Australia is ready for a more sophisticated market in impact investing according to Michael Traill, who has spent almost two decades encouraging Australians to invest for profit — and good.
As the chair of the federal government’s task force on social impact investing — investment measured by both financial returns and success in a social objective — Traill argues the nation needs to scale up for a potential $60bn market by setting up a “wholesaler” to bring deals to potential investors.
The task force has just presented its final report to the government and while its recommendations are still under wraps, Traill tells The Deal the group has identified the need to develop the “architecture” of the market to offer more products to investors such as superannuation funds, foundations, philanthropists and those prepared to accept a “below conventional risk return”.
“I think there is an appetite for larger scale impact investing,” he says. “There’s been an evolution and a set of developments over the last decade that would suggest that this market is ready for that but it would need some encouragement and stimulation for that to happen.” Till now most investments of this sort in Australia are about $50,000 to $10m but Traill sees potential for a spread of investments with up to $50m at the top end.
He says some industry superannuation funds, such as HESTA, have been proactive, showing financial returns consistent with the “sole purpose test” which directs funds to invest only for the retirement benefit of members.
The task force, set up in the 2019 federal budget to investigate the role the commonwealth should play in developing investment to “provide solutions to address entrenched disadvantage and some of society’s most intractable social problems” released an interim report last December. It identified three existing segments — social impact bonds which provide start-up funds for potential future return; the approximately 20,000 social enterprises of small to medium size with less than $10m turnover; and large scale enterprises of which only about six have an annual turnover of more than $50m. The interim report flagged the need for an early stage foundation; a body to promote more “outcome-based” funding opportunities; and a wholesale fund similar to Big Society Capital in Britain. The latter, it said, was “critical” for growing the sector.
Big Society Capital, was set up in 2012 as a £400m ($727m) fund to support and co-invest with fund managers to invest in social enterprises. It has since signed £540m of investment and attracted more than £1.2bn of coinvestments.
In an interview with The Deal, Traill emphasises that if the market is to scale up, Australia will need impact investment “wholesalers” to operate as intermediaries in the same way as fund managers operate in investment generally. Such a body would also attract people who could “talk a tripartite language” of business, social performance and community, and government. “A lot of the impacting investing space — think social housing, think aged care, early learning, NDIS — has an element of understanding of government policy funding and engagement,” Traill says.
“It becomes a virtuous circle. If you can set up funds that have $40m to $50m in them rather than $5m to $10m, by definition it is easier to hire (top talent).”
The task force found that high net worth funders, foundations and super funds which are already investing in social projects are often hungry for more products. They were saying “we would like to do more, we’ve been quite happy with the financial returns, the visibility of social impact, but we’d like to actually do three to five times the amount of what we are doing”.
“The question is then, how you develop more products?” Traill says. “We think that the answer is to set up the kind of partnerships that support the sustained development of intermediaries ethical fund managers who can originate these opportunities and transactions.” But he says the fragmented market will need support across all three segments from the earliest stage seed funding to mid-sized social enterprises to larger scale projects. This is needed in order to build skills for the bigger projects.
Traill left investment bank Macquarie 20 years ago to become founding chief executive of Social Ventures Australia. Back then the focus was on “venture philanthropy” and the use of performance metrics to bring venture capital disciplines to philanthropy without demanding a return on investment. “What has happened over the 20 years since is a much more sophisticated understanding that there will be opportunities to mobilise even bigger chunks of capital where you can combine reasonable financial returns and social purpose,” says Traill.
At present impact investing totals about $1bn in Australia but Traill suggests it could grow to 2 per cent of the overall local investment market of about $3 trillion. “I don’t think that’s a naive or aspirational target... 2 per cent is still mobilising massive pools of money. It could be a $60bn market. But to get to that point you would want it to be recognised as a mainstream asset class in the same way as private equity or infrastructure or direct property.”
Traill says super funds are interested in investments of $20m to $50m and above. That means they need projects of between $50m to $100m and above. “That is actually a big chunk of the market when you think about aged care, you think about TAFE and further education, early learning childcare, social and affordable housing,” he says. “The NDIS housing (for example) has been effective in encouraging funding into that market. These are clearly multibillion-dollar chunks of the economy.
“Wind the clock forward five or 10 years and I think there will be a very broad church of impact investors. The super funds have to provide reasonable long-dated financial returns and I think there is a transaction opportunity there that will appeal to them. “I think that will be a big market and then you’ll have a spectrum of impact investment that draws on the original pool of foundations, philanthropists and investors who want to generate a return but may be prepared to accept a ‘below conventional risk return’. And that’s already happening.”
