Newham Council Meeting - Living Wage Foundation, Cabinet Reports and Pension Divestment

This evening at the Full Council meeting in Stratford Town Hall we started with a "State of the Borough" debate with speeches from the Mayor, Rokhsana Fiaz, and updates from all 8 cabinet members.

My very short update was as below :-

"As Cabinet lead for Housing Services dealing with the immense challenges our residents face in housing was an absolute central pledge of our manifesto. I can report on some important progress we have made on meeting those promises.

In 2019 Newham Council Housing Services are used our land and money to support the Mayor to deliver on her 1000 Council homes at social rents manifesto commitment.

Also as promised we are committed to tackle homelessness with care and compassionate and we are looking to invest up to £100 million on buying or building good quality temporary accommodation for homeless families.

We have almost doubled the number of enforcement officers in our property licensing team.

We have reintroduced Tenant and Residents forums; we are spending some £200 million on planned improvements to our stock, including new kitchens, windows, bathrooms, roofs, lifts - tacking fuel poverty and also the climate change emergency;

We are due to open 4 local housing hubs across the borough and have established a new team of named officers with responsibility for all council homes in the borough.

More broadly, addressing this crucial issue of housing is central to our Community Wealth Building Strategy, and developing an inclusive economic strategy. So we will be stepping this up in 2020".

After this debate our Newham Partnership update (and Q&A) was by Lucy Bannister from the Living Wage Foundation. Newham is finalising becoming an accredited Living Wage employer. Last year we got 700 Newham social care workers a Living Wage pay rise. As contracts come up for renewal we implement a Living wage clause.

Last week we took back into public service 50 Park Gardeners, many of whom also got a pay rise. Lucy explained the history of the Living Wage Campaign (it was born in East London) and the advantages to employers as well as staff. They are also thinking of setting up a new campaign for "Living Hours" (zero hour contracts etc).

Next were questions from the public and a number of questions had been submitted on why our Newham Staff pension fund should divest from carbon. There was a substantial written response and an offer from the Chair of the Pension Committee to meet and discuss divestment further.

We do have I think the lowest exposure to carbon investment in all 33 London Council pension funds (1.2%). The main reason for this is our fund managers think carbon intensive industries are not good investments. 

"Climate Change and Bangladesh: First Affected. Worst Affected" (Pension Carbon divestment)

(I am due to speak at this seminar as a Councillor & trade union pension activist).

"Fossil Free Newham, Tower Hamlets Divest and Hackney & Tower Hamlets Friends of Earth are teaming up to screen '30 Million', a film which focuses on the plight of Bangladesh in the face of Climate Change. Following on from the film, we will be having a few short talks from guest speakers and a question and answer session.

The film is so titled because with just a one metre rise in sea level, 30 million inhabitants of Bangladesh could be displaced. We believe that it is essential to make ourselves aware of these facts and the plight of those in the frontline, battling against such fundamental environmental change.

Divestment campaigns across the globe are seeking to lessen the impacts of Climate Change by stopping the flow of money into dirty energy companies. We've already seen big commitments from institutions such as the Rockefeller Brothers Fund, the City of Oslo and, most recently, New York City. Closer to home, Waltham Forest and Southwark councils have both committed to full divestment, whilst Hackney and Haringey have partially divested.

Join us on Saturday, April 21st 1pm to 2.30pm at the Canvas Cafe, Hanbury Street, to learn more about how Climate Change is affecting frontline communities, and what you can do to help!

The venue has a limited capacity, so get your tickets soon! Register here

The Canvas: Cafe & Creative Venue
42 Hanbury Street
London
E1 5JL"
View Map

"UNISON launches campaign to divest pensions from carbon"

I chaired a packed 10th UNISON annual Local Government Pension Fund seminar yesterday.

The "Divest Campaign" is potentially one of the most significant things we can do as a union, not only to save our planet but also to save our pensions future.

Will blog further on the seminar later.

Guide will help members of local government pension schemes push for changes in the investment of their funds

A campaign to encourage local government pension funds to divest from carbon will be launched today (Wednesday) by UNISON.

UNISON’s step-by-step guide is designed to help members of local government pension schemes push for changes in the investment of their funds. The aim is to explore alternative investment opportunities, allowing schemes to sell their shares and bonds in fossil fuels and to go carbon-free.

Chair of UNISON’s policy committee James Anthony said: “Pensions are meant to safeguard our future, but that future is threatened by the burning of carbon in fossil fuels like coal, oil and gas.

“This campaign empowers people to hold their pension funds to account. If you contribute to a pension then it’s your money that’s being invested, and so it’s only right that you should have a say in where it’s invested.”

Figures published last year revealed that £16 billion was invested in the fossil fuel industry by local government pension funds*. At its annual conference last year, UNISON made the decision to campaign for divestment from these companies because of the devastating consequences that a changing climate will have on people, societies and ecosystems.

