John McNally
Main Page: John McNally (Scottish National Party - Falkirk)Department Debates - View all John McNally's debates with the HM Treasury
Local Government: Ethical Procurement
John McNally Excerpts(8 years, 9 months ago)
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John Mc Nally (Falkirk) (SNP)
It is a pleasure to serve under your chairmanship, Mr Streeter. I particularly thank the hon. Member for Birmingham, Northfield (Richard Burden) for securing the debate. Like other hon. Members, I am quite curious as to why the Westminster Government want to censure local government authorities for making ethical decisions on where to invest their own pension funds.
Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)
Does my hon. Friend agree that it is not possible to make any economic decisions that are devoid of ethical impact?
John Mc Nally
I thank my hon. Friend for that intervention. I agree with him: that is the reason why we are here today—to discuss the ethical decisions that have been made by local authorities. I shall proceed as fast as I can, Mr Streeter.
The whole thing strikes me as not good practice; indeed, it could be called bad practice. I would like the Minister to explain to me the reasons for that interference by the Government with the principles, with the decisions made by trustees on behalf of local communities, who appoint tried and trusted fund managers to look after the pension funds for them. The Government are quite breathtaking in their contradictions. The Chancellor of the Exchequer has stated that he wants to start northern powerhouses; he wants to give local people more say in what is happening in their local communities. Yet he is telling them, “Sorry, you’re not going to get a say in what your pension funds do.” That is an absolute shambles of a policy, and it sounds to me as if he just made it up as he went along—for what reason, I would love to know. It would not be right to deny pension funds the right to direct their fund managers on how they want their investments to work for them. It is that local authority’s business. Local authorities alone are answerable to their communities in terms of how they want their funds to work for them.
Can the Minister explain to me and others why this policy differs from the one that I have just mentioned? The Government want to introduce powerhouses in the north of England to give people more powers, but now they are introducing this policy. I want to hear an answer on that. It sounds like an absolute and total contradiction. There is one rule for the Government and another rule for local authorities. That is absolutely and blatantly wrong.
We can compare the Westminster Government with the Scottish Government, who take a much more considered approach, with proper regard, respect and trust for the social and environmental investments made by pension fund managers on behalf of local authorities in Scotland. My local authority in Falkirk has £1.8 billion in its fund and at this moment might well be looking at investing with the Green Investment Bank. If that bank moves away from its original purpose—God forbid—of investing in green energy, surely an authority has the right to withdraw funding from that organisation; it will need to alter its investments accordingly. And the same is true for that pension fund with regard to international developments. That statement of investment principles must be honoured.