LNP looks at revamp of Qld investment flagship

Is the new LNP Government preparing a revamp of the Queensland Investment Corporation (QIC) given some of the $100bn fund’s missteps in recent years?

Queensland Investment Corporation under the spotlight.

Is the new LNP Government preparing a revamp of the $100bn Queensland Investment Corporation (QIC)?

City Beat spies tell us the Crisafulli administration is weighing up the value of QIC’s value to taxpayers and is considering a number of reforms to the Queensland investment flagship.

We hear board and legislative changes, or a potential merger with the Queensland Treasury Corporation (QTC) are all under consideration.

While he was in Opposition, now Premier David Crisafulli was hardly a fan of the investment powerhouse, tweeting in 2020 that “while many Queenslanders lost their jobs this year, the Queensland Investment Corporation paid $58 million in bonuses to employees which is more than what was returned in dividends.”

QIC paid performance and retention payments in excess of $91m last financial year to its 878 staff, more than the $88m dividend back to the Queensland Government.

There have been some high-profile missteps by QIC in recent years, including damage from losses in real estate, loans to Credit Suisse plus a now worthless equity stake in troubled Thames Water. One option is a merger of QIC and QTC to bring the government-owned corporations’ operations closer to the Queensland Government and reduce inefficiencies.

A similar move was taken by the NSW Government when it merged the asset management and liability management organisations of NSW TCorp in 2015. Spies tell us another potential action under consideration is the closure of the QIC-operated Qld Debt Retirement Fund.

Thames Water investment by QIC now worthless.

The fund, with over $8bn of assets, was launched in 2021 in a low interest rate environment but its usefulness is now being questioned given the government’s rapidly rising debt levels and rising interest rates. The new government is also questioning the large expenses associated with QIC’s global offices in London, New York, Copenhagen, San Francisco and the new Singapore office opened in late 2023.

The LNP government has already made a number of changes to the government finance sector since coming into power in October, including the departure of high profile Queensland Treasury Corporation boss Leon Allen who leaves in the coming weeks.

QIC had been hoping to raise new funds in its infrastructure and private credit operations from Korean clients this year in an effort to offset the continued redemptions from Australian clients in its real estate business.

The falls in real estate assets are now upwards of $8bn over the past 5 years.

Treasurer David Janetzki’s office, which would oversee the revamp, this week declined to comment. A QIC spokesperson told your diarist: “QIC has delivered for successive governments over 34 years, with $8.9 billion generated for Queensland government clients last financial year and returns tracking strongly for 2024-25.”

But as City Beat reported before the state election, the LNP wanted to take a good look under the QIC hood if it gained power.

Generous bonuses paid to staff at QIC earlier this year were again under the spotlight last year given the average Queenslander is struggling amid the cost of living crisis.

Just under $10 million in total remuneration was paid to key management personnel including four senior executives and nine board directors.

This figure - an increase of over $1 million, or 12 per cent over the year — included base salary, superannuation, leave accruals and performance payment bonuses.

QIC’s senior executive team includes chief executive Kylie Rampa (illustrated), chief financial officer Claire Blake, chief risk officer Sam O’Sulllivan and executive director Ravi Sriskandarajah.

Originally published as LNP looks at revamp of Qld investment flagship