In addition to the threat of climate change, the UNISON campaign highlights other reasons why continued investment in carbon threatens the value of pension funds. For example, new government regulations for fossil fuels have raised the costs of high-polluting industries and reduced their investment appeal. Equally, emerging clean and green technology has created new and lucrative business opportunities for funds.

With five million members of local government pension schemes, and over 13,000 different employers paying into them, UNISON believes its campaign will resonate with a wide audience and is in a strong position to influence the pensions agenda".

Hat tip https://www.unison.org.uk/news/press-release/2018/01/unison-launches-campaign-divest-pensions-carbon/

Councillor Report 3.1.17 - "Could we become Haringey Development Vehicle (HDV) Two?"

This is my latest written report (previous one 7 December 2017).

Council Issues
Meeting with Senior Council officers

13 December. I met again with other concerned backbench Councillors senior officers at Newham Dockside to discuss and examine reports on the way that the Council buys and manages commercial properties for investment purposes. The meeting was constructive and informative but I still have huge concerns about the governance arrangements and oversight. Newham is borrowing hundreds of millions of pounds to invest in property. We are still being refused sight of the Newham Council reports on the London Stadium disaster and the reasons for the £50-60 million pound losses. This is an executive decision not to release and not by officers.

Newham Council Investment & Accounts meeting
14 December. At this meeting while discussing the minutes of the previous joint Audit meeting the Director of Finance confirmed that the £40 million original loan to the London stadium is not being “written off” but swapped in some “debt for equity” exchange? Since the loan was recently declared in our annual accounts as “impaired” (currently worthless) I do not know what on earth that means? Nor what happens to the lost £4.4 million interest charge, the £5 million loan for investments in the Olympic South Park and the £12 million of "working capital”.

I was very shocked to hear that some Newham Schools are allowing private contractors to not enrol new starters into the Local Government Pension Scheme. This will penalise already low paid female school staff and is of course a disgrace and these schools should be named and shamed.

At the meeting there were members of the Newham Carbon Divestment campaign. I suggested that they should be allowed to make a presentation at the Newham Pension AGM.

Newham Cabinet Meeting. Could we become Haringey Development Vehicle (HDV) Two?
21 December I attended Cabinet as an observer and spoke to the Mayor about privatisation of Council services and also a proposal to set up some special vehicle to run all Newham’s property assets (we are talking potentially billions of pounds). I am astonished that this is even being considered before we learn the lessons on what went wrong with the London stadium special vehicle. This could be an even worse political mess than Haringey Council has found itself over its property development vehicle. I asked the Mayor if he would bring any such future plans back to a full Council meeting for approval but he did not agree and said it would go to Labour Group.

Fortunately Cllr’s Hussain and Clark managed to amend the proposal to just doing a review of existing arrangements and nothing else.

Review of Scrutiny arrangements
The Select Committee on Communities and Local Government has recently published a hard hitting report criticising many Councils for inadequate Scrutiny of Executive decisions. I have publicly commented on this report with and I am pleased that Scrutiny Chair, Cllr Rokhsana Fiaz, will be taking the recommendations to the Overview & Scrutiny Committee.

Surgeries and case work
I have attended 2 surgeries per month in Vicarage Lane Community Centre and Brassett Point Residents Association room. Casework regarding Academies, ASB; parking ticket policy; disabled adaptations disrepair, speeding cars, Right to buy, insurance and forming a Tenants & Residents group. I was most unimpressed with repair failures in the Church Street block run by One Housing Group and I am trying to arrange an inspection. I have received a petition from residents which I will present at the next Full Council meeting.

Ward Issues

Ward meeting/Xmas Social
7 December I attended ward meeting and went on to enjoy the Xmas social. Many thanks to Lyn Brown MP for attending and the organisers for a great evening.

West Ham campaigning & petition on lack of social homes in Ford Showrooms development
We are waiting for the planning meeting. There is now a West Ham Labour ward petition at Change.org http://chn.ge/2iq4UKb. Please support this petition.

Durul Jannah Community Centre, E15 – Planning permission
19 December. I spoke in favour at a hearing for a change in planning permission for this centre. Officers are opposed but I think they have got it wrong over this issue. I was supported by Cllr Forhad Hussain and Cllr Mas Patel. Unfortunately due to a mistake with the paperwork the application had to put on hold but I hope this can be sorted out as quickly as possible.

Other Issues

Labour doorstep
9 December after Surgery I went door knocking & leaflet distribution in Stratford ward with a local Councillor and activists.

Councillor Candidate’s selection meeting postponed.
Apologies to ward members who had reserved 9/10 December for the chance to elect candidates for the local elections in May 2018. Due to a number of appeals outstanding for applicants who did not pass the initial interview the Regional Labour Party has postponed the selections. No new date yet.

