After terminating a comprehensive mandate with Chifley Financial Services, the $660 million NSW Aboriginal Land Council (NSWALC) fund is reassessing its outsourced investments.
The NSWALC acted on advice from its asset consultant, Watson Wyatt, to terminate the mandate, which had seen the CHIF Wholesale fund implement the Land Council’s conservative investment strategy by appointing external managers.
I&T News understands that the NSWALC would save up to $1 million a year in fees by ending the mandate with Chifley and directly appointing external managers, as an additional layer of fees was effectively stripped out.
A spokesman for NSWALC said the organisation would not publicly discuss details or decisions involving the statutory investment fund, outsourced investment contracts or asset allocation.
However I&T News understands that the land council has begun reassigning Australian equities managers and will gradually reassess its holdings in other asset classes since culling Chifley.
Akin to a university endowment, the NSWALC fund supports local Aboriginal land councils in NSW with earnings from its investments. The NSWALC was set up in 1983 and the original capital sum of its fund was built from an equivalent of 7.5 per cent of tax on non-residential land paid by the state over 15 years. Its conservative investment strategy targets an annual return of 5 per cent above the consumer price index.
Chifley Financial Services was established by Unions NSW but is now owned by the Local Government Superannuation Scheme, the Energy Industries Superannuation Scheme and the Labor Council of NSW.