a human rights lawyer helped to represent Nelson Mandela.