AUSTRALIA - Prime minister Julia Gillard today rejected the idea of starting a sovereign wealth fund calling superannuation funds themselves "our trillion dollar sovereign wealth fund, but with market benefits".
Speaking at a financial services council breakfast, she said: "Some say in the current economic environment we should be considering establishing a sovereign wealth fund. I take a different approach. I believe that superannuation is already our trillion dollar sovereign wealth fund, but with market benefits. That's because it's privately managed by thousands of trustees instead of a sovereign wealth fund managed centrally by a Canberra-appointed manager."
She said the country's A$1.4trn ($1.5trn) savings pool helped to recapitalise ailing businesses during the financial crisis. Some A$40bn was raised in institutional share placements in 2008 and 2009, while 15% of capital raising globally in the same time period was in Australia.
"In rocky international seas, super is an anchor," said Gillard.
She also reiterated the government's plan to raise the superannuation contribution rate to 12% from 9% by 2020.
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers