Local democracy under attack by George Osborne

The government wants the power to overrule council pension investment decisions. George Osborne wants to grant the Secretary of State for Communities and Local Government the ‘power of intervention’, meaning they could override decisions made via democracy by local councils.

At the moment local authorities have the right to divest their pensions on an ethical basis if they wish. It’s been a part of our democracy for years and was vital in Britain’s ability to boycott apartheid South Africa. More recently, councils across the UK have adopted fair trade principles, and removed tobacco and arms companies from their investment portfolios in response to local concerns. Councils have also started to move away from fossil fuel investment.

Currently pension funds rely on companies such as BHP Billiton, Anglo American and Shell which run huge fossil fuel extraction projects in the global south. These projects are displacing and threatening to displace communities in the global south from their land. Some of these fossil fuel companies have been accused of complicity in human rights abuses. For instance, BP’s association with the paramilitaries which kidnapped and tortured union activist Gilberto Torres in Colombia.

In another part of Colombia London-listed mining giants Anglo American, BHP Billiton and Xstrata operate the Cerrejón mine. It is the largest of its kind in South America. Indigenous groups, farmers and trade unions are demanding a halt to the expansion of the mine. It has displaced huge numbers of people and dust and pollution from the mine has poisoned water supplies and the air.

Coal mining is having devastating impacts upon people in Indonesia as well. In Samarinda, East Kalimantan’s capital, major floods have become commonplace. The surrounding area was largely peat swamp that catches water but this has been destroyed by mining. Large mining companies such as BHP Billiton and Bumi own numerous mines throughout the country. They have been linked to forced displacement, local pollution and rainforest destruction. Many of the areas with coal mines also have serious energy access problems and the coal produced does not support the local people.

In Canada communities are fighting extensive tar sands extraction on their tribal lands as well as an enormous proposed pipeline. BP and Shell as well as many other fossil fuel companies have investment in the tar sands mining in Alberta. The project has been described as the most destructive industrial project on the planet. The Athabasca river delta has been devastated by deforestation, open pit mines and ponds of toxic waste. Abnormally high rates of cancer and immune system diseases have been found in neighbouring indigenous communities, where people have hunted and fished for generations.

These projects are testament to the destruction wreaked by fossil fuel extraction and are a pressing reason to divest. We need to keep hold of our councils democratic rights to do this.

Used in another way council pension funds can be a powerful positive reinvestment tool. In the UK our energy system makes millions of pounds for the Big 6 energy companies but leaves millions of people in fuel poverty. Local authority pension funds can supply vital funding for democratically controlled clean and affordable energy. And it’s already happening. Just one example is Lancashire county council which has invested £12m in Westmill, a community solar project in Oxfordshire.

It is crucial that we stop government from rolling out these changes. Please sign the petition here.

By Sam Lund-Harket: globaljustice.org.uk

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