Cabinet Minister Stephen Conroy has defended the choice of outgoing Australian Stock Exchange Chairman David Gonski as new head of the Australian Future Fund. He made the statement in response to the push by other Australian Labor Party members for Peter Costello to head the $77-billion fund.

Mr Conroy pointed out that between Mr Gonski and Mr Costello, it was clear that the former has the advantage.

"I'd rather put my money under the control of David Gonski any day of the week ahead of Peter Costello," Mr Conroy was quoted by Nine's Today programme.

"Peter Costello seems to have a sense of entitlement that he should have been the prime minister so he used to stamp his feet behind John Howard and now he's doing it again," he added.

Mr Costello is a member of the fund's Board of Guardians appointed by Treasurer Wayne Swan who has oversight over the fund. Mr Gonski was named to head the fund by Prime Minister Julia Gillard, while Mr Swan announced the appointment on Wednesday.

However, backers of Mr Costello in ALP insisted that he is a good custodian of the economy.

"It is totally extraordinary that you've got the person who conceived of the Future Fund, who made provision for the Future Fund, who implemented the Future Fund; you could find no better person to chair the Future Fund. The board thought that. David Gonski thought that, and that's what he told the cabinet," former Costello staff Kellie O'Dwyer said.

Backing Mr Conroy, Finance Minister Penny Wong said that while Mr Costello has many good qualities, she pointed out that the Australian business community has not asked him to chair any listed companies or run a large financial institutions.

"Those are the sorts of competencies that we wanted to ensure the chair of the Future Fund has, and David Gonski has those," Ms Wong told ABC radio.

She added the cabinet did not recommend Mr Costello to the fund and the post is not filled up by the fund's board members but by the prime minister. If the board had its way, it would rather have former Finance Minister Lindsay Tanner replace outgoing Future Fund Chairman David Murray.

However, Mr Swan recommended Mr Gonski, stressed Ms Wong. The treasurer insisted the appointment of Mr Gonski has no political considerations since he had appointed Ms Tanner and Mr Costello to the board.

Mr Gonski will take over the position of Mr Murray on April 3 for five years. Besides being chair of the ASX, he also is chairman of Investec Bank, Coca-Cola Amatil and Ingeus, while serving as a director of Singapore Airlines. He will step down as ASX chair on June 30 and quit being director of the air carrier in July.

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