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Fossil fuel divestment proposal attacked as 'Greens agenda'

Moving its investments out of financial institutions investing in fossil fuels, like coal mining, could improve the council's return on its investments.
Moving its investments out of financial institutions investing in fossil fuels, like coal mining, could improve the council's return on its investments. Robert Rough

A PROPOSAL for Clarence Valley Council to divest itself of fossil fuel interests in its term deposits has been attacked as part of a "Greens agenda".

Cr Arthur Lysaught described the proposal, outlined in a notice of motion from Greens Cr Greg Clancy, as "pure politics, straight out of the Greens handbook".

But Cr Lysaught's views were not shared by other councillors, who were more than happy to explore the opportunities alternative investments offered.

During questions the council's director corporate, Ashley Lindsay, told the councillors moving away from the big four banks, which was a key recommendation of the notice of motion, could result in higher returns.

"There's nothing wrong with it (divesting) if you're prepared for a higher risk," he said.

"There is an increased risk in investing in a lower rated institution, but there is a higher return on your investment for that risk. The greater the risk, the greater the return."

Mr Lindsay also noted, in reply to a question from the Mayor Jim Simmons, that divesting from the major banks could affect the council's capacity to borrow in the future.

"We've got the major part of our debt with the National Australia Bank and they like to have invested funds to offset borrowings.

"Potentially withdrawing from NAB could hurt us if we're going to the market for loans. It might be restrictive.

"But given the council's attitude on debt we're not likely to be be looking to borrow in the short term."

Cr Andrew Baker said divestment could help the council respond to the TCorp report on the council's finances that said council needed to look at different ways of increasing its revenue.

"But it would be prudent for council to analyse this further so we don't compromise our borrowing ability," he said.

Deputy mayor Jason Kingsley moved to amend the notice of motion to defer it to the November council meeting to give staff a chance to explort the impace of divesting from fossil fuel aligned financial institutions.

The councillors voted 7-1 for the amended motion, with Cr Lysaught the lone dissenter.

Topics:  fossil fuels greens greg clancy



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