Nick Sherry (Tasmania, Australian Labor Party, Shadow Minister for Banking and Financial Services) Share this | Hansard source

On that basis the National Party could grab it every three years—you are right, Senator Murray. I am sure the National Party will be putting up their hands to grab that actuarial identified surplus for any manner of purposes.

I also want to address this issue in the broader policy context of the impact of the ageing population on the budget. It seems to me that the government is trying to walk both sides of the street in this debate. On the one hand, you have the Treasurer, Mr Costello, talking about the ageing population, the Intergenerational report and the need to ensure sustainable finances in respect of a range of policy long-term cost pressures as a consequence of the ageing population. On the other hand, the government has initiated a number of policies—and time does not allow me to go into any great detail today—which, because of the ageing population, will actually significantly increase liabilities in a number of expenditure areas, particularly in areas like health. So, on the one hand, it claims fiscal rectitude, long-term planning, responsibility and care about the ageing population and cost; and, on the other hand, in a number of policy areas on the expenditure side it has been increasing those costs—costs that will increase exponentially.

The Future Fund as outlined in this particular bill is not what was announced. There are a number of issues that go to allowing direct ministerial intervention—ministerial powers of direction that are allowed in respect of the Future Fund and that may expose the fund to political interference and undercut the investment performance of the fund. We do not believe that it is appropriate that ministers should be able to issue powers of direction. In this case the trustees are called guardians. In effect, there is no difference between a guardian and a trustee. Apparently, the term ‘guardian’ is the personal terminology creation of the Treasurer. We know that much from Senator Minchin’s comments in estimates. We do not believe it appropriate that ministers, in this case the Treasurer and the Minister for Finance and Administration, should have powers of direction over the guardians or trustees. If the sole purpose is to maximise a rate of return commensurate with safety and to build up a fund to cover public sector super liabilities, ministers of the day should not have the power to direct and influence investment.

If it were a Labor government proposing something like this, we would be accused of socialising the entire Australian economy—having Labor ministers in there with powers to direct and own every conceivable part of the Australian economy. Just imagine the hysteria of the Liberal Party criticising a Labor government with such powers. I move:

At the end of the motion, add “but the Senate is of the view that:

  (a)   the Future Fund should only invest on a prudent commercial basis and manage funds in a manner consistent with:

              (i)    best practice portfolio management,

             (ii)    achieving desired returns without undue risk to the fund as a whole,

            (iii)    enhancing Australia’s reputation as a responsible and ethical investor, and

            (iv)    building productive capacity in the Australian community; and

  (b)   the income stream from the fund should be used for productive national economic purpose rather than being set aside solely to offset the cost of public sector superannuation as the Government intends”.

(Time expired)