Legal advice prevents council selling shares in pension fund
HIGHLAND Council is being forbidden from selling millions of pounds of tobacco shares, regardless of the ethical concerns of individual councillors.
The council had sought legal advice about the potential of withdrawing its £27.2million pension fund investment in the tobacco industry.
The authority has now been advised that it “is not entitled to decide to exclude investments on any ethical grounds”.
Legal advice also suggested that councillors who voted in favour of withdrawing tobacco interests could be liable to punitive penalties, including censure, suspension and disqualification.
At a council meeting in Inverness yesterday, members admitted that they had no option but to accept it.
Councillor Carolyn Wilson, chairman of the authority’s resources committee, said: “I don’t think we have any choice but to accept the legal advice.”
Council leader Dr Michael Foxley added: “We are all aware there are strong and differing views on ethical investment policies in this chamber.
“There are four councils in Scotland who have ethical investment policies: Dundee, Falkirk, Edinburgh and Renfrewshire, but that does not apply to their pension funds.”
Councillors agreed that they could not exclude investments on ethical grounds as the law currently stands.
The council’s holding in tobacco was exposed in a Press and Journal investigation 17 months ago.
The investment in tobacco stocks is seen as controversial because council tax is spent on anti-smoking initiatives and one of the authority’s long-term policies is “building a fairer and healthier Highlands”.