Environment campaigners call on Redbridge Council to stop investing in fossil fuels
PUBLISHED: 14:13 10 May 2018 | UPDATED: 16:09 10 May 2018
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A campaign group has urged Redbridge Council to stop investing in fossil fuels because of the damage they do to the environment.
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.
“It’s absolutely, fundamentally urgent. Commitments should be made immediately.”
He called on the council to “immediately freeze” new investments in fossil fuels and get rid of existing investments.
For campaigners, divestment – the opposite of investment – means withdrawing cash, stocks and shares in firms, removing fossil fuels as energy sources which, they say, contribute to extreme weather.
Campaigners from the Fossil Free movement published figures showing Redbridge Council’s pension pot has £38,260,700 tied up indirectly in fossil fuel businesses out of a £743,257,000 total – almost a 20th.
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 by 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. It is 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” snow storm 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 Redbridge to join Southwark and Waltham Forest councils which have promised to divest.
But 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.
Redbridge Council’s latest pension fund report states the fund’s panel doesn’t place ethical investment restrictions on managers though its hands-off approach is reviewed “regularly”.
The council’s pensions chiefs instruct fund managers, who have a right to vote on the plans of a firm invested in, to act in line with a national code on how to engage with companies, according to the 2016-17 report.
A principle of the code demands investors monitor what the companies they invest in do.
Fund managers provide the council’s investment panel with reports every three months on engagement undertaken with companies.
A council spokeswoman said: “Our pension fund does not invest directly in fossil fuel.
“We work with fund managers that have a strong focus on environmental, social and governance matters and a recent review of our investments shows the indirect value of our pension fund holdings in fossil fuel now stands at 3.99 per cent.”