Senator the Hon Katy Gallagher

The Albanese Government will modernise the nation’s sovereign wealth fund, building on its success to ensure it can play an enduring and prominent role in our economy. 

We are refreshing and renewing this core economic institution to make it stronger, more successful and more sustainable into the future. 

Today the Government is: 

• Elevating its status as an enduring national asset and making the Fund an ongoing feature of Australia’s economy.
• Issuing a new Investment Mandate to Maximise the Fund’s role in a changing economy.
• Releasing the first Statement of Expectations for the Future Fund in 15 years.

The independent Future Fund already plays a crucial role in our economy and the Government wants to make sure it can play an important role in the decades ahead. 

The Australian economy faces major structural shifts including from the global net zero transformation, technological and demographic change, and global fragmentation. 

The Future Fund has made clear it can play a prominent role in capitalising on these economic opportunities and supporting Australia’s prosperity. 

The Fund’s primary focus will remain on maximising its returns, and at the same time, our changes will help it maximise its role in delivering for Australians in the future.

The new Investment Mandate will require the fund to consider Australia’s national priorities in its investment decisions, where possible, appropriate and consistent with strong returns. These national priorities are:

• Increasing the supply of residential housing in Australia.
• Supporting the energy transition as part of the net zero transformation of the Australian economy.
• Delivering improved infrastructure located in Australia including economic resilience and security infrastructure.

This will mean more investment where we need it most but not at the expense of returns. 

The new Statement of Expectations will provide guidance on operationalising the Investment Mandate and will ensure the Fund has best practice approaches when it comes to governance, transparency and accountability.

The Government is also confirming the Fund’s enduring role in strengthening the Commonwealth’s long-term financial position and covering unfunded superannuation liabilities. 

To support this, the Government won’t start any drawdowns from the Fund until at least 2032-33, providing the Fund the certainty it needs to continue to build its portfolio. 

By 2032-33, the $230 billion Future Fund is expected to grow to $380 billion. 

The Government remains committed to the Fund’s independence and commercial focus. 

Its primary objective will continue to be to maximise returns, the benchmark return rate will remain at between four and five per cent above CPI per annum over the long term, and there will be no change to the expected risk profile. 

The Fund will provide the same strong returns to the government’s balance sheet while supporting national priorities where it can, and complementing the significant investments made by our specialist investment vehicles including the Clean Energy Finance Corporation, the National Reconstruction Fund, and Housing Australia. 

We thank the independent Future Fund Board of Guardians for its agreement and support for the Government’s changes and its constructive engagement over the course of the year. 

We briefed the Board of Guardians in August and we've regularly consulted the Chair and members in an ongoing way throughout this process.

These changes will strengthen the Future Fund and the Australian economy more broadly as a consequence.