UK councils have ‘conflict of interest’ on fracking - report
Councils that have been picked out as responsible for potential fracking areas have assets in firms by way of their pension funds, according to the report published late on Sunday.
The newspaper pointed out that Lincolnshire County Council’s pension fund has 1.9 million pounds ($3.2 million) invested in French company, Total. Total was the first major oil company to make incursions into Britain with the intention of seeking shale gas profit.
The company has a 30 million pound ($50 million) holding in two exploration ventures in the northeastern county.
West Sussex County Council has some indirect investments in both Cuadrilla and3.5 million pounds in Centrica. The southern county was the site of ongoing protests in Balcombe last summer, which residents reported ‘scarred’ and ‘divided’ the village’s inhabitants after considerable opposition erupted when Cuadrilla announced proposals to drill in the county.
The council stated that its investment equated to some 0.001 percent of the total value of its £2.45bn pension fund. “Any indirect investments made by the pension fund’s investment managers would not have any influence at all in determining a planning application,” the council said in a statement to the paper.
Last Wednesday, Cuadrilla Resources said that it is continuing to consult with residents on proposals for two shale gas exploration sites in the Fylde area of Lancashire in northwest England.
The Greater Manchester Pension Fund (GMPF) invests on behalf of Salford and Trafford councils. The area is being tested currently for shale gas by a company named IGas. The IGas group was invested in by the Henderson group, which itself has GMPF as a shareholder.
Each body contacted by the paper maintained that the investments did not constitute a conflict of interest. However, environmental activists have voiced outrage.
“It’s a worrying discovery. Fracking is already a dirty enough industry without getting mired in the murky waters of conflicts of interest. Councils must disinvest and show local voters that they can be trusted to put the interests of their constituents first when making crucial decisions on fracking applications,” Simon Clydesdale, energy campaigner for Greenpeace UK, told the Independent.
Lincolnshire’s assistant director of resources, David Forbes, stated: “The pension scheme operates within a set of clear investment principles and is overseen by the pension committee, which makes its decisions independently from the county council.”