Croydon Council this week moved to cancel all its investments in tobacco, pay-day loan firms and the arms industry, as Labour’s new administration at the Town Hall seeks to ensure a more ethical approach to the way the borough’s affairs are managed.
In a 2014 version of “turning swords into ploughshares”, the decision of the pensions committee this week could see a large chunk of Croydon’s £700 million pension fund being re-directed into an innovative local housing fund, with the potential of helping to resolve some of London’s housing shortage while also delivering even better returns on investment than shares in Big Tobacco that has always been so beloved of the Conservatives.
“I am pleased to report that Croydon’s new Labour council has taken the decision to end investment in tobacco shares and to move that part of the fund into an ethical fund which excludes tobacco, thus fulfilling our manifesto pledge,” John Wentworth, councillor for Upper Norwood and chairman of the pensions committee, told Inside Croydon.
“The reasons behind the decision are sound in terms of our commitment to public health and our duty to produce the best returns for our pensioners and fund members.
“The ethical fund has produced returns which are equivalent or slightly better than that containing tobacco shares, so we judge there to be no risk to the pension fund. Tobacco shares as a long-term investment are increasingly risky. There is much potential litigation, a declining market and the threat of increasing legislation, such as plain packaging and display restrictions,” Wentworth said.
“Overall, the decision is good for Croydon, setting a clear ethical stance and also good for our pension fund.”
Labour say that the move is part of what they promised would be “a radical approach to overhauling and managing the council’s finances”.
In their election manifesto, Labour suggested that buying or building property in Croydon would be a real alternative, “…in order to keep our much-needed funds within the borough… which could provide a return to the pension fund from a proportion of the sale of private housing while also delivering additional affordable housing”.
With the price of an average home in London reportedly spiralling by £4,000 per month so far this year, putting council funds into property appears to be an example of enlightened self-interest.
Neighbouring Sutton Council, still under LibDem control, this week announced it is to establish a house-building company and, for the first time in 25 years, actually embark on building council houses to address the homes crisis.
“We want to build new council housing and new private housing with a social purpose at its heart,” Jayne McCoy, the chairman of Sutton’s housing committee, said. “It will give people more choice and a greater chance of getting on or moving up the housing ladder.
“By being involved in the development of new homes, we can stipulate that they are only for Sutton residents and make sure there is a focus on the housing we want such as family homes, rather than expensive studio flats.”
Coming to Croydon
- South Norwood Arts Festival, July 5-20
- Croydon Folk and Blues Festival, July 12
- David Lean Cinema: Half of a Yellow Sun, July 17
- Love Norbury launch event, July 19
- David Lean Cinema: Pantani: Accidental Death of a Cyclist, July 21
- David Lean Cinema: Tracks, July 24
- Fragile, Spread Eagle Theatre, July 24-26
- CODA’s Midsummer Night’s Dream at Wandle Park, Jul 30-Aug 2
- David Lean Cinema: Locke, July 31
- Elm Tree Cottage garden open day, Aug 10
- Norwood Society Talk: War Memorials, Sep 18
- Streatham Common 6M race, Sep 27
- Norwood Society Talk: From Fire Station to Theatre, Oct 16
- Norwood Society Talk: Lambeth’s Archives, Nov 20
Inside Croydon: Croydon’s only independent news source, based in the heart of the borough: 407,847 page views (Jan-Jun 2014)
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