In May 2005 when the Government formally announced the Future Fund would be established, it had no staff, no precedent in Australia, and most of all, no money. It was a time of excitement: no-one knew quite how this idea would work in practice.

For the founders, it was essential that it not be a government plaything. 

Legislation was prepared to set up the Fund with ultra-clear investment and operational goals that would be the envy of any investment organisation around the world. The Fund’s overarching purpose was to achieve a specific and focused investment target – and it would have the freedom to pursue that with few constraints. 

Legislation would strictly protect the mandate and the Fund’s ability to achieve it without meddling. It would make it extraordinarily hard for any government to step in and use the Fund as a piggybank or surreptitiously bend it in response to some unforeseen political or public pressures. 

Even the Government’s ability to exert pressure through budget cuts would be curtailed given the Fund’s operational costs would be drawn from the Fund itself. 

The Fund would need an independent Board protected by legislation to enshrine that independence in practice and spirit. 

The Board needed a Chair who understood how to run a rare hybrid organisation: a commercial business, owned by and accountable to the Government. 

Excerpts from Peter Costello’s speech for the second reading of the Future Fund Bill 2005 

The Future Fund Bill 2005 implements another important part of the Government’s long-term fiscal strategy. This is a bill which will put in place arrangements for future generations to allow them to deal with the massive changes that the ageing of the population will bring, from a much stronger financial position.

We are forecasting that by 30 June 2006, after 10 years of Coalition Government, we will have reduced debt by around $90 billion and, by doing so, released more than $6 billion a year from ‘dead’ interest payments to fund priority areas like health, education and national security.

With net debt now under control, we are turning our attention to addressing the largest single liability on the Government’s balance sheet: unfunded public sector superannuation. 

Australian coastline

Future Fund’s investment beliefs

Investment beliefs guide decisions 

The Future Fund’s investment beliefs shape the way it interprets its investment objectives and how it makes investment decisions. 

These beliefs were refreshed in 2020–21. 

connected people

Strong governance is essential to our success

global network

Risk is multifaceted and robust risk management enhances our ability to achieve our mandates

bulls eye

Our ‘One Team, One Purpose’ culture leads to better decisions and investment outcomes


Our primary focus should be on the value we add net of all costs, but we seek to utilise our scale and market standing to reduce costs

apex on mountain

A total portfolio approach will improve our long-term performance


We have a number of comparative advantages that, if properly utilised, will help us to achieve our mandates


Inefficiencies in markets create opportunities for us to add value through active management

A trusted relationship

Gordon McKellar knew Northern Trust was considered an outside choice as the Future Fund’s custodian, but he didn’t realise just how unusual until he met a super fund director at an industry function. 

“He turned around to me and said, ‘Am I right in saying you recently appointed Northern Rock as your global custodian?’” 

McKellar had to explain that it had not appointed the UK bank, Northern Rock, which had just been bailed out by the UK Government during the Global Financial Crisis. It was an unfortunate case of mistaken identity. 

Broken Hill Solar Farm. Image courtesy of Tilt Renewables

Broken Hill Solar Farm. Image courtesy of Tilt Renewables

An array of funds

While the Future Fund was established to strengthen the Commonwealth’s long-term financial position, over the years the Board of Guardians has also been charged with managing several other funds with diverse purposes. 

This shows the bipartisan respect it has earned as an astute and trusted investor. 

The Higher Education Endowment Fund (HEEF) was established in 2007 with an original contribution of $6 billion. After the election of the Labor Government in November 2007, the HEEF was closed and these funds were transferred to the Education Investment Fund established in 2009 under the Nation-building Funds Act 2008

The Nation-building Funds Act also established the Building Australia Fund, which was funded with $10.9 billion, and the Health and Hospitals Fund, which was funded with $5 billion. Both were established in January 2009. 

In 2015, the Government established the Medical Research Future Fund (MRFF) to provide an ongoing funding stream for medical research and medical innovation. The MRFF was initially seeded with $1 billion of uncommitted capital from the Health and Hospitals Fund which was then closed. The MRFF received a further $19 billion in contributions between 2015 and 2020 which came from health saving measures from the 2014–15 Budget.


Future Fund


Building Australia Fund


Education Investment Fund


Health and Hospitals Fund


DisabilityCare Australia Fund


Medical Research Future Fund

hills and sun

Aboriginal and Torres Strait Islander Land and Sea Future Fund

sun and layers of earth

Future Drought Fund


Emergency Response Fund