�75m of public money in tobacco firms

OVER �75m of public money is invested in tobacco companies by Hertfordshire and Cambridgeshire County Council- managed pension pots.

Hertfordshire County Council’s Local Government Pension Scheme fund, which oversees pensions for various public employers such as North Herts District Council, has �50,471,640 in various firms as of October 28.

This includes �33,474,796 in British American Tobacco – which produces Dunhill, Kent and Lucky Strike cigarettes – and �11,472,688 in Imperial Tobacco, which owns the Embassy, Lambert & Butler and Drum brands.

The investment in tobacco has been criticised by anti-smoking group Action on Smoking and Health (ASH) which says it is time for local authorities to rethink as the number of smokers is falling and firms may not continue to offer a guaranteed return.

“It can be argued that there is an ethical and moral issue but purely on financial grounds we would question the assumption that tobacco is a good source of investment now as smoking is decreasing – not only in the west but in other parts of the world,” an ASH spokesman said.

“It’s on those grounds we would urge local authorities to rethink their investment in tobacco.”

HCC and NHDC’s websites both have links to stop-smoking organisations and the district employs a smoking cessation officer – funded by the Department for Health.

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NHDC also issued a press release earlier this year praising the region for the number of smokers who had managed to quit.

HCC defended the move claiming the investment helps secure the best long-term investment – reducing the strain on rate payers.

A spokesman said: “We expect our investment managers to make investment decisions taking into account all relevant factors, with the objective of securing the best long-term investment returns to meet our pension liabilities and reduce the cost to the local taxpayer. We therefore do not constrain the fund manager.”

Cllr David Lloyd, deputy leader of HCC and chairman of the pension committee said that it was important not to restrain the pension fund manager in any way.

He told The Crow: “If you start to look into areas such as tobacco you get into a position where you are not managing to get the best investment for pensions, it’s ethical that future council taxpayers don’t have to pick up the bill for the pension fund.”

The Cambridgeshire County Council overseen Cambridgeshire Local Government Pension Scheme Fund has �25m invested in tobacco companies which accounts for 1.9 per cent of the total fund.

“A very, very small percentage of holdings in the Cambridgeshire pension fund – 1.9 per cent – is invested in tobacco companies”, a spokesman said.

“We have a responsibility to taxpayers to make sure that money invested attains the maximum level of return within an acceptable degree of risk.”

“The trustees of the Pension Fund have a single objective, which is to maximise returns to meet the fund’s pension liabilities, and therefore reduce the cost to taxpayers.”

Despite the authority’s reassurances the Lib Dem county council health spokesman refutes the council’s stance

Cllr Caroline Shepherd, said: “Given the council’s new responsibility for public health and the strategic health risk posed by smoking, it is strange that the Conservatives see fit to hold �25m in cigarette companies.

“The Cambridge University Pensions fund has no investments in tobacco firms, which only goes to show that investment choices can be made.”