Future Fund

The Future Fund was established 3 April 2006 by the Future Fund Act 2006 External Site (Future Fund Act). The Future Fund is a financial asset fund, set up to strengthen the Commonwealth's long-term financial position by making provision for unfunded superannuation liabilities that will become payable during a period when an ageing population is likely to place significant pressure on the Commonwealth's finances.


The Future Fund Act gives effect to the following:

  • Establishment of Government bodies: the Future Fund Board of Guardians (Future Fund Board); and the Future Fund Management Agency (Agency):
    • the Future Fund Board is accountable to the Government for the safekeeping and performance of the Australian Government Investment Funds; and
    • the Agency supports the Future Fund Board in performing operational activities associated with funds’ investments.
  • Investment Mandate: the responsible Ministers are required to issue an Investment Mandate (detailed below).
  • Crediting amounts to the Future Fund: the responsible Ministers make credits to the Future Fund, so long as the additional amounts do not result in the balance of the Fund exceeding the Target Asset Level (detailed below). For information on the credits, refer to the Investment Performance and Financials webpage.
  • Debiting amounts from the Future Fund: the responsible Ministers can debit (drawdown) from the Future Fund in accordance with the purposes of the Future Fund Act:
    • to discharge unfunded Commonwealth superannuation liabilities once the balance of the Future Fund is greater than or equal to the Target Asset Level, or from 1 July 2020, whichever is earlier; or,
    • meet expenses associated with the investment function and administration of the Future Fund.

Nominated Minister

The nominated Minister has responsibilities for aspects of the operations of the funds, including; determination of the Designated Actuary for the Future Fund; publication of the Target Asset Level Declaration; matters relating to the Future Fund Board; and requesting reports and information from the Future Fund Board. The following determination appoints the Finance Minister as the nominated Minister for the Future Fund Act:

Investment Mandate

The responsible Ministers provided the Future Fund Board with strategic investment guidance through a written direction in respect to the Future Fund. This is a legislative instrument that is not subject to disallowance.

The Future Fund Investment Mandate Direction 2017 requires that the Future Fund Board adopt a benchmark average return for the Future Fund of “at least the Consumer Price Index (CPI) +4.0 to +5.0 per cent per annum over the long term”. In striving for this benchmark return, the Future Fund Board may pursue an acceptable, but not excessive, level of risk.

Target Asset Level

The Target Asset Level is the best estimate of the Future Fund balance that would be required to offset the present value of projected unfunded superannuation liabilities, accrued up to the same point in time.

The Future Fund Act provides that a comparison of the Future Fund's balance with the Target Asset Level is required when considering whether to:

  • drawdown from the Future Fund to meet Government superannuation benefit payments prior to 1 July 2020; or
  • credit amounts to the Future Fund.

Prior to 1 July 2020, if the balance of the Future Fund was greater than or equal to the Target Asset Level for the relevant financial year, then withdrawals can be made. However, if the balance is lower than the Target Asset Level amounts cannot be withdrawn from the Future Fund. From 1 July 2020, withdrawals from the Future Fund to meet unfunded superannuation liabilities do not need to take account of the Target Asset Level.

The latest Target Asset Level Declaration of 6 July 2018 specifies and explains the target asset levels for the 2017-18 to 2019-20 financial years:

The Target Asset Level for the Future Fund is set by the Designated Actuary, who must take all reasonable steps to ensure that there is a target asset level in place for a financial year and that not more than five target asset levels for different financial years are in place at the same time. The current determination is below:

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Contact information on this page: Funds and Superannuation Branch

Last updated: 04 January 2019