Future Fund buys more tobacco shares

The Government's multi-billion dollar Future Fund has revealed it increased its shareholding in tobacco companies in the lead-up to last year's announcement that it was reviewing its investment strategy.

Figures provided to a Senate committee show the fund had $231.7 million tied up in tobacco company shares as at October 16 last year, up more than $6 million from February.

It also shows the fund has expanded the number of tobacco companies it has invested in during that time, through the purchase of Philip Morris (Czech) shares.

In 2001, Philip Morris was forced to apologise for a study commissioned by its international affiliate that found the Czech Republic benefited financially from the premature deaths of smokers.

In late October, the Future Fund's managing director Mark Burgess raised the prospect of the fund dumping its tobacco shareholdings following pressure from health groups and the Greens.

Mr Burgess said the board's governance committee would consider the fund's investment in cigarette and tobacco companies, including the cost implications of such a decision.

Greens Senator Richard Di Natale says he is extremely disappointed that the fund was buying more shares just months before that announcement.

"[These companies] are taking legal action against the Government, companies that are essentially in the business of killing people," Senator Di Natale told ABC News Online.

"Australians are horrified when they learn that their taxpayer dollars are being invested in companies like Philip Morris [and] British American Tobacco." The fund has not provided tobacco shareholding details past October last year, so it is unclear what changes have occurred since.

According to those figures, the fund was holding $57 million worth of British American Tobacco shares, $48 million in Lorilland shares, almost $46 million in Philip Morris International, and $34.6 million worth of Japan Tobacco shares.

The Future Fund's management is due to appear before a Senate committee later today.

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