The Chair read the following statement to members;

Merseyside Pension Fund (MPF) takes Environmental, Social and Governance (ESG) issues including human rights extremely seriously. Our recently revised Investment Strategy Statement includes our approach to Responsible Investment. This is primarily framed around engagement with stakeholders to ensure that issues of concern to pension scheme members are appropriately prioritised and acted upon, in accordance with our investment beliefs and objectives.

Accordingly, MPF has a long-standing track record of engagement with companies that the fund holds investments in. This is primarily conducted via our membership of the Local Authorities Pension Fund Forum (LAPFF) but also, on occasion, via direct engagement with relevant companies. LAPFF’s engagement work covers a broad spectrum of global human rights issues, encompassing modern slavery in global supply chains to the impacts of mining operations on local communities in Brazil. LAPFF is a member of the Investor Alliance on Human Rights, which is currently leading an investor engagement with companies with operations in Myanmar.

When credible concerns about human rights or breaches of international law are raised, MPF considers it right and proper that these are taken seriously with due regard to the legal framework and the principles of natural justice. MPF is mindful of the responsibility of investors to respect human rights as set out in the UN Guiding Principles on Business and Human Rights, of which the UK Government was a leading proponent.

Regarding MPF investments in companies with reputed commercial links to the  Israeli settlements in the Occupied Palestinian Territories (OPT) which are generally regarded as contrary to international law, committee members have been presented with detailed advice and guidance via reports and workshops on the overall framework in which MPF conducts its responsible investment policy and the specific issues relating to the OPT. Based on this, officers have taken a view that further company engagement is required before any decision can be properly made on the Fund’s continued investments in those companies. This advice forms the basis of the recommendations to Pensions Committee on this matter for its meeting on 23 February.

The Director of Pensions introduced the report which outlined actions that could be taken in response to concerns expressed to the Committee about the Pension Fund’s investment in companies that are alleged to be facilitating the construction and maintenance of Israeli settlements in the Occupied Territories of Palestine (OPT).

A discussion ensued, Councillor Brian Kenny stated that human rights are universal and that the Labour Party applies its principles consistently and without discrimination and does not single out one country for differential treatment. It was highlighted that legislation currently going through parliament could affect the decision on the table at the committee.

Members noted that the report was generalised, and some echoed the concerns of Councillor Kenny. It was discussed that Robert Jenrick MP, had moved an amendment in Parliament which would affect the law on this matter.

The Chair stated that the Pensions Committee was not being asked to divest but to undertake further engagement with the investee companies in line with responsible investment policy and thanked the officers who had been involved in navigating the issue and who had brought a report that was consistent with research, the current legal framework and the responsible investment policy.

Councillor Jeff Green stated that he did not believe it was the role of the Pensions Committee to consider divestment in companies on political grounds and that he supported the aims of the Bill going through Parliament that would make it unlawful for public pension funds to do so.

A motion was put forward by Councillor Brian Kenny and seconded by Councillor Adrian Jones that the recommendations be withdrawn and deferred to a future meeting to give the Pensions Committee time to review the situation and questions about ethical investment for the future. This was put and lost 3:6.

The Committee then voted on the officer’s recommendations from the report, this was moved by the Chair and seconded by Councillor Chris Carubia, this was put and lost 4:5.

Some Members expressed the view that they did not want the work done on this matter to disappear and that it should be brought back to a future meeting.

A further motion was then put by the Chair and seconded by Councillor Joe Walsh that the matter be deferred to a future meeting. The motion was carried 7:4.

Resolved - That  the matter be deferred to a future meeting.