KCC defends decision to invest in tobacco firms
Kent County Council has defended investing millions of
pounds in tobacco firms in pension funds at the same time as it
promotes anti-smoking programmes.
The authority has about £13.5m in the Altria Group; £3.6m
in Philip Morris; £3.5m in Imperial Tobacco and £3.4m in Japan
Finance chiefs say have a duty to get the best return for
pension holders and the £24m represents just 1% of all its
Around 20,000 pensioners and 26,000 active members belong
to the Kent Superannuation Fund.
Earlier this year, KCC - which is key partner in the Kent
Alliance on Smoking and Health - welcomed a government programme to
cut smoking, saying the habit was "one of the biggest and most
stubborn challenges to the health of our residents."
Smoking costs the county nearly £800m a year, with smokers
spending an estimated £430m on cigarettes and the associated costs
- such as health care - amounting to £370m.
A council spokesman said in a statement: "KCC runs a
pension fund on behalf of 350 public bodies in the county. The fund
uses external investment managers to undertake investments and the
fund has total investments in stocks and shares of
"It is the external investment managers who decide which
companies to invest in. The direct investments in tobacco companies
currently represent 1% of our total equity investments.
"We have a financial responsibility to obtain the best
possible return on investments of the pension fund, to keep down
costs of the scheme as far as possible for us as an employer and
ultimately for Kent taxpayers.
this responsibility, we do not impose restrictions on the companies
that our external investment managers can or cannot invest in.
However, we do monitor the activity undertaken by investment
managers and, as with all our investment, we work to the UN
principles of Responsible Investment."
Martin Dockrell of the campaign group Action on Smoking
and Health (ASH) said public sector bodies were unable to base
decisions on ethical grounds but KCC should question whether
tobacco firms represented a good investment.
"Pension trustees are legally obliged to get the best
return for pension holders. [But] with falling sales and civil
suits being made against them around the world, you have to ask
whether it is time to sell tobacco shares while they are at their
What do you think? Should the council invest in
tobacco firms? Or does it have a duty to obtain the 'best possible
return'? Join the debate below.
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