20 February 2014
Long-term investors natural holders of privatised government assets: ASFA
The Association of Superannuation Funds of Australia (ASFA) notes recent comments from the Federal Treasurer Joe Hockey in regards to removing taxation impediments that act as a disincentive for state governments to privatise assets.
ASFA is supportive of governments privatising assets. Superannuation and pension funds are the natural holders of mature assets including ports and energy assets.
ASFA understands that privatisation can lead to community concern about how assets will be managed in the future.
ASFA CEO Ms Pauline Vamos says “Australian superannuation funds have a long track record of investing in infrastructure. As long-term investors, superannuation funds are interested in achieving long-term sustainable investment returns. Our interests align with those of the community and governments that are interested in ensuring that assets are managed responsibly for the long-term benefit of society.
“ASFA supports the ‘recycling of capital model’ whereby governments use proceeds from asset sales to develop those infrastructure assets where infrastructure investors are unwilling to take on risk. The NSW Ports deal demonstrated that super funds are very interested in stable, mature assets. For sales to be electorally sustainable there needs to be a demonstration that recycled capital is invested into new projects.
“There is no shortage of superannuation and pension funds that are looking to invest in infrastructure. There is only a shortage of projects to invest in. The key to unlocking pension capital is the maintenance of a stable regulatory environment, removing any impediments to states privatising assets and minimising transaction costs for funds. Australia’s strong rule of law and stable regulatory environment make Australia an attractive destination for long-term investors globally.
“ASFA believes that Australia’s presidency of the G20 represents an opportunity to promote Australia’s infrastructure investment expertise. Pension funds globally are developing their appetite to invest in infrastructure, with Australian infrastructure investment managers leading the way in terms of bringing projects to market,” Ms Vamos concluded.
For further information, please contact:
Katrina Horrobin, 0451 949 300.
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral, and non-party political national organisation, which aims to advance effective retirement outcomes for members of funds through research, advocacy and the development of policy and industry best practice.