Should the council invest public money ethically?

Argyll and Bute Council has not ruled out investing public money in arms manufacturers or pornographers as it faces a backlash over its £155 million deposit in the state bank of Qatar, where homosexuality is punishable by death.

 

Following revelations on Oban Pride weekend that Argyll and Bute Council invested taxpayers' money in Qatar National Bank, councillors have been asking whether the local authority should adopt an ethical treasury strategy.

 

No it should not, the council's chief finance officer Kirsty Flanagan told the Policy and Resources Committee in December.

 

'It's not routine to have an ethical policy,' she said, 'and the treasury advisors said it is a difficult area, that's fairly subjective, and where do you draw the line, as there could be a number of ethical considerations, and different people will have differing views.

 

'Our treasury strategy, and the best practice and our code of practice, is that we invest based on three principles: one's security, one's liquidity, and one is return.'

 

The Courier's sister title The Oban Times asked the council where it drew a line, if at all.

 

The question asked was: if a counterparty, say an arms manufacturer, or a pornographer, or a casino, or a tobacco company, or a coal mine, or a Russian bank, satisfies those three criteria, what other standards, if any, would stop Argyll and Bute Council investing in it?

 

A council spokesperson responded: 'We are committed to supporting the interests of all our communities.

 

'The vital funds raised from investments help to resource services that support all our communities. As indicated at the committee meeting, we are planning to review our treasury strategy.

 

'We will also continue to work to identify ways in which we can support diversity and inclusion.'

 

Ms Flanagan added that £5 million invested with Qatar National Bank matured on  December 13, and due to the cash flow projections and partly because the council had repaid some of the loans early, it was not looking to renew that investment at this stage.

 

But, as previously reported, Argyll and Bute Council has invested in banks in other countries where homosexuality is a crime and many of the deposits are still there.

 

The council had £117.4 million invested around the world on June 30 this year.

 

Out of that £117.4 million fund, the council invested £15 million in 'FADB', the First Abu Dhabi Bank, the largest bank in the United Arab Emirates (UAE); £10 million matures in January and May 2023.

 

Homosexuality is also illegal in the UAE, where, under sharia law, it is punishable by the death penalty.

 

The council also invested £12.5 million in the National Bank of Kuwait. £7.5 million of that matures in April 2023.

 

In Kuwait, the law criminalises consensual sex between men, with a penalty of up to seven years' imprisonment.