Aboriginal and Torres Strait Islander Land and Sea Future Fund

The Aboriginal and Torres Strait Islander Land and Sea Future Fund (ATSILSFF) was established on 1 February 2019 by the Aboriginal and Torres Strait Islander Land and Sea Future Fund Act 2018 (ATSILSFF Act). It will support the making of annual and discretionary additional payments to the Indigenous Land and Sea Corporation (ILSC). The purpose of the ILSC is to assist Aboriginal persons and Torres Strait Islanders to acquire and manage land, water and water-related rights so as to attain economic, environmental, social or cultural benefits.

Legislation

The ATSILSFF Act gives effect to the following:

  • Investment Mandate: the responsible Ministers are required to issue at least one investment mandate to the Future Fund Board of Guardians (Board).
  • Crediting amounts to the ATSILSFF: the responsible Ministers can make credits to the ATSILSFF Special Account.
  • Debiting amounts from the ATSILSFF: The ATSILSFF Special Account can be debited for two main purposes: to transfer amounts to the ILSC Funding Special Account so that annual payments can be made to the ILSC, and to transfer amounts to the ILSC Funding Special Account so that discretionary additional payments can be made to the ILSC.

Investment Mandate

The responsible Ministers must give the Board at least one written direction about the performance of ATSILSFF investment functions. Before formally issuing an investment mandate direction, the responsible Ministers must invite the Board to make a submission on the draft investment mandate. Should there be a submission, it is tabled together with the investment mandate in both Houses of the Parliament.

The responsible Ministers must also invite the Indigenous Affairs Minister to make a submission on the draft investment mandate. In preparing a submission, the Indigenous Affairs Minister must invite, and then consider any submission received from the ILSC Board before it is sent to the responsible Ministers.

The Aboriginal and Torres Strait Islander Land and Sea Future Fund Investment Mandate Direction 2019 came into effect on 1 February 2019. It requires the Board to adopt a benchmark return of the Consumer Price Index + 2.0 to 3.0 per cent per annum, net of investment fees over the long term.

In targeting this benchmark return, the Board must determine an acceptable but not excessive level of risk for the fund, including having regard to the plausible capital loss from investment returns over the forward three year period. The Government acknowledges that targeting the long-term benchmark return implies accepting the risk of capital losses, in adverse markets, that may be 15-20 per cent of the portfolio over a three year period.

Contact information on this page: Funds and Superannuation Branch

Last updated: 02 May 2019