Mayoral “trigger ballot” to be rerunThe Mayor, sent out a press release saying that he wants a rerun of his selection process as the Labour Candidate for Executive Mayor. I thought his release was extremely odd but it does appear that he concedes that the process was “rigged” and that it needs to be rerun. I strongly support it being redone but think that there is not enough time for a Mayoral “Trigger” and selecting Councillor candidates, so I believe that there needs to be an open selection process for our Mayoral candidate.

London Collective Investment Vehicle (CIV)
11 December I attended with UNISON colleagues for the public part of the business meeting. The CIV is planning to manage nearly all Local Government Pension funds in London (including Newham). However, the governance arrangements are nonsensical since there is no beneficiary representation.

Anti Academies Protest Hallsville School
23 December I attended a successful and well organised protest outside Hallsville School in Canning Town with parents, teachers, children and 4 other Newham Councillors (including are very own John Whitworth). I was quoted in the Newham Recorder that the Council must raise it game since schools are blaming it for “forcing” them to become academies due to lack of support.

UNISON
I am standing again for election as the Greater London UNISON Regional Finance Convenor (for the 10th year)

Workers Memorial Day 2018
Date for future is Saturday 28 April 2018 when West Ham Labour Party and local trade unions will be remembering all those killed at work or who have died of work related ill health at the Three Mills Green Memorial.

Living wages in Newham Schools
As a school governor I have sent in a question to the next Newham Governors Forum asking all schools to declare whether they pay a London Living wage to all their staff (including agency and contractors)

Donation in lieu of Christmas Cards
Once again I made a donation to a charity rather than send any Christmas cards. This year to the Magpie Trust which helps homeless families in Newham.

Congratulate Seyi Akiwowo
Finally, I think we should congratulate your ward chair (& Forest Gate Councillor) on her contribution to the UN about on-line hate and founding the campaigning group Glitchuk.

If any member wishes to contact me about this report to discuss any aspect please do not hesitate to do so.

Regards

John Gray
West Ham Ward Councillor

"Why fossil fuel divestment isn't the answer"

Last month I went to a well attended public meeting on this topic in Forest Gate Coffee7 and a Chatham House rules seminar in the City. This article today in Professional Pensions reflects what I think and said at those meetings.

John Gray says it's better to reduce carbon exposure over a longer period while seeking suitable alternative investments

I am sure that many pension trustees will have been approached by both beneficiaries and climate change activists concerned about investments in fossil fuel industries. In local government the pension funds are often seen as belonging to the council so residents are also lobbying councillors and pension board members about divesting from carbon.

‎Like so many things about pensions, this topic is important but complex and definitely in the 'difficult box'. From my perspective as a councillor on one Local Government Pension Scheme (LGPS) and as a union-appointed pension board member on another, I firstly try to make it clear that local government pension funds belong to its active members, its deferred members, its pensioners and dependents. Not to the council and definitely not to councillors.

The fund must be invested in the interests of beneficiaries.

Secondly, unlike in the private sector, there is no Pension Protection Fund for the LGPS nor does it have an explicit crown promise like other public sector schemes. 

While it may be unthinkable for many good reasons to imagine an LGPS fund going bust, trustees and those responsible for pensions have to think the unthinkable and in reality, who really knows what will happen in the long term? Due to the LGPS employer contribution cap, if future pension cost is more than 13% then either staff will have to pay more or benefits will be reduced.

What campaigners, who are rightly deeply concerned about the risk of climate change, should be doing is not just lobbying councillors and their officers, but building links and engaging with council staff and their trade unions. It is after all their deferred pay, their pension future, their money.

This doesn't mean that council pension funds should not be examining both the real financial risks ‎of investing in carbon industries but also be conscious of the impending Armageddon of our planet if we do not control our carbon emissions. 

Existing investments in carbon are usually valued on the basis of their proven reserves of coal, oil or gas. It is becoming clear that much of these reserves may never be mined or pumped out, since if they were to do so it would burn the planet. These so called 'stranded assets' are therefore likely to destroy the value of investments in carbon industries.

While to me the case for disinvestment in carbon is unanswerable, I do not feel divestment is the answer. Many calls for divestment want pension funds to sell all their carbon investments within five years. Disinvestment is a call to reduce exposure to carbon over a longer period while seeking suitable alternative investments.

It is probable that the use of fossil fuels will continue but hopefully we will see a significant reduction. It is arguable that at this time there are not sufficient alternative 'green' energy investment opportunities available. This will change but when?

I also feel tactically that calling for the divestment rather than disinvestment from carbon will play into the hands of climate change and other ESG sceptics in the industry, who would relish the opportunity to attack and rubbish total divestment, when they know that the case for disinvestment over time is so powerful.

Do not underestimate the resistance to such change in the industry. While there is much good practice, many professional practitioners may 'talk the talk' on climate change issues but are in reality 'greenwashing'. Beware!

John Gray is a member of Tower Hamlets Council Pension Board, writing in a personal capacity