SENATOR THE HON KATY GALLAGHER
MINISTER FOR FINANCE
MINISTER FOR WOMEN
MINISTER FOR THE PUBLIC SERVICE
SENATOR FOR THE ACT

E&OE TRANSCRIPT
RADIO INTERVIEW
ABC CANBERRA
FRIDAY, 22 NOVEMBER 2024

SUBJECTS: Future Fund; representation of Territories in the Senate.

ROSS SOLLY, HOST: Good to have your company this morning. We’re now joined by the federal Finance Minister and, of course, Senator for the ACT, Katy Gallagher. Big news week this week, of course as always when you’re a federal minister. Katy Gallagher, thanks for your time.

SENATOR THE HON KATY GALLAGHER, MINISTER FOR FINANCE: Good morning, Ross, thanks for having me on.

SOLLY: Let’s talk about the Future Fund first of all. John Howard says that the direction or the advice given by Jim Chalmers and yourself to the Future Fund is fiscal vandalism. Peter Costello says that you are at risk of setting up a political slush fund. What do you say to those two criticisms?

GALLAGHER: Well, both of those are just factually incorrect. I disagree with both of them, which wouldn’t be surprising, I don’t think, to many of your listeners –

SOLLY: No, but they set up the Fund and they had a vision for how it would work, and they put in safeguards to try and make sure that there couldn’t be political interference. Now they’re saying –

GALLAGHER: Well, there is no political interference, Ross. I just completely reject that. We have a process –

SOLLY: So, what was the direction, then?

GALLAGHER: Well, with the Future Fund, there is the opportunity for the shareholder ministers to provide a statement of expectations and an investment mandate for the Fund. Those have both existed. What we have done is simply add in, and I don’t think many of your listeners will be shocked to know that we think using our sovereign wealth fund without any change to risk or the rate of return – so that maintains exactly as Peter Costello set it up – the exact same rate of return, no change to the risk level, the Fund has to consider that first. But that they should consider when they are making investments, investing in those national priorities of housing, infrastructure and the energy transition. That’s simply the only change and the response, particularly from the Liberal party, has been pretty hysterical on this.

SOLLY: Okay, but let’s compare this with the way we tiptoe around giving the Reserve Bank any advice or giving any suggestions. You, and rightly so, everyone goes out of their way to make sure there is no hint at all given of any indication of what the Reserve Bank should do with interest rates. This is a totally different approach isn’t it? You’ve actually said, how about you look at investing in future, some of the money towards these sorts of projects.

GALLAGHER: Well, that’s why we have a statement of expectations. I mean, the way – and it’s quite different to the way the Bank operates – this is a fund that has shareholder ministers involved, and the Act sets out how you have an investment mandate and a statement of expectations. That hasn’t been updated for 15 years. And I know, because I am the shareholder minister in a lot of other of our companies and special investment vehicles, it is absolutely routine to update investment mandates and statements of expectations. It’s just routine. It hasn’t happened with the Future Fund, so I accept –

SOLLY: Well, I was going to say, it’s not that routine. It’s not that routine, not for the Future Fund, because this is the first time that it’s actually happened, so that’s not routine at all.

GALLAGHER: Well, all I’m saying is yes, I added in that I accept it hasn’t happened with the Future Fund – but Ross, the response to this, and I’m not surprised, from either the conservative media or former conservative politicians to come out like this. You know, the question before the government is, you have this huge pool of funds that is there for a purpose. It has been incredibly successful in providing returns and building up a wealth of resources. It is already probably one of the biggest investors in renewable energy in this country. What Jim and I have done is simply say, putting aside risk and rate of return – because those remain exactly the same – when you are considering your investments, here are some things that we believe are in the national interest. Housing, infrastructure and energy transition.

SOLLY: But why do you even need to do this? I mean, the Future Fund is set up as an independent body. You have Greg Combet there, a former colleague of yours that’s running the show. I’m assuming you’ve appointed people there that you trust to do the job properly. Why is that the government needs to intervene here? This, potentially, is a slippery slope, Katy Gallagher, is it not?

GALLAGHER: It isn’t, Ross. No, I just totally disagree. The Act sets out–

SOLLY: So, what’s to stop the next government, like for example, Kevin Rudd at one stage wanted money put in towards the NBN. That was knocked on the head and the rules were changed so that couldn’t happen.

GALLAGHER: We are not directing the Future Fund about where to make investments. So that argument is absolutely incorrect. I’ve heard it over the last 24 hours, that you know, this fund’s going to be raided, that people get directed where to put investments. That is not allowed under the Future Fund Act, so that is not happening. And that’s what I mean about this – the conservatives’ hysterical response to this – it’s not what’s happening.

