Government ministers including Attorney-General Martin Pakula are under pressure to stand down after police opened a fresh investigation into the misuse of almost $400,000 in taxpayer funds before the 2014 election.

The explosive revelation on Friday that police would reopen the investigation into the "red shirts" rort just four months out from the November poll has rattled some Labor MPs who fear it could be fatal to their hopes of re-election.

Victoria's Ombudsman found hundreds of thousands of taxpayer dollars were used to pay for Labor campaigners called the "red shirts". Credit:Scott Barbour

Opposition Leader Matthew Guy leapt at the police announcement, saying it was untenable for the ministers involved in the rort to continue in their roles while police investigated the matter.

One Labor MP said the investigation would be a massive distraction from Labor's campaign if it was not resolved soon in the government's favour.