19th March 2021

A lot’s been happening!

Dear FFGM Supporters,

In this newsletter
New data on dirty local government pension investments
Our correspondence with GMPF
Greater Manchester Councils speak up

Action you can take
Union members: petition to sign

Despite the pandemic, we’re still working hard at Fossil Free Greater Manchester to persuade the Greater Manchester Pension Fund (GMPF) to divest from fossil fuels.

But we’re not alone.

  • Anchor Platform London published new data on fossil fuel holdings by UK local government pension funds. It attracted lots of press attention.

  • Manchester City Council revealed that it’s written twice to GMPF in the last year calling for divestment.

And to cap it all…

  • Six of the ten Greater Manchester councils have just written to GMPF about divestment and its woeful carbon neutrality target, and

  • Tameside’s leader and chair of the GMPF isn’t happy about it. They say they will be “zero carbon” by 2030 but still won’t divest. Bonkers!

Now it’s your chance to add your voice

Anchor Our correspondence with GMPF

We’ve been having fun at FFGM writing to the Fund and reading their responses.

Our latest bout of letter writing began when we saw GMPF’s 8-page letter to Afzal Khan MP (Manchester Gorton). It contained a dizzying raft of arguments for fossil fuel investment. This was really handy, because it helped us better understand how GMPF defends its position. The Fund soon received a 10-page letter from us challenging every one of their arguments. We summarised that correspondence in our fact check briefing, which was sent to every councillor in Greater Manchester.

GMPF soon popped up again with their response to our response! They’d apparently realised that most of their arguments didn’t bear scrutiny, and their January letter was confined to a mere 3 pages. It replied to some key questions from us, which included:

  1. Exactly how much the Fund currently has invested in fossil fuel companies

  2. How it calculated its earnings from its fossil fuel investments (apparently massive)

  3. How its engagement with these companies had changed their core activities (it hadn’t)

We weren’t impressed with their replies. Most ludicrous was their claim that they couldn’t tell us the value of their fossil fuel investments because they were ‘not aware of a singularly accepted definition of what constitutes a fossil fuel company’. We also thought they’d been very selective in their choice of dates for measuring their return on fossil fuel investments. So we wrote back suggesting the Fund use the widely accepted Carbon Underground definition of fossil fuel companies and also asked them to tell us their returns on fossil fuels using a longer time frame.

GMPF’s latest response arrived on 8 March. (We can’t fault them on engaging with us.) This letter was even shorter – just over two pages and acknowledges that:

  • The Carbon Underground 200 index does appear to provide a reasonable methodology … to (identify) publicly listed companies that own fossil fuel reserves.’

  • Platform’s latest analysis (see below) appears to have correctly identified, post hoc, that the market value of fossil fuel energy companies reduced significantly from the time of the economic shutdowns precipitated by the COVID pandemic.’

But of course, despite accepting Carbon Underground’s definition, they still haven’t told us the value of the Fund’s holding in fossil fuel companies, and ignored our evidence that fossil fuel shares have been performing badly for much longer than the pandemic. And the Fund still hasn’t published its annual report and accounts for the year to 31 March 2020, which were due by the end of November.

If you’d like to see the correspondence, we can make it available to you. Email us at fossilfreegm@gmail.com.

The Platform Report

You may have seen coverage in the press about fossil fuel holdings by local authority pension funds. Last month the Guardian reported that, ‘local councils that have declared a climate emergency are continuing to pour money into fossil fuels through their staff pension funds.’ (Guardian 23 February.) Closer to home, Manchester’s independent news site – The Meteor – added that ‘GMPF is by far the biggest funder of fossil fuels of the 98 pension funds investigated, with a combined oil, gas and coal investment of £1.011 billion.’ (The Meteor 24 February.)

Both articles originated from a recent report commissioned by Platform London, which estimated that  £375m was wiped off the value of the Greater Manchester Pension Fund due to their oil and gas investments losing value over the past three years. FFGM estimate that, if GMPF had sold its oil and gas holdings in 2017 and reinvested the money in a FTSE 100 tracker fund, it would have lost just £99m over the same period. If GMPF had put the money into a low carbon fund which avoids oil and gas shares, it would almost certainly have lost less.

You can read more about our response to the Platform report here.

Anchor Greater Manchester Councils speak up

GMPF is controlled by the 10 councils in Greater Manchester. All the councils have a representative on the Management Panel. But because Tameside Council manages the fund on behalf of all the councils, they dominate the Panel – holding 11 of the 20 council places.

It’s difficult for us to know what conversations the councils are having with the Fund, but an article in the Manchester Evening News in February, revealed that last year Manchester City Council sent two letters to the GMPF urging it to set out its actions to divest from investment in fossil fuels, but has yet to receive a formal response.

