The Allan Labor Government’s trouble-plagued venture capital firm, Breakthrough Victoria, is in crisis. After a string of board resignations and failed investments, the fund’s CEO has quit after only two years in the role.
Highly touted by Labor, the $2 billion fund has been shrouded in secrecy. Labor’s Treasurer Tim Pallas is the fund’s only shareholder, and the inaugural Chair is former Labor Premier John Brumby.
The Labor Government promised the fund would create over 15,000 local jobs and deliver an eight per cent return to Victorian taxpayers.
However, the fund has failed miserably, with only 1,800 jobs created and the Government refusing to disclose if any of its investments will return a profit to taxpayers. In this year’s budget, the Labor Government said it was cutting $360 million from the fund as a ‘saving initiative’, also conceding the full $2 billion would be spent over 15 years, rather than 10.
Serious concerns have been raised about many of the risky and irresponsible investments made by Breakthrough Victoria, including $34 million invested in a medical start-up that went through a funding crisis resulting in mass job losses.
The current chaos inside Breakthrough Victoria cannot continue. The CEO’s exit is a clear signal that Breakthrough Victoria is breaking apart and is unable to cope under the pressures of its failed investments.
Shadow Minister for Innovation, Bridget Vallence, said: “Breakthrough Victoria is in turmoil and given the many board resignations in recent months and the CEO walking out the door, it’s clear there is no confidence in the leadership of current Chair and former Labor Premier, John Brumby.
“It’s time for Mr Brumby to resign.
“The Victorian Liberals and ³Ô¹ÏÍøÕ¾s are calling for the Auditor-General to be brought in and undertake a root and branch review of Breakthrough Victoria to assess whether the fund is viable. With $2 billion of Victorian taxpayers’ money on the line, Victorians cannot afford more financial disasters.”