SOLLY: Okay, but Katy Gallagher it’s the look, though, isn’t it? Why do it? Why would the government sit there and say, tell the Future Fund, might be a good idea if you look at putting your funds there? It’s just, whether the Future Fund takes up your advice or listens to it, that’s another thing. It’s just the look from the outside that this is a government trying to influence the Future Fund to put money towards a certain area. That’s the look. Whatever you say about it, that’s the way it comes across.

GALLAGHER: Well, I accept that that’s the way you see it, Ross. I see my job as one of the ministers responsible for the Future Fund, that my job and Jim’s as the Treasurer, is to make sure that that Fund is as strong and as successful as it can be. And that is what our job is. Our job is not to just sit there and say, there’s no change ever, ever, to be done to this institution because when it was created 20 years ago, that was the only way it could operate. The Act sets out an opportunity for shareholder ministers, in consultation with the Future Fund Board of Guardians, which is what Jim and I have done. We went and met with the Future Fund Board of Guardians, and we talked with them about all of their issues and looking at areas of national priority before settling this with the Future Fund board. And all we have done is say, when you are considering investments, we think these things are really important in the next decades and consider those. Not direct them, not change the rate of return, not change anything else about how the Future Fund operates. I think people expect us to do our job and make sure that their sovereign wealth fund is as strong and as successful and as sustainable as it can be into the future. And that is the only change.

SOLLY: Some of the critics are also saying well, it’s Future Fund today, super tomorrow. I mean –

GALLAGHER: But I mean, again, I deal with a lot of criticism, obviously, as a politician in our jobs. But the response to this modest change to the way the Future Fund – the investment mandate and the statement of expectations – is really out of proportion to the change. We are not doing anything, we are not taking money out of the Fund, we are not directing money go anywhere, we are not telling the Future Fund Board of Guardians what to do. We have simply said, when you are making your decisions, this is some things we think are really important to invest in in the country.

SOLLY: Okay. Just on one other issue if I can please, Senator Gallagher. Earlier this week we had independent senator David Pocock on the show, he stood up in the parliament again this week and raised the issue of federal parliamentary representation here in the ACT. He said that he contacted all the local representatives including yourself looking for support and all he heard was crickets. This is what he had to say.

DAVID POCOCK: I find it pretty extraordinary. The Joint Standing Committee on Electoral Matters recommended the doubling of senators to four. Labor then put it in their party platform, then they bring forward electoral reform in the last two sitting weeks of the year and it’s not in there. It’s – why do the ACT, why do the people in the ACT keep getting taking for granted by the major parties?

SOLLY: But we had Alicia Payne on this program, we’ve had Andrew Leigh on this program, I think even Katy Gallagher’s been on this program saying we need more representation. I mean, what’s going on here?

POCOCK: Well Ross, when push comes to shove, as you know, you’ve got to toe the party line.

SOLLY: Is he right, Katy Gallagher? Why are you not supporting his push? Are we walking away from this now?

GALLAGHER: Well, the Labor party, independently of Senator Pocock, has supported additional Territory representation. It is not part of this Bill because this Bill is about donation reforms and campaign donations and spending. And we think that was a priority and I totally agree that that is the priority. So, real-time donation transparency, limits on campaign spending so that billionaires aren’t funding our democracy, basically – and we saw that in the ACT when Senator Pocock himself spent nearly $2 million on his campaign. So campaign spending is out of control and that is a priority.

SOLLY: I think we all understand that. It is just a question of, what’s happening with our increased representation?

GALLAGHER: It’s not in this Bill, but as Senator Pocock knows – look, he wrote a letter to us, it appeared I think pretty quickly in the Canberra Times – we had responded to that. So, it’s not fair to say that he heard crickets. That is not correct. Senator Farrell on our behalf and with our consultation responded to his letter and explained that this bill is around donation reform, but that this is something that Labor will pursue in the next Parliament. And that remains our position. It’s in our platform, we remain committed to it. But I would say also that while I do think it’s a really important issue that we are appropriately represented, we do need to continue to consult across the Parliament about how this is delivered.

SOLLY: Some might say that we’ve had enough reviews into this, but I’m hearing what you’re saying. Senator Katy Gallagher we are out of time, but I thank you for yours. Senator Katy Gallagher, we are out of time, but I thank you for yours. Thank you.

GALLAGHER: Thanks, Ross.