Reporting of the AP funds' operations up to and including 2022
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
The debate concerned the activities of the AP funds and their sustainability work. V argues that the funds' holdings in fossil gas projects in Mozambique and in Chevron cannot be judged as sustainable as they cause environmental destruction and violate human rights 1 2. V believes that the Riksdag should influence the funds' frameworks because current investments prioritize economic return over sustainability 1 3. M argues that the funds' mandate is high return, long-term perspective, and security for the employees 4. M emphasizes that politics should not govern specific investments but that the funds themselves should make these trade-offs based on their specific goals and focus areas 4 5 6.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Ilona Szatmári Waldau (V)
Mr. Speaker! Vänsterpartiet has in this matter a specific statement where we present the proposals that we have previously motioned for so that the AP funds' holdings shall be truly sustainable. We do not share the government's assessment that the funds have responsible investments and that the Sixth AP fund and the Seventh AP fund have met the expectations on sustainability work.
Let me give some examples of the holdings that the funds have or have had in the recent past.
The AP funds, for example, have holdings in three fossil gas projects in Cabo Delgado in northern Mozambique. These gas deposits were discovered about 20 years ago. It is one of the largest fossil gas finds discovered in the world, and planning immediately began for a large offshore gas platform. On the mainland near the city of Palma, a facility is also being built to convert the gas into liquid form and a port to be able to export the gas. The fossil gas finds have clearly attracted many foreign companies.
Both the First-Fourth AP fund and the Seventh AP fund have holdings in companies that are part of the gas project. The Third AP fund, Fourth AP fund, and Seventh AP fund invest in both the companies leading the fossil gas project in Cabo Delgado and in their financiers and end customers, while the First AP fund's and Second AP fund's portfolios are limited to the financiers and end customers. In total, the AP funds' holdings in companies with connections to the fossil gas project in Cabo Delgado amount to over 25 billion Swedish kronor.
The gas industry in Cabo Delgado has been catastrophic for the country and for its population. Over 500 families, fishermen and farmers, have been forced away from their homes and have lost their livelihoods even before the extraction itself started. An additional around 2,000 families may be affected in the future. In the wake of the exploitation, severe armed conflicts have flared up and worsened. Over 700,000 people are fleeing in the area, and many have been killed.
If the gas is extracted, it will cause irreversible damage to unique and sensitive nature, such as coral reefs and mangrove swamps, and result in large emissions of greenhouse gases that drive global warming. Mozambique is already one of the countries hit hardest by climate change.
The AP funds' holdings in these companies cannot be assessed as sustainable when it comes to either human rights or the environment.
Another example is Texaco, a company now owned by Chevron. Texaco has conducted operations in Ecuador. There, land and waterways are affected by oil spills, and the indigenous people living there have suffered several hardships because they can no longer bathe in the river, drink the water, or cultivate the land. Several have also been affected by diseases. Water and soil samples show high levels of heavy metals, and this can be linked to thousands of cases of cancer, miscarriages, and birth defects. According to the organization Amazon Watch, those living here have lost 95 percent of their ancestors' lands as a result of the pollution. Texaco's, that is Chevron's, oil spills in Ecuador are often called the Chernobyl of the Amazon. Chevron has left Ecuador without remedying the environmental catastrophe it caused, despite several judgments in Ecuadorian court.
Most AP funds no longer have investments in Chevron, but the Seventh AP fund still does. The AP funds usually defend their holdings by stating that through the holding, they can influence companies in a positive direction. I have previously asked – without receiving an answer – how one, through their holding, influences for example the Saudi dictatorship's state oil company Saudi Aramco, which is the world's largest fossil fuel company and the company that has emitted the most carbon dioxide in history. I now wonder how, through their holding in Chevron, one influences Chevron to take responsibility for Amazon's Chernobyl and remediate it.
The problem with the remediation is that it would go against the AP funds' mandate that financial return takes precedence over sustainability. The AP funds' profit becomes more important in this context than that the indigenous people in Ecuador should be able to live on their land and more important than that the area is cleared of oil and heavy metals.
The gas project in Mozambique, the Saudi oil company Saudi Aramco and Chevron are the investments I have mentioned now. In previous debates, I have raised other investments that cannot be considered sustainable.
Mr. Speaker! I have no other motion than the committee's in this matter, but the question of the AP funds' sustainability is too important for the matter to simply be referred to the clerks. I would therefore like to conclude by urging the AP funds to review their holdings, listen to the populations in the countries affected by environmental disasters, and seriously do what they say they do: Set demands on the companies, take the fight with the Saudi state, with Chevron, with the companies behind the gas projects, and with all other companies engaged in questionable activities, not least with the dictatorships where the funds hold government bonds!
Our pension funds should be invested in sustainable development and not in environmental disasters and dictatorships.
Ida Drougge (M)
Mr. Speaker! I would like to begin by moving for approval of the committee's proposal for a decision to submit the communication regarding the AP funds' activities during 2022 - which we are now discussing - to the records.
It is important in this context to remind oneself that the mandate of the AP funds is to manage fund assets for all of Sweden's wage earners and to contribute the greatest possible benefit to the pension system - the income pension system and the premium pension system. This management shall be based on high returns, long-term perspective, and security in order to safeguard our wage earners' pensions.
