Job for boys ‘a risk for Future Fund’, says David Murray

David Murray has criticised the appointment of former Labor minister Greg Combet to oversee the Future Fund board, describing him as a ‘political appointment’ who could undermine its independence.

Former union boss and Labor minister Greg Combet. Picture: NCA NewsWire / Ian Currie

The inaugural chairman of the Future Fund has criticised the appointment of former union boss and Labor minister Greg Combet to oversee the board of the $212bn sovereign wealth fund, describing him as a “political appointment” who could undermine its independence.

David Murray, the former Commonwealth Bank chief executive who chaired the Future Fund board from 2006 to 2012, said he was concerned Mr Combet could threaten to undermine the fund’s historically strong investment performance by encouraging it to put its money into “so-called nation-building stuff”.

“Ever since I did the financial system inquiry, Greg Combet has been a cheerleader for this so-called nation-building stuff. I think the risks here are substantial,” he said.

“I would counsel the Future Fund against doing anything like that because it will create more risk and prejudice its returns.”

Mr Combet has publicly backed superannuation funds investing more in the energy transition and social housing, as long as the investments produced solid returns.

Jim Chalmers unveiled the former ACTU secretary and climate change minister as the next chair of the fund, replacing former Liberal treasurer Peter Costello, who has served two-five-year terms in the $250,000 role.

The Treasurer – who has called for superannuation funds to invest in government priorities such as green energy, housing and infrastructure – said Mr Combet would help “renew and refresh” the Future Fund and shape the “future role” of the ­vehicle set up to help pay for the commonwealth’s public sector superannuation liabilities.

When asked whether he would review the investment mandate of the Future Fund so it invested more in the energy transition, Dr Chalmers said he cherished the body’s independence.

“And we cherish its commercial focus, and we don’t want to mess with that,” he said. “What we want to do here is to make sure that the Future Fund is an important economic and financial institution into the future.”

Mr Combet will step down from his role as chair of the Net Zero Economy Agency ahead of joining the Future Fund this year.

As NZEA chair, Mr Combet said Australia needed to “unlock” the nation’s $3.5 trillion retirement pool as a way to help drive the energy transition, provided it received a return “commensurate” to the risk.

In his former role as chair of Industry Super Australia, Mr Combet in late 2022 told The Guardian that “when you’ve got a savings system that’s been built up over a pretty short period of time of that scale, it’s not surprising a government would start to think, ‘Gee, we’ve got some important national priorities here’.

“One of them is a deficit in social and affordable housing but there’s also the investment needs to achieve the energy transition, too, and the decarbonisation of the economy,” he said.

Opposition Treasury spokesman Angus Taylor said it was “crucial” the fund’s investment mandate not be altered to invest in “Labor’s ideological pursuits”.

“The Future Fund’s investment mandate has been very clear – to invest for the long-term bene­fit of the country. It must not become a slush fund for the Labor’s ideological pursuits or the Treasurer’s thought bubbles,” he said.

Mr Costello warned in a speech in November that politicians must keep their “sticky fingers” away from the fund, urging his successor to argue against proposals to change its investment mandates.

In comments made on the eve of the release of a new report by The Centre for Independent Studies, entitled A Better Future With a Future Fund, Mr Murray acknowledged that Mr Costello had also been a political appointee, but he said the former Liberal treasurer had been involved in the ­foundation of the Fund and had rigorously guarded its inde­pendence from the start.

The government also appointed lawyer and company director Nicola Wakefield Evans and Rosemary Vilgan, current chair of the Commonwealth Bank Officers Superannuation Corporation, as part-time members of the board for five-year terms.

Mr Combet said he was “very honoured” to be appointed to the role, saying “the Future Fund is an outstanding national asset and significant investor on behalf of all Australians”. He is expected to take up the new job by the middle of this year. Fund board member Mary ­Reemst will act as chair in the interim.