Sovereign wealth funds back on agenda, but many questions remain

Experience says that even a separate sovereign wealth fund doesn’t protect public finances from disaster

Former finance minister Charlie McCreevy set up the National Pension Reserve Fund in 2001. Picture: Rollingnews.ie

The debate over sovereign wealth funds has heated up. Business group Ibec has backed proposals by Finance Minister Michael McGrath to set up two investment funds — a long-term savings fund and an infrastructure fund.

Almost a quarter of a century ago, the National Treasury Management Agency (NTMA) unveiled plans to set up a sovereign wealth fund that was designed to help the State meet its unfunded bills from pensioners.