Policy-makers wanting superannuation funds to invest in infrastructure need a detailed understanding about how the funds actually make investment decisions and therefore what is possible, according to the Association of Superannuation Funds of Australia (ASFA).
In a research paper released last week, ASFA pointed to Australia's infrastructure needs and the capacity of superannuation to help, saying that currently infrastructure investment managers invest around $48 billion in infrastructure assets, and that compared to the size of the superannuation pool at $1.4 trillion, "this is a drop in the bucket".
The ASFA research paper said that as the size of the superannuation pool grows and with State and Federal Governments facing fiscal constraints, it was likely policy makers would only focus more attention on the superannuation sector.
"In this environment it is important that the superannuation sector actively participates in discussions around ways in which the superannuation pool can be used to address economic and social objectives," the research paper said.
However it added that it was important that policy makers had "a detailed understanding of how superannuation funds actually make investment decisions, and what is possible, and what is not".
The research paper said that the way in which superannuation funds invested in infrastructure – and the actual assets that superannuation funds invested in – would ultimately be determined by how deals are structured.
It said that in addition to investing in transport infrastructure that addressed supply-side challenges, superannuation funds also had the capacity to invest in assets that addressed demand-side challenges.
"Because superannuation funds are diversified, [for] investors that invest in assets across the real economy there can be more than one way to 'skin the cat' that can deliver the same objectives," the ASFA research paper said.
