Treasurer Daniel Mookhey will order a consolidation of six funds and stop borrowing billions of dollars to invest in financial markets.
Borrowing billions of dollars to invest in volatile financial assets has been deemed too risky in a high inflation and high interest rate environment, while the government’s budget is in deficit and gross debt is projected to hit $187 billion by 2025-26.ahead of his first budget on September 19, Mr Mookhey said suspending contributions to the generations fund would slash the state’s gross debt by more than $7 billion and cut interest payments by $1.1 billion over the next four years.
“Reforming the NGF will allow us to shake up how the state’s investment funds are managed. That is a reform opportunity we intend to take.”Brook Mitchell Separately, the consolidation of TCorp’s investment funds will seek to achieve a more cost-effective structure and deliver higher after-fee returns.
The government will task TCorp with developing a reform to maximise the state’s investment returns by initially consolidating six separate government funds, of about $43 billion, into a more cost-effective structure.n in an effort to cut costs and enhance the government’s ability to manage its assets and liabilities.
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