Court decision freeing pension funds to invest ethically is welcome, say UNISON
A UK Supreme Court decision overturned guidance which banned Local Government Pension (LGPS) funds from having policies which “supported boycotts, divestment and sanctions against foreign nations and UK defence industries”. This decision cannot be appealed.
Campaigners have argued that this guidance was a deliberate attempt to block campaigns which urged support for investment in Palestine and, for example, to stop investment in the arms trade.
Although the guidance only applied to England and Wales, the Supreme Court decision reinforces the freedom of the 11 LGPS pension funds in Scotland to make their own investment decisions, in line with the wishes of their members and employers.
Simon Watson, UNISON Scotland regional organiser, said: “This court ruling reinforces the principle that decisions about pensions funds should be made by representatives of the workers and employers who pay in. It is their deferred wages and they have a right to influence how their money is invested.”
“The main role of LGPS Pension Schemes in Scotland is to safeguard the pensions of workers, but there is no reason why they cannot do this and have an ethical approach, and this decision reinforces that. Every pension fund will be acutely aware of the long-term risks of investing in carbon-based industries.”
Notes:
On 29 April 2020, the Supreme Court handed down its judgment in the Palestine Solidarity Campaign case. It decided that two passages in the Secretary of State’s 2016 guidance (“using pension policies to pursue boycotts, divestment and sanctions against foreign nations and UK defence industries is inappropriate, other than where formal legal sanctions, embargoes and restrictions have been put in place by the Government” and authorities “[s]hould not pursue policies that are contrary to UK foreign policy or UK defence policy“) are unlawful, on the basis that the Secretary of State exceeded his powers in issuing them.
https://www.supremecourt.uk/cases/uksc-2018-0133.html
UNISON Contacts
Simon Watson, regional organiser: 07903 055477 s.watson@unison.co.uk
Danny Philips: 07944 664110 d.phillips@unison.co.uk