The entity responsible for overseeing the Albanese government’s signature $15 billion National Reconstruction Fund has been formally established, almost six months after the legislation passed through Parliament.
The National Reconstruction Fund (NRF) Corporation came into being on Monday – the same day that the eight-member board of directors established to make investment decisions held its first meeting.
Governor-General David Hurley signed off on a proclamation declaring the beginning of the NRF Corporation Act late last week, bringing forward the automatic start date of the corporate Commonwealth entity by two weeks.
The formation of the NRF Corporation means that the special account that will deliver loans, guarantees and equity to companies across seven priority areas like renewables and critical technology has been credited with its first $5 billion.
The remaining $10 billion would be credited to the account from the Consolidated Revenue Fund in installments over the next six years at the government’s discretion, according to the NRF Corporation Act.
A spokesperson from the Department of Industry, Science and Resources confirmed the creation of the corporation, but would not comment on the initial staff levels, suggesting it is not yet fully operational.
“The NRF Corporation board will be responsible for making all decisions on corporation staffing, including the initial workforce and work to recruit a chief executive,” the spokesperson told InnovationAus.com.
The board, led by former Clean Energy Finance Corporation director Martijn Wilder, was appointed by Industry and Science minister Ed Husic last month and met in Sydney for the first time on Monday.
Mr Husic, who sat in on the first meeting of the board, described the creation of the NRF Corporation and the board meeting as a “milestone day”, marking the “formal transfer of responsibility” of the NRF.
“The government has brought together a strong mix of skills and experiences from all parts of the nation to help ensure the NRF delivers for Australians,” he said in a statement, adding that each of the members will work to strengthen Australian manufacturing..
The government is yet to decide on the investment mandate, which will specify the rate of return for the $15 billion industry fund and be used by the eight-member board to make independent investment decisions.
The Clean Energy Finance Corporation (CEFC), which the NRF is modelled on, has a benchmark rate of return of the bond rate plus three to four per cent for investments, with the benchmark rate for its Clean Energy Innovation Fund and Advancing Hydrogen Fund set slightly lower at one per cent.
In recent weeks, calls have been growing louder for the government to respond to industrial policies being set in countries like the United States by committing 10 times the available funding through the NRF to turbocharge the local manufacturing sector.
A broad coalition of interest groups, including investors and environmentalists, last week proposed that the government create a green industries support package worth at least $100 billion to respond to the huge levels of support available through the US Inflation Reduction
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