'Crashing' oil investments wipe £1.75bn from council pension funds

Over £1.75bn has been wiped from UK council pension funds due to "crashing" oil investments over the past three years, analysis from Platform London has found.

The research, undertaken by Transition Economics, found that the combined investments by 56 local government pension funds into nine leading oil companies had “collapsed” by half, falling from £3.6bn in April 2017 to £1.8bn in November 2020.

The largest losers, according to the analysis, were pension funds from Greater Manchester Pension Fund (GMPF), which reportedly lost £375m and West Yorkshire, which reportedly lost £211m.

The analysis stated that the losses faced by GMPF are equivalent to 2.2 per cent of the total fund value, or over £1,000 per member, whilst West Yorkshire's losses were equivalent to around £740 per member.

The campaign also noted that whilst an article from Reuters in early 2020 reported Greater Manchester and West Yorkshire funds as claiming that they would have lost £300m and £160m respectively over three years to 2019 if they had divested from fossil fuels, the losses from oil performance almost entirely or entirely eradicate this gain.

Adding to this, Platform London emphasised that whilst three-quarters of local councils have declared a climate emergency, only a minority of council-run pension funds have pledged to divest their investments from fossil fuel holdings.

Commenting on the findings, Platform campaigner, Robert Noyes, stated: "It is well past time for pension funds to drop oil & gas stocks, both for the climate and their future valuation.

“Funds like Greater Manchester, West Yorkshire and Nottinghamshire lost billions by sticking with BP and Shell. They should have listened to divest campaigners. Instead, the burden is being dumped on the public, pensioners and the Global South.

"The oil and gas industry has no credible plan for the imminent future where electric vehicles are cheaper than fossil cars and where countries put limits on oil and gas extraction.

“If councils are sincere about tackling the climate emergency, their pension funds need to invest in the future, not the past, and divest from stranded oil and gas stocks."

Campaigners have previously called on GMPF to divest from fossil fuels, claiming that the fund was "out of touch" with public sentiment.

GMPF and the West Yorkshire Pension Fund have been contacted by Pensions Age for comment.

    Share Story:

Recent Stories


Making pension engagement enjoyable through technology
Laura Blows speaks to Nick Hall, business development director and Chartered Financial Planner at UK-based Wealth Wizards about the opportunities that technology provides for increasing people’s engagement with pensions and increasing their retirement wealth. Please click here for an edited write-up of the video

ESG & DC – creating the right tools
In the latest of our series of Pensions Age video interviews Francesca Fabrizi, Editor in Chief of Pensions Age is joined by Manuela Sperandeo, Head of Sustainable Indexing EMEA, BlackRock and Mark Guirey, Executive Director, Asset Owner and Consultant Coverage - MSCI to discuss some key trends of ESG investing among UK pension funds today. Please click here for an edited write-up of the video

Savings and finance at retirement
Laura Blows is joined by Claire Felgate, Head of Global Consultant Relations, UK, at BlackRock, to discuss savings and finance at retirement. Please click here for an edited write-up of the video

Cost transparency
Pensions Age editor, Laura Blows, discusses investment cost transparency and savings with Aon’s Neil Smith and Chris Hawksworth. Please click here for an edited write-up of the video
Multi asset credit
Pensions Age editor, Laura Blows, discusses multi asset credit with Royal London Asset Management senior fund manager, Khuram Sharih

Advertisement Advertisement