Lincolnshire pension fund has £1.8m locked in Russian stocks and debts

Members of a Lincolnshire pension pot have around £1.8 million tied up in Russian stocks and debts that they can’t get rid of according to county council bosses.

The Lincolnshire Pension Fund, which includes nearly 300 councils, schools and drainage boards and employers such as Lincolnshire’s Police and Crime Commissioner, has an investment portfolio of around £3 billion.

This means the Russian investments represent 0.06% of the fund’s portfolio.

Jo Ray, head of pensions at Lincolnshire County Council, said: “Because of the closure of the Russian stock exchange and suspension in trading, it is not possible to withdraw these investments at this time.

“However, the pension fund and its investment managers are closely monitoring the situation.”

The council confirmed it had no direct investments in Russia.

The authority’s Pension Committee, which includes councillors and representatives of employees, district councils and other bodies, will receive a series of reports on their investments and strategies next Thursday.

One report, from independent advisor Peter Jones, will explore the Russian invasion of Ukraine, including the spike in inflation and other anxieties for the markets.

“Regional conflicts rarely have any lasting effects on the level of stock markets or interest rates – but this one clearly does,” said Mr Jones,

“It not only involves Russia, the USA and most of Europe, but also China on the fringes.”

He noted a “crisis” over energy and a desire by Russia and China to “test US resolve” following its withdrawal from Afghanistan.

He also warned of “too high” inflation rates and “falling” living standards, adding: “The worsening situation in Ukraine probably makes drastic Central Bank action less likely, and maybe subject to delay, for fear of exacerbating pressure on economies from falling living standards.”

He said companies “remain optimistic about their prospects” in terms of share prices, but warned it “could change quickly”.

“The combination of serious military conflict in Ukraine with sharply higher energy prices injects a greater than usual amount of uncertainty into market prospects,” he said.

“Could markets fall say 20% from current levels? Yes, in a worst case. Will they – perhaps only President Putin knows the answer?”

The Pensions fund has previously come under criticism for some of its other investments, including fossil fuel companies and tobacco companies.

For a full list of Lincolnshire Pension Fund members, visit here.