The British system was boosted by using “unclaimed monies” and Sir Ronald Cohen, the force behind its establishment, has suggested Australia make similar use of so-called passive funds. But Traill says there are legislative and technical problems in “liberating” these funds in Australia, and the task force has not recommended that idea. Nor is it pushing legislative change to help Australia scale up the sector.
“We think it is much more about government encouragement and enabling,” says Traill. He says the final report addresses two other issues that have held back development of the sector — the need for capacity building for early stage social entrepreneurs who need resources; and “a very specific gap which we came to know as the valley of debt funding”. This refers to the problems faced by a social enterprise which is up and running but is too small to access the next tranche of capital — often between $25,000 to $150,000 — to allow it to grow to the next level.
Full article via The Australian
HELEN TRINCA, THE DEAL EDITOR AND ASSOCIATE EDITOR Helen Trinca is a highly experienced reporter, commentator and editor with a special interest in workplace and broad cultural issues.
The 2026–27 Federal Budget delivered the largest savings package on record ($63.8 billion) alongside a major tax reform package. We have completed an initial review of what this means for For Purpose Investment Partners and the sectors where we invest.
Our overall view - this is a net positive Budget. Our existing portfolio is well positioned. Our pipeline benefits from record housing investment and supply-side reform. The reform agenda creates clear openings for advocacy on issues that matter to our investors and our sectors, and ultimately the people we are creating impact for.
Implications for our portfolio
•Aged care — positive. New capital subsidies of $30 per supported resident per day for newly built homes (payable up to 25 years) directly improve returns on greenfield and expansion stock. A further $1.1 billion sits in Contingency Reserve to implement recommendations from the Aged Care Accommodation Pricing Review.
•Specialist Disability Accommodation (SDA) — neutral. The 160,000 participant reduction is targeted at lower-support-needs cohorts redirected to Thriving Kids and Foundational Supports. Our SDA assets focus on the highest-needs cohorts and are not expected to be materially affected.
•Disability services — mixed. National Disability Insurance Scheme (NDIS) reform is expected to reduce the number of participants by 160,000 to deliver $37.8 billion in savings, and we expect modest near-term volume risk for service providers during the transition. Mandatory registration of high-risk providers and continuation of the Fraud Fusion Taskforce favour quality, registered, scaled operators, providing a structural tailwind for our investment thesis over time.
•Skills education — neutral. No material new measures affecting current operations.
Implications for our pipeline
•Social and affordable housing — positive. Housing investment lifts to a record $47 billion. The negative gearing and capital gains tax (CGT) reform package redirects investor demand from established property to new builds. Build-to-rent developments and private capital supporting government housing programs are explicitly exempt. The new $2 billion Local Infrastructure Fund supports unlocking new supply.
•Broader disability services — positive structural tilt. The same registered-provider and integrity reforms favour quality scaled operators, directly aligned with the FPIP thesis. The $7 billion Foundational Supports and Thriving Kids programs open new state-delivered markets outside the NDIS.
•Early childhood education and care — neutral with marginal upside. Thriving Kids in early childhood settings ($139.7 million over 5 years) may open adjacent revenue stream. The Inclusion Support top-up ($54.8 million in 2026–27) adds modest margin for services supporting children with additional needs. Government funding for the Worker Retention Payment expires on 30 November 2026, with no clarity provided in the budget on whether that will be extended. This could leave a cost gap for providers to manage.
Our advocacy focus going forward
The Budget opens several areas where we will engage constructively with government and industry on behalf of our portfolio and the sectors we invest in.
•Super performance test design. Engaging with the public consultation to support a test that enables industry-fund allocation to productive social infrastructure.
•Aged Care Accommodation Pricing Review. Engaging on the final settings for the Accommodation Supplement uplift and capital subsidies currently held in Contingency Reserve.
•NDIS reform implementation. Supporting smooth transition for participants and providers ahead of the January 2028 eligibility changes, and engagement on Foundational Supports and Thriving Kids design.
•Affordable housing co-investment frameworks. Building on the build-to-rent and government housing program carve-outs to support institutional capital flows into social infrastructure.
For Purpose Aged Care Australia (FPACA) has acquired a new 89-bed residential aged care home in Wallan, Victoria. The home, which is newly built and currently unoccupied, will open to residents in early September 2026.
