The Scottish Parliament invests in oil-rich Qatari state, which has been condemned for human rights abuses by the First Minister, despite a pledge on ethical investments.
The Herald can reveal that the Parliament pension fund currently has holdings in bonds issued by the Qatar Central Bank despite making a commitment in 2021 to make no future pension contributions that derive income from fossil fuels.
The central bank describes the bonds as “one of the major government debt instruments used by the government to provide the necessary liquidity for project funding.”
These bonds issued by the Qatari state were for “general funding purposes” and to repay a $10 billion bond to the United States which was issued during the pandemic to account for the loss of revenue from oil and gas.
The pension Fund Trustees agreed in March 2021 that no further MSP pension investments would be made in carbon-based businesses. Since then companies that derive more than 10% of revenues from fossil fuel extraction and production have been excluded from investment.
Whilst not a business, in Qatar the primary oil and gas company is state-owned. The fossil fuel industry accounts for more than 70 per cent of government revenue and 60 per cent of GDP.
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The Scottish Parliament's pension scheme currently holds shares with a market value of £34,468.02.
A board of trustees comprised of current and former MSPs is responsible for managing and administering the fund in accordance with the scheme rules. The current board of trustees is chaired by Pauline McNeill of the Labour Party with Gordon MacDonald, Murdo Fraser and Mark Ballard sitting on the board.
The pension is managed externally by Baillie Gifford, an Edinburgh-based investment firm, in pooled funds which say they exclude companies that contravene UN principles on human rights, labour, the environment and anti-corruption. Currently, the fund has a value of £97,021,851.17.
The Qatar state came under fire in the run-up to hosting the World Cup for its human rights record. It was widely reported that over 6000 people died constructing the stadiums for the tournament, in a country where gay marriage is still illegal and LGBTQ rights are heavily restricted.
Then Minister for Scotland’s International Development, Humza Yousaf, and now First Minister visited Qatar in 2015 to raise concerns about the rights of migrant workers urging the state to “comply with international and human rights law, and condemn human rights abuses”.
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In 2019 the Scottish Parliament led a review into the ethics of the pension investment scheme after it was revealed by The Ferret that investments were held in arms companies, Putin’s allies and a Taiwanese company blamed for mass suicides in factories that produce Apple products.
MSPs previously demanded that the fund divest its £300,000 worth of shares in the Russian financial institution Sberbank. The Herald can also reveal that the Sberbank shares have since been divested.
In reference to the requests to divest from Russia, a Scottish Parliament spokesperson said that: “It is one of a number of investors in the funds, therefore beyond these ethical conditions, the trustees cannot direct Baillie Gifford in their investment strategy.”
When asked about the holdings in the Qatari state bonds the Scottish Parliament spokesperson reiterated their previous commitment: “In March 2021, the trustees agreed no future pension contributions would be invested in companies that derive more than 10% of their revenue from alcohol, fossil fuels, tobacco, adult entertainment, armaments or gambling.
"That decision of the trustees means no further contributions have since or will be invested in the Qatari state fund.”
Since 2021 the pension fund has been able to divest from the companies described but their holdings in the Qatari state still remain.
The chair of Parliament's Pension Board Pauline McNeill has been contacted for comment.
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