Local Authorities: Fossil Fuel Holdings

Baroness Kramer Excerpts

Wednesday 24th February 2016 Lords Chamber

[Baroness Williams of Trafford]

My Lords, at the risk of repeating myself—I have said this several times over the last couple of days—if a local authority invests in a company whose share price is dropping significantly, it might be wise, in order to maximise the return for its investors, to invest in another company whose share price is increasing. That is a decision for it to make about its pension funds.

[Baroness Kramer (LD)]

My Lords, is the Minister aware that many pension funds regard it as their responsibility to have the best long-term returns, and therefore see sustainability of investments as absolutely key? She seems to be recommending that they go with short-term behaviour in the marketplace—behaviour that the Chancellor is frantically trying to change and which responsible pension funds have long since rejected, which is why many have ethical standards in their investment decisions.

[Baroness Williams of Trafford]

My Lords, local authorities should make decisions based on long-term and short-term investments in their portfolio and should keep an eye on both to ensure the best performance of those pension funds.