Kent council may have to end investment in tobacco firms
- 17 May 2012
- From the section Kent
Kent County Council may have to withdraw millions of pounds invested in tobacco companies, according to an internal report.
The authority currently has £24m invested in tobacco firms as part of its pension fund portfolio.
A draft report warns in future it may have a legal duty to protect the health of residents and tobacco investments would be "incompatible" with this.
The council said the investment was a "difficult ethical balance".
It has invested about £13.5m in the Altria Group, £3.6m in Philip Morris £3.5m in Imperial Tobacco and £3.4m in Japan Tobacco.
The authority said the amount was 1% of all its investments and it had a duty to get the best return for its members.
John Simmonds, cabinet member for finance, said: "A few years ago everybody was worried about the deficits on pension funds.
"Because of the performance we've been able to achieve through some very good management in the pension fund, that is now no longer an issue.
"We've got to make sure that the fund is preserved and people can generate their pensions for a lifetime, so it's a very difficult ethical balance."
However, Trudy Dean, who is the leader of the Liberal Democrat opposition group at the council, criticised the authority's position as "unsustainable".
She has also complained the draft report, which was produced in October 2011 and has been seen by the BBC, was not circulated or viewed by council members.
She said: "I'm just saying to the council, why not be the flag holder here?
"Why not be at the leading edge and say, 'this is unsustainable it does not support what we want'?
"And in terms of trying to deliver a good deal for pensioners, what about the 2,500 people in Kent who die every year [from smoking related illnesses] who never get to call on their pension?"
The council will discuss the issue at a meeting later.