Fianna Fáil Finance spokesman Michael McGrath made the charge after figures show that the State has €50m invested in so-called sin stocks, made up of shares in firms in the tobacco, defence, and alcohol industries.
In a written Dáil response to Mr McGrath, Finance Minister Michael Noonan confirmed that the State, through its Ireland Strategic Investment Fund, has €9.6m of investment in firms in the tobacco industry; €27.1m in firms in the alcohol industry; and €14.1m in companies in the aerospace and defence sub-industry.
The revelations come as the Oireachtas this week passed legislation to introduce plain packaging of cigarettes. The bill must now be signed by President Michael D Higgins to bring the rules into law. It has put the Government on a collision course with firms in the industry.
A recent study by Credit Suisse, on the best equity market performers over the very long term, shows that nothing beats tobacco and alcohol stocks.
However, Mr McGrath has described as “utterly hypocritical” the fact that the State holds over €9.6m in investments in tobacco stocks given the recent legislation.
Mr McGrath said: “These figures highlight the extraordinary double standards of the Government on the issue of tobacco in particular, but also on alcohol and armaments.
“On the one hand, [Children’s] Minister James Reilly has declared war on the tobacco industry and described it as evil, while on the other hand the Government is giving the tobacco industry a boost by actively investing in it. The Government’s approach to tobacco is completely hypocritical.”
Mr McGrath added:
“There is a strong case for the National Pension Reserve Fund to review its ethical investment strategy and completely screen out stocks in harmful industries such as tobacco and armaments until such time as the fund completes its transition to investment in the domestic economy.
“This type of ethical strategy has been successfully implemented in countries such as Norway and would ensure the State is not seen as complicit in their activities.”
Separate figures provided by Mr Noonan show that the State’s income from tax revenues on tobacco and alcohol dwarf any earnings the State may receive in dividends from their shares in those firms.
He confirmed that the estimated tax revenues in 2014 from tobacco sales were €1.29bn, with the tax revenues from alcohol totalling €2.19bn.
Legal firm Arthur Cox represents a tobacco firm threatening to halt the plans to introduce plain packaging. Figures show it also carried out lucrative work for the Department of Finance and Garda Síochána Ombudsman Commission (GSOC) last year.
Arthur Cox represents Japan Tobacco Ireland, a firm which threatened High Court action over the plans.
Arthur Cox advises both the HSE and the Child and Family Agency, Tusla, and new figures show that the legal firm last year received €824,247 in fees from the Department of Finance.
The company also received €331,379 in legal fees from GSOC last year and an additional €79,198 from Revenue.