Go to top of page


Ministerial Directions

The NAIF Act is structured in such a way as to maximise NAIF’s operational independence particularly with respect to Investment Decision making. The responsible Minister gives NAIF direction through the NAIF Investment Mandate.

In addition, the Minister has provided NAIF with a Statement of Expectations which outlines in a formal and public way the Minister’s expectations on the operation and performance of NAIF beyond that considered by the legislative framework. The NAIF Chair has provided the Minister with a Statement of Intent outlining how NAIF will direct its operations to meet the Minister’s and Government’s expectations. The Statement of Expectations and Statement of Intent are available on NAIF's website.

Legislative Review of the NAIF Act

Section 43 of the NAIF Act requires a review of NAIF’s operations to occur as soon as possible after 1 July 2019. The review will cover among other things:

  • whether the time limit of 30 June 2021 for making decisions to provide financial assistance should be extended; and
  • appropriate governance arrangement for NAIF after that date.

This is broadly a review of the NAIF legislative framework. Responsibility for the conduct of this review sits with DIIS as the relevant policy agency supporting the responsible Minister.

ANAO Performance Audit of NAIF

In April 2018 the ANAO commenced an audit of NAIF with the objective of examining the effectiveness of NAIF’s governance and integrity framework. The report was tabled in April 2019 and will enable the organisation to further develop its governance framework. Amongst other things the ANAO concluded that:

  • NAIF has an appropriate governance framework, including systems of risk management and internal control;
  • NAIF has an appropriate integrity policy framework; and
  • NAIF’s management of conflicts of interest was effective.

The ANAO made six recommendations in relation to NAIF operations as set out in Figure 6 below. NAIF has accepted all recommendations in the report and is committed to implementing these recommendations, some of which have already been actioned.

In line with best practice, NAIF will be engaging independent expertise in developing, monitoring and reporting against a work program and implementation plan for the ANAO’s recommendations (Work Plan). Expert advice may also be sought to assist with design processes to address components of the recommendations.

The Board intends to have appropriately prioritised, addressed and implemented all recommendations and suggested actions within twelve months of the implementation of the Work Plan. The Board also intends upon completion of all implementation work to seek confirmation that the Work Plan has been satisfactorily carried out. Implementation work will progress over FY19-20.

Figure 6: ANAO recommendations and NAIF response

ANAO Recommendation

NAIF response in ANAO Audit Report

The NAIF publish criteria and all information necessary for applicants to submit complete applications for grants of financial assistance.

Agree: The NAIF Act and published Investment Mandate provide a comprehensive list of five mandatory criteria and at least an additional 27 requirements that the NAIF Board must either consider, have regard to or be satisfied with in making an Investment Decision. In addition, the NAIF website publishes a detailed outline containing other information required as a project is assessed. Notwithstanding this existing transparency NAIF undertakes to assist proponents by publishing case studies and further guidance.

The NAIF develop an information governance framework, electronic data and records management system, and appropriate records disposal authorities in line with National Archives of Australia requirements.

Agree: NAIF has commenced engagement with the National Archives of Australia (NAA) on the implementation of an information governance framework, including data and records management, in line with NAA requirements. NAIF will progress this work over 2019 to meet the requirements of the Australian Government’s Digital Continuity 2020 Policy.

The NAIF publish more information about decisions, public benefit assessments, environmental assessments and Indigenous engagement strategies.

Agree: Taking into account the requirements of NAIF’s legislative framework to uphold both public accountability and appropriately maintain commercial in confidence information NAIF commits to, at a project or portfolio level as appropriate, continue to publish more information, by way of case studies, about its Investment Decisions together with examples of expected public benefit, Indigenous engagement strategies and environmental outcomes from NAIF investments.

The NAIF cease the use of all non-official email accounts and servers to conduct official business.

Agree: NAIF has ceased the use of non-official email accounts, for any NAIF business. This does not extend to stakeholder or proponent engagement via the email accounts provided by those parties.

The NAIF select projects at each assessment stage on a consistent and transparent basis in accordance with published criteria, and retain adequate documentation to record the rationale for decisions made and actions undertaken.

Agree in principle: NAIF has and will continue to consistently select projects by assessment against the published NAIF requirements which will include at the strategic assessment stage whether mandatory criteria have potential to be satisfied and at the Investment Decision stage whether the requirements have been satisfied. NAIF will refine its published guidance material to elaborate on the type of information and factors that may be taken into account at each stage noting projects vary on their facts and that expert commercial judgement is always applied. In addition, while NAIF strenuously rejects any assertion that its decisions have not been based on robust and consistently applied processes, NAIF will strengthen its internal protocols around documenting its rationale for early stage assessments.

The NAIF revise its performance measures and targets to provide clearer accountability and transparency in the measurement of its performance, and measure and report on the realisation of public benefit.

