Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

My question is to the Treasurer. Can the Treasurer confirm evidence in Senate estimates by Future Fund CEO Paul Costello today that the Future Fund made no independent inquiries regarding the involvement of Northern Trust in the collapse of the Enron employees’ superannuation scheme before appointing it as its global custodian? Can he confirm that Enron employees lost their superannuation because it was invested in Enron companies and that Northern Trust ultimately paid $US37.5 million to Enron employees to settle litigation against it alleging imprudent management of the superannuation fund? What regulations has the government put in place to ensure that all companies retained by the Future Fund to handle the fund’s investment transactions will do so prudently?

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

No, I cannot confirm any of those matters because the Future Fund is an independent statutory corporation which makes these decisions itself and is not subject to government direction. The government was neither consulted nor could it intervene in relation to any of those matters. And can I, on the way through, make this point: the Labor Party will either respect the independence of the Future Fund or it will not and, if the Labor Party wants to reserve unto itself the right to interfere with the Future Fund, we will let the people of Australia know about it. We will let the people of Australia know that the Labor Party has designs on something which was set up for the future of this country and not for the cheap political opportunism of this Australian Labor Party. I have every reason to believe that the Future Fund acted with propriety, and if the Labor Party thinks that it has not then the Labor Party should come out and say that the contract should be annulled.

As I understand it, the other bidder—and I am only going on what I have read in the paper—was the National Australia Bank. One could say that the National Australia Bank has been the subject of its own inquiries, has it not? Were there not currency traders at the National Australia Bank who have been the subject of charges?

Bob McMullan (Fraser, Australian Labor Party, Shadow Minister for Federal/State Relations) Share this | Link to this | Hansard source

Are you saying that that is analogous?

Peter Costello (Higgins, Liberal Party, Treasurer) Share this | Link to this | Hansard source

Saying it is analogous? What, that somebody has been convicted of a crime whilst working for the National Australia Bank? No, I would not say that that was analogous at all, but I will say this for the National Australia Bank: it dealt with those matters, as it should have. I have seen in relation to the National Australia Bank that it has been the subject of various inquiries and, after those inquiries, it has fixed itself up. Does it have an unblemished record? No, the National Australia Bank does not have an unblemished record. It would be very, very dangerous to say that no financial institution which has ever been the subject of litigation could be trusted in relation to the financial affairs of individuals or companies or government, because I do not think you would find a financial institution anywhere in the world that has not been the subject of litigation—certainly the National Australia Bank would not be in that category. As far as the government is concerned, the Future Fund conducted an open and honest tender. It has made its decision accordingly. The government does not believe that it should intervene, and if the Labor Party does, let it come to the dispatch box and say so.