Council defends arms trade investments

SUFFOLK County Council leapt to the defence of its pension fund today after it emerged it had invested more than £5million in companies involved in the international arms trade.


SUFFOLK County Council leapt to the defence of its pension fund today after it emerged it had invested more than £5million in companies involved in the international arms trade.

Cash from the council's pension fund has been ploughed into firms including Britain's biggest weapons manufacturer BAE Systems and jet engine producers the Rolls Royce Group.

The situation emerged following a study by peace campaigners Campaign Against Arms Trade (CAAT).

They say Suffolk County Council should not be investing in what they describe as “unethical” enterprises.

CAAT research coordinator Ian Prichard said: “We were surprised by the sheer scale of the arms company shareholdings revealed by our study.

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“These investments are unnecessary from a financial point of view: the UK arms companies in our study make up less than 2 per cent of the FTSE 100.

“Public money deserves to support public goods, not weapons.”

In total Suffolk County Council has £5.66m worth of shares in five companies associated with the defence industry out of pension fund investments totalling more than £1 billion.

But the council told The Star it was doing nothing wrong and would not be moving the shares.

Councillor Guy McGregor, chairman of the Suffolk Pension Fund Panel, said: “In managing the £1.1billion Suffolk Pension Fund, Suffolk County Council adheres strictly to government regulations.

“These regulations require us to invest in a wide range of investments, which are made via fund managers who recommend suitable investments.

“We require our investment fund managers to look for companies with good standards of corporate behaviour and those which consider the environmental impact of their work. There are no government requirements to follow any particular social, environmental or ethical criteria.

“We expect investment fund managers to select investments which will maximise the return for the fund without taking any undue risks, and we meet regularly with our fund managers to monitor their work. We have a duty to our pensioners now and in the future to make sure we have returns that enable people to receive a pension. If we do not, the cost of that will have to be borne by the Suffolk council tax payer.

“All pensioners in the Suffolk Pension Fund are welcome to attend the annual meeting of the pension fund and raise any queries there.

“This meeting is normally held in February, and I would be delighted to see them there.”

However the Reverend Cliff Reed, minister of the Suffolk Unitarian Church in Friars Lane, Ipswich, sounded a note of caution for the council warning the investment may be frowned upon by pacifists and perhaps should be a matter for public debate.

“It might be that if this issue is raised the county council would seek to find out what people think about it,” Mr Reed said.

“Maybe we should use democracy to answer these questions,” he added.

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BAE Systems in summary

BAE Systems, in which the county council has 876,400 shares at a value of £3.34 million, is behind a number of aircraft including the Tornado , Harrier and Hawk jets.

The firm is also leading partners in joint programmes for military and civil aircraft such as the Eurofighter, and Joint Strike Fighter.

BAE also specialises in radar, artillery and guided weapons.

It is the prime contractor for the Royal Navy's new Type 45 destroyers and the Astute class nuclear-powered attack submarine.

BAE Systems is currently the subject of Serious Fraud Office investigations into allegations that it paid £1million to Chilean dictator Augusto Pinochet, and operated a £60 million “slush fund” providing “hospitality” for Saudi officials connected to a massive UK-Saudi arms deal.

BAE denies the claims.

Other firms which Suffolk County Council has invested in:

Armor Holdings - 71,400 shares valued at £86,394

General Electric - 21,400 shares valued at £188,751

Rolls Royce Group - 767,880 shares valued at £2,022,407

Rolls Royce Group B - 23,309 shares valued at £23,431.34