North Yorkshire Pension Fund chairman rejects claims over fossil fuels

The boss of a local authority-run pension fund to which almost 97,000 people have contributed, has rejected claims that with up to £73m invested in fossil fuel firms, the pension fund is directly contradicting the council’s carbon cutting efforts.

By Stuart Minting, Local Democracy Reporting Service
Tuesday, 3rd May 2022, 1:39 pm

Cllr John Weighell, chairman of the North Yorkshire Pension Fund board, has responded to calls by Fossil Free North Yorkshire to persuade the board to move away from investing in fossil fuel companies and reinvest in “more regional, ethical and environmental projects”.

The calls come just weeks after the board, which is comprised of councillors from North Yorkshire and York, faced other questions over the ethics of its investments on behalf of its past and present contributors, as it emerged the fund had about £5m invested in Russian companies.

The questions over the investments also come as the £5bn pension fund is in a particularly strong position.

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John Weighell, chairman of North Yorkshire Pension Fund.

The last decade has seen a turnaround in the fortunes of the North Yorkshire Pension Fund which has been described by council officers as “miraculous”, going from a funding level of just 35 per cent to 129 per cent, with a £1bn surplus.

Fossil Free North Yorkshire said a UK Divest report had revealed between £33m and £73m – dependent on changeable financial markets – of the North Yorkshire fund is invested in the fossil fuel industry.

The campaign group says investing pensions in fossil fuels is fuelling climate change and air pollution, and contradicting local, national and international commitments to tackle climate change.

A Fossil Free North Yorkshire spokeswoman said the board also putting pension fund members’ pensions at risk as fossil fuel investments now posed “a dangerous long-term financial risk to investors”.

She added: “North Yorkshire County Council has ambitious plans to become carbon neutral by 2030.

“We welcome North Yorkshire pension fund committing five per cent of the fund to an infrastructure fund that not only represents a very positive impetus to the regional economy, but also a fantastic opportunity to invest in the future- in terms of renewable energy and other industries that support sustainability.

“Yet its continued investment in fossil fuels contradicts this aspiration.”

The campaign group has written to all the political parties standing in the North Yorkshire Council election on May 5 to highlight its conviction that investing pension funds in fossil fuels accelerates the climate crisis.

Dr Margaret Jackson, of Fossil Free North Yorkshire, said: “The current energy crisis has revealed just how unstable and unreliable fossil fuels are and makes the argument for a rapid transition to renewables even more urgent.”

Cllr John Weighell, chairman of the North Yorkshire Pension Fund board, said many firms which have traditionally traded fossil fuels were now developing significant renewable energy arms, so deciding between firms to invest in was not always straightforward.

He said the fossil fuel investments which Fossil Free North Yorkshire have claimed total up to £73m needed to be considered in the context of the £5bn pension fund.

The former North Yorkshire County Council leader added the board’s first duty was to make the maximum amount of money for its current contributors as well as pensioners.

Cllr Weighell said: “We have been slowly but surely moving away from a reliance on fossil fuel investments for a long time.

"Our prime aim is to get into and out of equity investments at the best time and therefore you don’t just suddenly say we’re selling regardless of price.

“The council’s carbon cutting target is a policy for quite a number of years in advance and the pension fund backs up the policy completely by reducing over a period of time.”