UK union takes aim at local pension funds in £16bn divestment campaign

The UK’s Local Government Pension Schemes (LGPS) are the target of a new fossil fuel divestment campaign from public service union Unison, which is calling for £16bn of carbon-related investments to be divested within five years.
The campaign has been launched alongside a guide, co-written by ShareAction, to help members of LGPS funds engage on the divestment issue. It includes details on how pensions and investments work, the financial risk of climate change, and examples of how to start a campaign.
It follows a motion passed by Unison last June, which saw it commit to engagement with the funds over the next five years, to encourage them to sell carbon-related assets, owing to the impact of climate change on people, societies and ecosystems.
The motion requires any divestment demands from Unison members to include alternative investment proposals, consider costs and also reflect a ‘just transition’ – decent jobs and pensions for Unison members currently working in the carbon sector.
The UK’s 97 local authority pension funds collectively invest £16.1bn in fossil fuels – up from £13.8bn in 2015 – according to recent analysis from divestment campaigners.There are already nearly 50 divestment campaigns targeting the LGPS funds, according to Dave Prentis, Unison’s General Secretary. Pension funds for the London boroughs of Southwark, Waltham Forest and Hackney have already committed to some form of fossil fuel divestment.
Chair of UNISON’s policy committee, James Anthony, said “Pensions are meant to safeguard our future, but that future is threatened by the burning of carbon in fossil fuels like coal, oil and gas.
“This campaign empowers people to hold their pension funds to account. If you contribute to a pension then it’s your money that’s being invested, and so it’s only right that you should have a say in where it’s invested.”
The campaign comes as England and Wales’ 88 LGPS funds undertake a ‘pooling’ process – merging into just eight bodies. It is possible that fossil fuel divestment campaigns could ignite tension in pools, say observers, if funds have differing approaches to responsible investment.
The £28bn Brunel Pension Partnership, one of the new UK’s pension pools, could consider “selective disinvestment” of carbon intensive companies, according to the Environment Agency Pension Fund – one of its members.