Agree: NAIF’s performance measures have been subject to review by its internal audit function, which has found the existing performance measures are considered relevant, reliable, complete and meaningful. The NAIF Board reviews all performance measures annually in a manner consistent with guidance provided through materials including the Public Governance, Performance and Accountability Act 2013 and Department of Finance Resource Management Guides. Within its capacity NAIF will monitor and publish information on public benefit realised through NAIF investments.

Senate Inquiry into the Governance and Operation of NAIF

On 14 June 2017, the Senate referred an Inquiry into the Governance and Operation of NAIF to the Senate Economics Reference Committee. NAIF’s submission and the CEO’s Opening Statements to the Senate Inquiry can be viewed on the NAIF website. The Committee held five public hearings in FY17-18 of which NAIF appeared at two (Canberra and Cairns). The Senate Committee tabled its report on 6 July 2018.

NAIF Act – Section 42 Reporting

For the purpose of section 42 of the NAIF Act, NAIF reports as follows.

  1. Investment Mandate changes: There were no Investment Mandate changes during FY18-19.
  2. Summary of proposal notices given to the Minister: NAIF must give the responsible Minister a proposal notice under section 11(2) of the NAIF Act for each project on which it proposes to provide financial assistance being a written notice of the proposal. NAIF provided notices for the six Investment Decisions made by the NAIF Board between 1 July 2018 and 30 June 2019. See Figure 7 Summary of proposal notices.
  3. Summary of rejection notices by the Minister: There were no rejection notices from the responsible Minister during the period.
  4. Summary of projects for which financial assistance was approved during the period: Figure 8 below provides a summary of each project supported by an FY18-19 Investment Decision.
  5. Summary of adjustments or concessions made by NAIF in relation to infrastructure projects that have not progressed as planned: There were no adjustments or concessions of this type during the reporting period.

Figure 7: Summary of proposal notices




Maximum value of NAIF Investment Decision

Pilbara Minerals Limited[1]

Pilgangoora, WA

Upgrade of public road


Sheffield Resources Limited

West Kimberley, WA

Thunderbird mineral sands


Queensland Airports Limited

Townsville, Qld

Redevelopment and expansion of Townsville airport terminal


Northern Territory Airports Pty Ltd

Darwin, Tennant Creek, Alice Springs, NT

Freight, transport, energy and solar


Alinta Energy Pty Ltd

Pilbara, WA

Chichester solar gas hybrid


Kalium Lakes Limited

Beyondie, WA

Beyondie sulphate of potash


[1] This project will not proceed to financial close, see footnote 1, Figure 4

Figure 8: Summary of projects supported by an FY18-19 Investment Decision


Pilbara Minerals Ltd[1]

Sheffield Resourced Ltd

Northern Territories Airports Pty Ltd

Queensland Airports Ltd

Alinta Energy Pty Ltd

Kalium Lakes Ltd

NAIF Loan $ approved amount







Type of Infrastructure

Upgrade of a 70km public road to support the Pilgangoora lithium-tantalum mine.

LNG power generation facility, upgrade roads and port infrastructure to support the Thunderbird mineral sands project.

Freight and cold storage and export hub at Darwin International Airport, solar arrays at Darwin, Tennant Creek and Alice Springs, an off-site multi-user battery, and runway upgrades.

Redevelopment of Townsville Airport terminal including new core infrastructure (water, fire, waste facilities).

60MW solar PV power station, transmission infrastructure, switchyards and substations to supply electricity.

78km gas pipeline, gas fired power station, road and communication infrastructure, an airstrip and an accommodation village to support the Beyondie Sulphate of Potash project.

Type of finance


loan (2 facilities)




loan (2 facilities)


10 years

20 years / 15 years

20 years

15 years

20 years

12 years / 17 years


√ (both facilities)

√ (both facilities)



√ (both facilities)

√ (both faclities)


Interest rate Concession

Interest capitalisation

Interest only

Returns to Commonwealth

Each loan pays an upfront facility fee and an interest rate above the Commonwealth cost of borrowing.

Risks to Commonwealth

Each loan has been rigorously assessed during the due diligence process to ensure the risks are understood and mitigated where possible. Risks include: project, credit, transaction, structure, environmental & social, construction, technology, operation, management, market, industry, business, financial and concentration risk.

[1] This project will not proceed to financial close refer to footnote 1 Figure 4.

Indemnities and Insurance

NAIF has entered into arrangements through Comcover and Comcare. During the year NAIF maintained and paid premiums for Comcover and Comcare programs which, amongst other things, indemnify Directors, officers and employees against various risks and liabilities including directors and officers liability and professional negligence and related legal costs. Total premiums paid during the reporting period were $29,111.