Page 1805 - Week 07 - Tuesday, 15 June 1993
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MRS CARNELL (Leader of the Opposition) (5.18): I will speak very briefly on this because Mr Kaine and Mr Moore have very adequately covered the position of the majority of the committee. I think that Mr Moore hit the nail on the head when he said that our major undertaking in this area is to protect the superannuation funds of those who have contributed and that that must be the basis upon which all decisions are made. It was with that in mind that the committee, I think, rightly suggested that we should restrict the amount that is invested in derivatives to 5 per cent. I think that is the job of this Assembly.
Ms Ellis's and Mrs Grassby's view that we should not interrupt, in any way, what fund managers may decide is inappropriate, taking into account where this money comes from. It is superannuation money; it is the basis upon which people plan their futures. To put more than 5 per cent into this very speculative area takes huge risks with people's future, with people's retirement, with money that does not belong to this Assembly. I think it is an exceedingly appropriate limit to place on that.
In fact, as Mr Kaine said, we were told by some people who appeared before the committee that 5 per cent was too high; that zero per cent was closer to the truth. It was suggested that to attempt to do better than the market was to overestimate greatly the capacity of any long-term fund manager. You really have to balance people who manage to do better than the market against the fact that an equal number of people are going to do worse than the market. Therefore, in any long-term investment portfolio, particularly one that is based upon people's retirement money, you really have to make sure that you do as well as the market, and then, without risk, attempt to do better.
What was then put to us was that the only way to do better than the market, or at least to do as well, was to have a management board; to have somebody within our own Treasury, within our own ACT Government, to keep an eye on what was happening with these external fund managers. It was put to us very strongly that without that sort of management board there was nobody out there keeping a very definite eye on long-term investment strategy. I strongly suggest to the Government that they look at these recommendations appropriately. They have been looked at - - -
Ms Follett: We certainly will; don't worry.
Mr Berry: Very appropriately.
Ms Follett: Rest assured.
MRS CARNELL: I am sure that you will. They have not been come to lightly by the Public Accounts Committee. We have spoken to a number of people who have expertise in this area. I commend the report.
MRS GRASSBY (5.21): I rise to speak on the report by the Standing Committee on Public Accounts. As members will be aware, I and my fellow member Ms Ellis have advised the chair of the committee of our dissent from this report. Madam Speaker, my fundamental concern is that the majority view of the committee reflects the underlying but as yet unclassified concerns of those members. As a consequence the recommendations, particularly those relating to the proposed management board, are far from clear.
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