SMSFs still locked out of infrastructure investment: ASFA
Self-managed superannuation funds (SMSFs) could have a big future in infrastructure investment, but currently a large proportion are "locked out" by a closed and illiquid market, an industry body believes.
Speaking at the International Symposium for Next Generation Infrastructure, Gordon Noble, a director at the Association of Superannuation Funds Australia (ASFA), said opportunities continue to be missed because of poor planning or short-sightedness.
Noble said superannuation funds had a long, often unrecognised, history of infrastructure investment, which has been held back by illiquidity.
"As the size of the superannuation pool grows, the search for liquidity and diversification will drive superannuation funds to increase their exposure to international equity markets," he said.
Another challenge he pointed to was the fact a third of SMSFs were "effectively locked out of investment in infrastructure".
"There are opportunities to either establish infrastructure bonds or commercial products that provide a diversification of projects," he said.
Noble said ASFA would also like to see a pipeline of infrastructure projects and wants to open a dialogue with the Government about future infrastructure guarantees, particularly on small-scale investments.
Recommended for you
Treasurer Jim Chalmers has handed down his third budget, outlining the government’s macroeconomic forecasts and changes to superannuation.
Online investment adviser and fund manager Stockspot has introduced Stockspot Super, Australia’s first 'ETF only' superannuation product. superannuation product.
ASIC has called on superannuation funds to improve their oversight of advice fee deductions following an investigation of 10 trustees that found $990 million was charged in one year.
With just 30 per cent of Australians knowing their superannuation balance to the nearest $1,000, Findex has emphasised the role of financial advice in addressing the critical super knowledge gap.