Shadow Treasurer Wayne Swan this
morning seized on the inconsistency of the government’s plan to manage
some of the Telstra sale via the proposed “Future Fund,” which is
supposed to be completely independent of government, describing it as
“a complete corruption of the fund.”
With any luck, that will lead him to more aggressively question the
whole idea of the Future Fund, since it may not be too late to kill it.
The government seems to think that owning a controlling interest in one
large company is anti-competitive, but owning substantial interests in
a number of such companies will not be.

In reality, the
government will have the same problem with Future Fund investments as
it does with Telstra: either it uses its shareholder power, in which
case politics are interfering with the market, or it doesn’t, in which
case it leaves management unaccountable and contributes to a culture of
shareholder irresponsibility. To hold shares, but not vote in the
interests of their owners, the taxpayers, is irresponsible.

The
argument for the Future Fund (apart from just being a way to hide spare
cash) is that it will provide backing for the government’s large
unfunded superannuation liability for public servants. But a much
better way to fund superannuation is to let the employees choose a fund
and invest the money themselves, just as workers in the private sector
can do.

The only reason for not doing this, and keeping a
separate government superannuation fund, is the fact that it is
unfunded. If, from the sale of Telstra, the government has the money to
fund it, that justification disappears.