Remove barriers to infrastructure investment, says FSC
The Government must remove a number of structural, regulatory and political issues that must be resolved before the $1.3 trillion in superannuation saving can be utilised to finance Australia's infrastructure needs, according to the Financial Services Council (FSC).
Ernst & Young has produced a report for the FSC which argues that the current 5-10 per cent allocation to infrastructure in superannuation funds can be improved if certain barriers to investment are removed.
These obstacles include a lack of a clear project pipeline and Government commitment; a lack of suitably structured projects for institutional investment; inconsistent, complex and expensive bidding processes; and regulatory pressures.
"The Government took the first steps in removing the barriers to ongoing investment in infrastructure in the Federal Budget this year," said FSC chief executive Jon Brogden.
The FSC/Ernst & Young report said further investment could be stimulated by using the existing Infrastructure Australia priority project list to create a pipeline of Government-sponsored projects. Recycling Government capital in infrastructure assets more efficiently and simplifying the bidding process would also help, according to the report.
"However, let's be clear - superannuation is not a cash cow to fund particular economic ills in Australia. A fund's first duty is to its members and ensuring investment returns are maximised," Brogden said.
Recommended for you
With Insignia Financial suffering a cyber attack on its Expand platform, this can potentially have a negative impact on the two private equity bids currently in play for the firm.
State Street Global Advisors has made an equity investment in Ethic, a platform helping financial advisers to produce bespoke portfolios, reflecting the greater client demand for customised portfolios.
WT Financial’s new entity with Merchant, Investco, has entered into a heads of agreement to merge three financial advice firms.
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