But keeping quiet won’t help GMPF. Six GM councils (Bury, Manchester, Rochdale, Salford, Stockport and Wigan) wrote to the Fund on 3 March. The letter (not available yet in the public domain but covered in this article) urges GMPF to bring its woeful 2050 carbon neutrality target in line with Greater Manchester’s target of 2038. It also reminds the Fund that several UK local authority pension funds have already committed to fully divesting from fossil fuels, along with high profile councils such as New York. Their joint press release goes further and calls on GMPF to ‘move decisively away from its current investment in fossil fuels.’ Manchester’s lead member on environment, Councillor Stogia has also written to Andy Burnham, the GM metro mayor, to request that he adds his voice.

We warmly welcome the letter and call on Bolton, Oldham Trafford (even Tameside!) councils to sign as well.

But we add a warning – carbon neutrality is not the same as divestment from fossil fuels. It would be only too easy for GMPF to bring forward its target date for carbon neutrality and continue to invest in fossil fuel companies.

The councils’ letter calls on the Fund to ‘outline how it could move to a 2038 zero carbon target and the full policies and strategies to achieve that goal.’ We won’t be happy until we see that full divestment is not only included in that strategy, but that it’s the very first action GMPF will take. The Fund must send a clear message that the fossil fuel industry is in its dying days – and of course rapid divestment also makes complete financial sense.

To see our full response to the councils’ letter click here.

Breaking news!

Councillor Brenda Warrington, leader of Tameside Council and chair of the GMPF Management Panel issued a statement to the Manchester Evening News, that the letter from the six councils ‘looks to me like election time virtue signalling.’ Then she trotted out the usual tired arguments that divestment would compromise the Fund’s returns and GMPF is ‘seeking to change the behaviours of those companies we invest in to become carbon neutral.’ FFGM has regularly demolished these claims – see our fact check briefing.

But interestingly, Councillor Warrington’s statement added that the Fund is exploring a target to become zero carbon by 2030. That would be a great improvement on their woeful 2050 target. Here at FFGM we would welcome such a move, but of course reiterate that divestment must be the first step on the way to carbon neutrality.

AnchorAnchor Over to you …

Things are moving fast, but we must make sure that the moment isn’t lost. So, here’s how you can help.

  • Tweet the Pension Fund e.g. “Great to hear @tmbc_leader @GMPF_LGPS wants to go carbon zero by 2030. That must mean you’re divesting from fossil fuels now?”

  • Share Platform’s report on your social media

  • Write a letter to your environment and climate lead councillor

AnchorIf your council is one of those that signed the letter

(Bury, Manchester, Rochdale, Salford, Stockport and Wigan)

Please write to your council’s executive member for climate change (see list below) and:
  • Thank them for signing the letter.

  • Urge them to demand that GMPF commits to immediate full divestment, not just a change in the date for the Fund’s carbon neutrality.

  • Ask them to ensure that their council’s representative on GMPF’s Management Panel is demanding divestment at every panel meeting.

If your council didn’t sign the letter (Bolton, Oldham, Tameside and Trafford)

Please write to your council’s executive member for climate change (see list below) and:

  • Ask them why they didn’t join the other six councils and sign the letter.

  • Urge them to sign-up as soon as possible.

Some more suggestions for what you could include in your letter

Although Fund has stated the aim to decarbonise its investment portfolio before 2050, nothing has been published by way of a strategy, nor any kind of roadmap showing the steps the Fund will take.

The Fund should divest its main fossil fuel assets long before the 2038 Greater Manchester carbon budget net zero date, because selling dirty investments and purchasing clean ones is much more straightforward than decarbonising a whole regional economy, and early decarbonisation of the Fund’s investments will actually help Greater Manchester, and the economies to which it is linked, to meet its emissions reduction commitments.

The Fund divested from tobacco because it was morally unjustifiable to profit from it. Risking runaway climate-change by helping fossil fuel firms extract and burn yet more coal, oil and gas is just as unacceptable. The Fund should not profit from this reckless behaviour.

Contact details for the executive members for climate change

Councillors that signed the letter

Bury: Cllr Alan Quinn

Manchester: Cllr Angeliki Stogia

Rochdale: Cllr Sara Rowbotham

Salford: Cllr Mike McCusker

Stockport: Cllr Sheila Bailey

Wigan: Cllr Joanne Marshall

And those that didn’t sign

Bolton: Cllr Adele Warren

Oldham: Cllr Abdul Jabbar

Tameside: Cllr Allison Gwynne

Trafford: Cllr Andrew Western

AnchorNew Petition for Trade Unionists to sign

Unison North West’s climate emergency action group have started a petition. We encourage trade union members to sign it, via this link.