Legislative Assembly for the ACT: 2008 Week 06 Hansard (Thursday, 26 June 2008) . . Page.. 2156 ..
On an unrelated matter, I made some observations early in this debate over the circumstances or demeanour of Mrs Burke in relation to the estimates committee. Matters have been brought to my attention since then that make it very clearly evident that there were other factors in play, not just the dispute about the line of questioning, and for that I apologise. I will leave my comments at that point.
Proposed expenditure agreed to.
Proposed expenditure—part 1.9—Superannuation Provision Account—$133,763,000 (capital injection), $7,736,000 (payments on behalf of the territory), totalling $141,499,000
DR FOSKEY (Molonglo) (9.45): A great deal of what I said on part 1.6, territory banking account, also applies to part 1.9, superannuation provision account, so I just say on this one: ditto.
MR SMYTH (Brindabella) (9.45): Funds in the superannuation provision account provide superannuation benefits to retired employees of the ACT government. A critical issue with this account is the point at which the estimated liabilities for superannuation begin to fall. It is now estimated that the peak in superannuation liabilities will be reached in June 2037. The liabilities that are funded from these funds are superannuation entitlements in a defined benefit arrangement. For many years these liabilities when paid as superannuation benefits were simply funded from normal government funds.
The ACT government has put in place a program to achieve the full funding of this liability by 2030 and, while the budget papers estimate that this funding proportion will fall from 65 per cent to 63 per cent next financial year, it is also estimated that, by June 2012, 67 per cent of this liability will be funded.
A significant issue facing the ACT government with respect to the investment of these funds in the superannuation provision account is the way in which these funds are invested. There is increasing interest in seeing superannuation funds, amongst other financial organisations, investing funds according to the principles of responsible investment as set out by the United Nations. Adherence to these principles has considerable merit, although the implementation of such an investment strategy will have to be carefully assessed and evaluated.
I draw members’ attention to pages 32 and 33 of the estimates committee report. It discusses the SPA and part of the discussion centred on the strategic allocations strategy which we were told was nearly completed. Recommendation 18 says:
The committee recommends that the government report to the Legislative Assembly on the outcomes of the Superannuation Strategic Investment Review.
The most interesting of answers was the one-word answer from the government: they simply agree. We look forward to seeing the strategy, what it means and the implications that it will have for the SPA.