What is the Future Fund for?

News analysis

Charlie Corbett

Thu 05 Apr 2007

Some sort of clarity needs to be brought to the debate over what exactly the Future Fund is for. Is it in place to fund the future liabilities of public sector workers or is it merely a handy pot of money for governments to dip into every now and again to win votes?

Labor's treasury spokesman Wayne Swan has gone on the record as saying that if elected the Labor government would happily dip into the fund in order to bolster Australia's antiquated communications infrastructure.

In a speech to the right-wing think tank The Sydney Institute on Tuesday, Swan sallied forth on the need for a high-speed broadband connection in order for Australia to compete with the rest of the world.

Under a Labor government, he said, this and other infrastructure projects would be funded by the Future Fund.

"Now that we know that the Future Fund will be able to comfortably meet public sector superannuation liabilities without the need for additional payments from the surplus after next year, it makes perfect economic sense to invest a small proportion of its funds in excess of those needed to meet the public sector liabilities to boost future productivity and wealth," he said.

For Labor then, the Future Fund is more than just about meeting public sector liabilities.

Not so in Treasurer Peter Costello's camp. The coalition government is adamant the Future Fund be left well alone and used only for its original purpose - funding the potential liabilities of public sector workers.

"Mr Swan promised the Future Fund would be a 'locked box'," Parliamentary Secretary to the Treasurer Chris Pearce said in response to Swan's remarks on Wednesday. 

"Now he is raiding the Future Fund before the ALP is even elected. Everyone knows the first raid on one's savings is always the hardest, but then it becomes easier on each occasion after that. After time, there are no savings left. The ALP are committing the worst fiscal crime of all - that of theft from future generations."

It seems a shame that such a fiscally sound idea is being used as a political football already.