Premier’s plight put to Shark Tank test
A TOP Queensland tech kingpin has branded the perception of a government fund investing in a company linked to Premier Annastacia Palaszczuk's chief-of-staff as "horrible" and a threat to the state's technology industry.
Former Shark Tank judge Steve Baxter said he had grave fears that such conflict-of-interest scandals could spook governments out of investing in startup ideas.
Mr Baxter, who was formerly the government's chief entrepreneur, has called for the matter to be quickly resolved before "the drama gets too large" and "the baby gets thrown out with the bathwater".
Ms Palaszczuk has been under pressure since it was revealed her chief-of-staff David Barbagallo was an investor and director of a company that received a $267,500 investment from the Government's $80 million Advance Queensland Business Development Fund.
The company, Fortress Capstone, is developing a smartphone app called CruiseTraka that will allow people on cruises to post their location to family and friends.
Ms Palaszczuk has said Mr Barbagallo declared his interest as required and withdrew his involvement in the application process when he joined her office in 2017.
The decision to invest in Fortress Capstone was also made by an independent board of industry experts.
The Premier has tasked the Department of Premier and Cabinet to conduct an audit of the decision, with the work outsourced to consultants Ernst and Young.
The department last night released the terms of reference for Ernst & Young's internal audit, with an August 30 deadline to report back.
Mr Baxter, who is also an investor in CruiseTraka, said there were clear perception problems with Mr Barbagallo's involvement.
"Definitely the perception is horrible... to be honest," Mr Baxter said.
"And I am very close to CruiseTraka, as you know… I am an investor, I have done two investment rounds and I was on the board with David Barbagallo."
Mr Baxter said he feared such controversies would convince government to withdraw from helping the Sunshine State's tech industry.
"I fear that if the drama gets too large and people don't understand the good it is doing, then it will scare governments away and throw the baby out with the bathwater," he said.
Mr Baxter said while such development funds needed a shelf life, technology shaped an important future pillar of the Queensland economy alongside mining, tourism, construction and agriculture.
"If we are happy to only have those (industries) in five or 10 years then we shouldn't do this," he said.
"But if we want something extra, we should do things like this for a set period of time."
As part of the internal audit, Ernst & Young will review the assessment and approval of the funding granted to Fortress Capstone, including the funding application, how it was assessed and approved, as well as how any potential conflicts of interest are managed.
It will also assess compliance with the ministerial handbook as well as laws governing ministerial office staff.