Funds projected to manage $13.9 trillion in fiduciary capital by 2040
Canada's largest pension funds and Australia's biggest superannuation funds have signed a memorandum of understanding, according to a May 2026 Dentons report.
The deal could unlock $10bn in new Canadian infrastructure investment over the next decade.
IFM Investors brokered the Canadian-Australian Pension Funds Investment Initiative, the report said.
All members of the Maple 8, including AIMCo, BCI, La Caisse, CPP Investments, HOOPP, IMCO, OMERS, OTPP, and PSP Investments, signed alongside Australia's largest superannuation funds.
Together, the two systems are projected to manage $13.9tn in fiduciary capital by 2040.
The MoU was announced during prime minister Mark Carney's diplomatic visit to Australia on March 3, and focuses on airports and road infrastructure as priority targets, with a core function of advocating for policy reforms that reduce investment barriers in both jurisdictions.
The biggest structural obstacle, according to Dentons, is the scarcity of investable assets.
Canada's most strategically significant infrastructure, including ports, utilities, railways, airports, and highways, remains under public ownership and is not available for sale or long-term lease.
Most Canadian PPPs have also been too small to attract major pension funds, which typically seek equity commitments in the range of hundreds of millions to billions of dollars.
Recent federal policy moves have begun to address this.
The 2026 Spring Economic Update introduced the "Canada Strong Fund," described as Canada's first national sovereign wealth fund, with an initial size of $25bn.
The federal government is reportedly considering airport privatisation to generate revenue for the fund.
Transport minister Steven MacKinnon confirmed the government is in the "early stages" of discussions on whether Canada's airports will be privatised.
Budget 2025 was the first federal budget to contemplate airport privatisation explicitly, and pension fund managers have identified airport investments as among the most commercially attractive available, given the potential for non-aeronautical revenue growth.
Regulatory fragmentation compounds the supply problem.
More than 20 federal departments and agencies are involved in infrastructure financing, and Canada has no unified investment regime or consistent national framework for private participation.
The Investment Canada Act adds further complexity, with recent amendments including a revised Sensitive Technology List published in February 2025 increasing the compliance burden on foreign institutional capital.
The explicit incorporation of "economic security" as a national security consideration gives the federal government broad discretionary authority to review or restrict investments.
Tax barriers remain a parallel concern.
Canadian and Australian pension funds are lobbying to amend the 1980 Canada-Australia Tax Treaty, seeking lower Managed Investment Trust withholding rates and protection against a wider capital gains tax base.
The report warned that Australia's proposed expansion of foreign resident capital gains taxation, including broader taxable property scope and enhanced tracing rules, could increase tax exposure and undermine those efforts.
The bilateral relationship also extends into Australian debt capital markets, where Canadian pension funds operate as both issuers of kangaroo bonds and investors in Australian fixed-income securities.
In 2025, the average size of Canadian kangaroo bond transactions reached AU$799m, and kangaroo bonds contributed AU$62.4bn, or 27 percent of Australia's new issuance that year.
Public trust represents the central challenge for the initiative's domestic ambitions.
The Dentons report notes that opposition to infrastructure privatisation in Canada reflects widespread public concern about service quality, user affordability and democratic accountability.
The 407 ETR transaction continues to serve as a reference point in public discourse, and the report flags concerns from public sector unions that workers' pension capital may fund changes to employment conditions in services those workers provide.
Australian precedent cuts both ways on infrastructure privatisation, with superannuation's major role enabled by a mid-1980s trade union compact, while a 2015 survey and Queensland electoral results showed the political risks of proceeding without public confidence.
Dentons concludes that scaling the initiative requires two conditions: investable assets of sufficient size and viability, and a stakeholder engagement framework that builds and sustains public confidence in changed ownership structures.
