SYDNEY, Nov 13 (Reuters) - Australia's financial position will be more precarious and credit rating at risk should the government succumb to the temptation to spend the sovereign wealth fund on political projects, its outgoing chair said in a speech on Monday.
The A$205 billion ($130 billion) Future Fund will come under pressure to fund state priorities as an aging population reduces taxpayers and consumes a larger chunk of spending, Chairman Peter Costello said on Monday at a UBS conference in Sydney.
"As government's financial position declines, I expect we'll see more plans to spend it," he said.
"Once it is spent there is nothing to offset government sovereign debt, unfunded pension and unfunded military claims.
Once it is spent the pressure to raise taxes and borrow more will accelerate."
Persons:
Peter Costello, Costello, telco, Lewis Jackson, Stephen Coates
Organizations:
SYDNEY, UBS, Labor, Liberal, Australia's AAA, telco Telstra, Thomson
Locations:
Sydney, China