This project will provide targeted research and training to empower union branches, organisers and union representatives to challenge existing investment strategies for public sector pensions. It will focus on democratising local authority pension funds, redirecting them towards a just transition and the new economy and away from fossil fuels and the speculative economy – promoting a structural shift in existing economic relations.
We will run two full-day training workshops for key trade union activists from around England and Wales in late Spring 2016. This will build on Platform publications, including the recently published “Our Pensions, Our Communities, Our Planet: How to reinvest our pensions for our good?” with Trade Unions for Energy Democracy, and a forthcoming report on Reinvestment options.
After the workshops, we will identify key active trade union branches and produce five targeted research briefings on how specific local authority pension funds can be invested to create decent jobs, cleaner energy, more and better social housing and safer pensions, instead of destroying our climate future.
Currently, most of the £220 billion held by local authority pension funds in the UK serve the interests of private capital. Investment strategies are heavily influenced by financial advisors based in the City of London. £14 billion of council workers’ pensions are invested into fossil fuels extraction – Greater Manchester alone has £1.3 billion in oil, gas and coal. And then there’s arms manufacturing, financial speculation, tax-dodging.
Public sector pension funds are run in an undemocratic and untransparent manner. In part because pension investments appear complex and boring, we end up with funds that are capture by elite interests, destroy the climate and don’t serve local economies or jobs.
But this doesn’t need to be the case. The Corbyn moment is creating space to push for a shift towards an economy that serves rather than exploits the public.
Meanwhile, the fossil fuel divestment has opened up incredibly opportunities to argue about where capital goes. Thousands of pension-holders, campaigners, environmentalists have mobilised across the UK, and demanding an influence over the allocation of capital. But divestment from fossil fuels can take a narrow approach – persuading investors to move holdings out of oil, gas or coal, and replacing them with other multinational corporates focused on extracting wealth. Instead divestment can be coupled to a more transformative shift – away from the speculative and extractive economies, and towards a new economy, grounded in public, community and worker control.
We believe that workers need to be at the centre of shaping how we re-allocate capital. Both because they understand the local needs of economy, and because these pensions are also their future. Pension fund managers try to shut down debate argue that the pensions belong to a group of individual pension-holders, and only the manager can represent their interests best. We aim to turn this neoliberal individualised approach to pensions on its head. Public sector pensions are collective institutions, that should be answerable to the collective will relevant workers. Instead of stripping capital allocation of politics, we can inject politics back into the process.
Shifting Capital is part of a wider Platform project to make public sector pensions public again: redemocratising decision-making, taking control away from City of London financial firms. Ensuring safe pensions for workers, while driving a sustainable reindustrialisation, includin rapid expansion of social housing, public transport, community-run renewables.