Wallan sits within one of Victoria’s fastest-growing regions. The acquisition brings 89 high-quality residential aged care places into service in the corridor and will create local aged care jobs through FPACA’s recruitment in the months ahead. It will be the first residential aged care home located in the town of Wallan.
FPACA will use the four months between exchange and opening to complete commissioning, recruit and induct staff, establish clinical governance, and engage with the local community so that the home is ready to deliver care from day one.
“This is a high-quality home in a growing community, and our focus now is on getting it ready to deliver the standard of care that residents and families deserve,” said Matthew Filocamo, Group CEO of For Purpose Aged Care Australia. “Aged care is at its best when it keeps people connected to their families and their community. Over the next four months we will be recruiting locally, engaging with the Wallan community, and making sure that on opening day this home reflects FPACA’s values and model of care.”
Demand for residential aged care in Australia continues to rise as the population ages. KPMG’s 2025 Aged Care Market Analysis reports that the number of people in residential aged care grew to 196,848 at 30 June 2024, with occupancy lifting to 88% as supply tightens.
The Wallan acquisition is the latest step in FPACA’s growth strategy, established by For Purpose Investment Partners (FPIP), the social impact investment manager behind FPACA. New bed development across the sector has slowed in recent years, and acquisitions of this kind play an important role in expanding quality capacity for older Australians.
“This is exactly the outcome the sector needs more of: a high-quality, purpose-built home coming into service for older Australians who need it, backed by an operator with the capability to run it well for the long term,” said Victoria Adams, Managing Director of For Purpose Investment Partners. “New beds are hard to bring into the Australian aged care system, and we are proud to be playing our part. Wallan is a clear example of what happens when patient capital and a strong operator come together with a shared social mission. 89 older Australians and their families will benefit, and the community gains a permanent piece of care infrastructure.”
About For Purpose Aged Care Australia
For Purpose Aged Care Australia is a national aged care provider with a clear social mission: to deliver high-quality care while creating meaningful social impact. Backed by ethical investors, FPACA reinvests in its people, places, and programs to ensure older Australians receive the respect and support they deserve. The organisation operates more than 2,150 residential aged care beds across Victoria, New South Wales, Queensland, and Western Australia, with a further 600 currently in development.
Spencer Ratliff will step down as Group CEO of Able Foods and Tender Loving Cuisine (TLC), effective from 5 June 2026.
Spencer co-founded Able Foods in 2020 with a clear purpose: provide access to safe and healthy food, reduce food insecurity, and promote greater independence and choice and control around meal times for National Disability Insurance Scheme (NDIS) participants and older Australians. Under his leadership, Able Foods built a reputation for quality, inclusion, and social impact, becoming a certified B Corporation.
Following FPIP's acquisition of Able Foods in 2022, Spencer led the business through a period of growth and product expansion. In 2024, his remit extended to Tender Loving Cuisine (TLC) as Group CEO across the FP Ability platform.
Rob Blackwell, Executive Chair of FP Ability, will assume the role of Interim Group CEO while a search for Spencer's successor is conducted. Rob will work closely with the leadership teams at both Able Foods and TLC to ensure continuity for customers, staff, and partners through the transition.
Quote from Rob Blackwell, Executive Chair, FP Ability
“Spencer's contribution to Able Foods and TLC has been significant. He co-founded a business with purpose at its core, and he has built something the sector genuinely values. We are grateful for his leadership and for the teams he has shaped. As Interim Group CEO, my focus will be on supporting both businesses through a seamless transition while we identify the right long-term leader to take them forward. We wish Spencer every success in what comes next.”
Quote from Spencer Ratliff
"Co-founding Able Foods and leading both Able Foods and Tender Loving Cuisine has been one of the most fulfilling chapters of my career. Knowing that the work we do genuinely improves quality of life for some of Australia's most vulnerable people made every moment of it worth it. With both businesses well-positioned and strong leadership teams in place, this feels like the right moment to step back. I'm grateful to the teams, our customers, and FPIP for their trust and support."
For Purpose Investment Partners acknowledges and pays respect to the past and present Traditional Custodians and Elders of this nation and the continuation of cultural, spiritual and educational practices of Aboriginal and Torres Strait Islander people.
We believe that diversity, equity and inclusion at For Purpose Investment Partners are critical in our efforts to create significant social impact. Diversity in the team allows us to better represent the diversity of thought and experiences of the communities that we are aiming to serve, promotes a healthy and thriving working environment, and delivers innovative and sustainable outcomes for our communities, our people, our investors and our partners.
