Future Fund Investment Mandate
The Government provides the Future Fund Board of Guardians (the Board) with strategic investment guidance through the Future Fund Investment Mandate Directions 2006 (the Investment Mandate). The Investment Mandate is updated only in response to special circumstances, such as where new policy considerations make a change imperative or where there has been a significant change in the investment environment.
The Board is a body corporate with a separate legal identity from the Australian Government. The Board is responsible for the investments of the Future Fund and Nation-building Funds and is accountable to the Government for the safekeeping and performance of the Funds' assets. The Nation-building Funds have separate Investment Mandates.
The Future Fund Investment Mandate is tabled in both Houses of Parliament but cannot be disallowed by either House.
To date, only one Investment Mandate has been formally issued to the Board.
Among other things, the current Investment Mandate stipulates that the Board is to adopt a benchmark average return for the Future Fund of “at least the Consumer Price Index (CPI) + 4.5 to + 5.5 per cent per annum over the long term”. In striving for this benchmark return, the Board may pursue an acceptable, but not excessive, level of risk.
Last updated: 21 October 2013