There are few other political reforms or systems that are as important for social sustainability in Sweden as that we have a public commitment regarding pensions that works. Many other countries that do not have this type of system but nevertheless spend and allocate tax money on pensions need to set aside up to a quarter of all the money they collect from taxpayers for pensions.
Here we instead have a fund system that can step in and cover and contribute with that. We can therefore allocate our tax money to many other things as well. That is very valuable. Since the forty-year-olds started retiring, the revenues from pension contributions have namely decreased sharply, while the expenditures have increased. Therefore, it is absolutely crucial that we have these buffer funds.
The overarching goal must continue to be high return at low risk in order to secure high pensions for our retirees today, tomorrow, and for a long time to come.
The funds should not have economic policy goals, we believe, but should take into account environment and ethics in their investment activities. It should be the funds themselves that set more specific goals, as they do today. These goals can and shall vary because the funds have chosen different focus areas and directions. That the activities may look different and are independent of one another is also a way to minimize the risk for all of us. Otherwise, we could all be in one and the same fund.
During 2022, the result from our buffer funds amounted to -160 billion kronor after costs. One has nevertheless been able to contribute approximately 19 billion to the pension system, because one has made a profit during the majority of the years we have had this system. During last year's fiscal year, i.e. 2021, record profits were made - 20 percent, just to take an example.
With this, I would like to thank the AP funds for their activities.
Ilona Szatmári Waldau (V)
Mr. Speaker! I would like to take this opportunity now that Ida Drougge chose to make a post. I noticed that the member has looked a bit at our motion and that she answered things that I did not mention.
I want to start by urging everyone listening and also member Ida Drougge to google Chevron and Ecuador and look at the images that appear. It is oil spills that just lie there and which make it so that the inhabitants in the region cannot live there.
A couple of weeks ago, I met two representatives from an organization that I believe has 30,000 members and which works to have the area in Ecuador remediated. They asked how they should be able to explain to their children that they are not allowed to swim in the river because it is life-threatening. They naturally talked about many other things as well, and it was this that made me decide to speak up in this debate and tell what kind of companies Swedish AP-funds have holdings in.
It is said that the most important thing is to safeguard Swedish pensions. I agree that it is important to safeguard our pensions and to have as high a return as possible, but this must happen without people in other countries being affected by environmental destruction, being driven from their homes, and so on. My question to the member is therefore: Is it really right that Swedish pension money should go towards environmental destruction and towards displacing people from their homes?
Ida Drougge (M)
Mr. Speaker! I thank you for the question. It is correct that it is not politics that should make decisions on placements. It is correct that it is our independent funds that should make those types of assessments and trade-offs. It is also correct that the funds should be scrutinized and questioned and that the funds develop their result reporting.
It is difficult today to get a unified picture of the results within the sustainability area, for example, and therefore the funds need to develop that type of reporting. They also certainly need to change their investments and make many changes, but I do not believe it is we in politics who, through changed investment targets, should make that type of assessment.
This is important, because even if politics can be slow sometimes and one might think it takes far too long, public opinion is sometimes erratic, even though I in no way mean that is the case in the instance that Ilona raises. We can take nuclear power as an example, or biogas or other types of technology that can increase our sustainability. There, public opinion can be erratic, and therefore it should not be politics but the funds themselves that base the decisions on them.
Ilona Szatmári Waldau (V)
Mr. Speaker! Thank you, Ida Drougge, for the answer! I react a little bit to that part about the Riksdag not being to decide on investments. It is true that it is the funds themselves that decide on the investments, but the Riksdag has made decisions on certain guidelines, for example that the investments shall be environmentally sustainable, or sustainable, but that it must not come at the expense of profitability.
We see how the funds interpret this somewhat differently. Some funds have divested their entire holdings in fossil industries, except when one supports financiers. They have divested those that extract. Other funds retain their holdings because they believe they can step in and exert influence.
Now I have two follow-up questions. One is what I have asked questions about: In what way do our Swedish AP funds affect the Saudi company Chevron and the dictators that they finance with government bonds? In what way do our AP funds affect it so that it becomes better? It is very difficult to get answers to this from the AP funds, but the member may have an answer.
Since it is the Riksdag that sets the goals and frameworks for our funds, the Riksdag has the opportunity to influence what types of investments one can and is allowed to make. My second question to the member is therefore: Is the member prepared to discuss the forms and frameworks for the AP funds?
Ida Drougge (M)
Mr. Speaker! I do not have access to any other sources than those the member himself has.
The reason I wanted to point out that it should not be the Riksdag that directs the funds' investments is that the member asked questions about specific investments. It was for this reason that I gave my answer.
That the funds can make and do different interpretations needs to be seen in light of the fact that the funds have different focus areas and have different more detailed goals for how they should reach these goals, and they can be reached in different ways. Depending on what competence one has in one's management and what measuring instruments one uses and has access to, one can also influence the different actors one invests in to different extents. And then the funds must be allowed to make different choices.
I do not think it is particularly strange or even incorrect in itself, but it is natural and also a reason why we have different funds and not one. Had we had fewer funds, we could have had a lower management cost, which would have been efficient. But now we have chosen not to have that, and this is partly so that one can have different focus areas, act in different ways, spread risks, and have independence.
I hope that this was, at least in some measure, an answer to the question.
The deliberation was hereby concluded.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.