Taxpayers will get a "crappy" rate of return from a federal fund that is months away from investing in any Australian ideas, according to the coalition.
The May budget allocated an initial $5 billion to be invested by the new National Reconstruction Fund Corporation, which comes into existence mid-year.
The independent body will have an independent board that is yet to be appointed and an investment mandate that is yet to be finalised, a parliamentary committee has been told.
The actual rate of return has not been finalised, but the federal budget assumes earnings of $188.7 million on $5 billion.
Opposition finance spokeswoman Senator Jane Hume slammed the rate of return as being less than a term deposit, and lower than Australia's official cash rate.
"That looks like a pretty crappy rate of return to me," she told the senate estimates hearing on Thursday.
Senator Hume asked Assistant Minister for Manufacturing Tim Ayres if he was happy with that rate of return for taxpayers.
"Absolutely," he said.
Senator Ayres said the new fund would be an important means of working with the private sector and rebuilding manufacturing onshore in Australia.
There has been a range of special investment organisations across federal government for more than a decade, including the Clean Energy Finance Corporation that the latest federal body is modelled on.
Senator Ayres said good Australian research and commercialisation have gone offshore, and good jobs have been lost in the outer suburbs and regions.
"That has an impact on our capacity to deal with the big challenges of climate, security, of trying to push Australian exports up the value chain," he said.
"This fund is directed towards that work."
Australia is in fierce competition with the US and Europe for talent and investment as rival advanced economies roll out massive subsidies for low-carbon industries.
Start-ups and established players in critical minerals, advanced manufacturing and technology are keen to submit proposals for accessing loans and guarantees, or getting taxpayers to take a stake in their ideas.
Senator Ayres said the investment mandate, when provided, will give more guidance, not simply to the fund and applicants, but also to parliament and the public.
