Leading up to the 2022 federal election, the (then) Opposition Leader Anthony Albanese pledged in early 2022 that he would use Labor’s proposed $15 billion National Reconstruction Fund to make technology and local manufacturing investments a top priority.
Labor went on to win the election, and enacted the fund.
The objective of the NRF is to provide a financing vehicle to drive investment in projects seeking to build prosperity across the country, providing loans, guarantees and equity to support specific projects.
It will be run by an independent body, the NRF Corporation, governed by a Board with expertise in a range of sectors, which will make independent decisions to provide finance to Australian-based investments.
The NRF Corporation’s Investment Mandate, published by minister for industry Ed Husic and finance minister Katy Gallagher this week identified key priorities of:
- renewables and low emission technologies;
- medical science;
- value-add in agriculture, forestry and fisheries;
- value-add in resources;
- defence capabilities; and
- enabling technologies.
The Investment Mandate requires the NRF Corporation to operate on a commercial, self- sufficient basis, and to target a rate of return of 2-3% above the five-year Australian Government bond rate over the medium to long term.
Mr Husic said, “signing off on the investment mandate means the NRF can get cracking on rebuilding our manufacturing capabilities and supply chain resilience”.
The Government has faced criticism from some for how long it has taken to establish the fund, especially considering that another key government program (Accelerating Commercialisation) was closed in May. However to be fair, it was important that the Government not hastily deploy funds in a high inflation environment.
Hopefully the capital deployed by NRF is allocated to worthy projects that provide value for the taxpayer and the country.