WEALTH FUND’S NEW GOALS; NT TOPS TABLE
Chalmers shifts investment mandate for sovereign wealth fund
Treasurer Jim Chalmers and Finance Minister Katy Gallagher have announced a major shake-up of Australia’s sovereign wealth fund, with a new investment mandate to focus on government-directed national priorities. Under the changes, the $230 billion Future Fund would consider investment in the supply of residential housing, the net zero transformation, and the delivery of infrastructure in Australia. The Federal Government said the fund’s benchmark return rate would remain at four to five per cent above CPI per annum “over the long term”, with no change to the expected risk profile. Dr Chalmers said the Future Fund was expected to grow to $380 billion by 2032-33, with no drawdowns on the fund until at least that year. The Future Fund was established in 2006, with an initial $60 billion, to make provision for Federal Government unfunded superannuation liabilities.
Departing US Ambassador lauds AUKUS progress
Outgoing US Ambassador to Australia, Caroline Kennedy, says the deterrent effect of the AUKUS defence partnership has delivered “remarkable” progress in just two years. In a speech to the National Press Club in Canberra, the Ambassador said that under the tri-lateral partnership, the US was sharing its nuclear technology for only the second time, and all of the US, UK and Australia had modified their export control regimes to increase license-free trade. Ms Kennedy said AUKUS was an existential investment in Australia’s sovereignty and way of life. In response to critics of AUKUS, the Ambassador cited the ramming and sinking of ships in the Philippines and Vietnam by Chinese “coast guards”, the landing of missiles near the shores of Japan, and industrial-scale fishing activity around the Pacific nations. Ms Kennedy said Pillar Two of AUKUS also provided technology and artificial intelligence opportunities for Australian innovators and entrepreneurs.
Territories top the table for economic growth
All Australian states and territories grew their economies in 2023-24, with the Northern Territory (NT) and Australian Capital Territory (ACT) being the standout performers. The NT recorded 4.6 per cent growth in Gross State Product (GSP), thanks to an increase in oil and gas extraction, while the ACT’s four per cent annual growth was attributed to an expansion of government agencies. Of the states, Queensland recorded the highest lift in GSP (2.1 per cent), with the lowest in Western Australia (0.5 per cent), which experienced a fall in mining activity and a reduced grain harvest. On a population basis, however, the Australian Bureau of Statistics found that only Tasmania, the NT and ACT grew their economies – all the other states went backwards on a GSP per capita measure.
Australian economy heads for soft landing, says Treasurer
Meanwhile, Treasurer Jim Chalmers says Australia’s economy is on track for a "soft landing", with a modest recovery in consumer confidence offsetting slow economic growth. Dr Chalmers told Federal Parliament that while other countries had “gone backwards”, Treasury was expecting a gradual recovery in the domestic economy. He said that inflation was coming back to its 2-3 per cent band while unemployment was still less than five per cent. Youth unemployment, he said, had averaged nine per cent since May 2022, which was two-thirds of the pre-pandemic average.
Cybercrime hotline reports up 12 per cent
More than 87,000 reports of cyber crime were received by the Australian Signals Directorate (ASD) in 2023-24 – an average of a report every six minutes. The ASD’s annual cyber threat report revealed that the Australian cyber security hotline received more than 36,700 calls, a 12 per cent rise on the previous year. Commenting on the report, Defence Minister Richard Marles and Home Affairs Minister Tony Burke said malicious state and non-state cyber actors were targeting Australian governments, critical infrastructure, businesses and individuals. They said 11 per cent of the 1,100 cyber security incidents to which the ASD had responded related to critical infrastructure. According to the ASD report, the average cost of cybercrime for small businesses rose by eight per cent to almost $50,000 in the past year.
Military training offer for ASEAN members
Australia will strengthen its defence ties with Southeast Asian nations, offering new military training opportunities through a new engagement program. After meeting with ASEAN Defence Ministers in Laos, Defence Industry Minister Pat Conroy said military officers and defence officials from member states would pursue education and training opportunities in Australia. In addition, Mr Conroy said ASEAN-Australian defence postgraduate and maritime security research programs would be extended to scholars from Timor-Leste. ASEAN comprises 10 member states, with Australia being a dialogue partner.