A taxpayer-funded company that will cost Territorians an estimated $200,000 a month to operate this year has been criticised for being structured to avoid public scrutiny and failing to meet its mandate.

Key points: The $200 million Northern Territory Infrastructure Development Fund ran a $1.4 million deficit last year

The $200 million Northern Territory Infrastructure Development Fund ran a $1.4 million deficit last year It was intended to fund major projects in the NT and deliver jobs into the future

It was intended to fund major projects in the NT and deliver jobs into the future In two years it has identified one investment, classified as "high-risk"

Company financial documents show the $200 million Northern Territory Infrastructure Development Fund ran a $1.4 million deficit last financial year, made up of hundreds of thousands paid to board members and more than $500,000 in management fees to oversee the fund that did not identify a single investment.

The IDF was established in 2016 by the CLP government, with $200 million of taxpayer funds from the sale of TIO.

It was intended to fund major infrastructure projects for the Territory, raise an additional $800 million in private capital for future investments and deliver "jobs and prosperity for years to come".

But in more than two years since its inception, the fund has only invested in one business which an investment analysis categorised as "high risk".

The IDF has also been unable to attract any private capital.

Financial records released by the IDF showed four board members were paid a total of $340,000 to attend six meetings last financial year, as well as $20,000 for travel and $76,000 for "consultancy fees".

It did not identify what all the fees were for, or how much each board member was paid.

The biggest expense was more than $560,000 in management fees to private equity firm Infrastructure Capital Group to oversee the fund for seven months.

That total will be $1 million this financial year.

Transparency needed on fund costs, says MLA

Independent MLA Robyn Lambley told ABC Radio that paying $1 million to a company to oversee a fund that did not contribute anything to the Territory was a "waste of money".

"The cost of managing this fund is ridiculous," she said.

"We need some transparency around what the costs are… and whether or not it's worth continuing."

She said if the management fees were that high, the fund would not be sustainable, particularly if it wasn't investing in other projects as it was supposed to.

Robyn Lambley said the cost of managing the fund was ridiculous. ( ABC News: Ian Redfearn )

Infrastructure Capital Group was appointed to manage the fund by the IDF board in 2016.

According to ASIC records, IDF chair Les Fallick was listed as a director and shareholder with the company two and a half years earlier.

ASIC records show Mr Fallick ceased to be a director in December 2013.

Additional shareholder documents obtained by the ABC reveal he sold his shares to former business partner and founding ICG director John Clarke, and to a company owned by ICG major shareholder and director Mike Fitzpatrick.

ICG was selected from six finalists to manage the NT IDF by the board in April 2016.

Mr Fallick declined numerous interview requests, but said in an email that he declared his past relationship with the company to the IDF board and did not participate in the selection process.

"I excused myself from that process, given my prior involvement with ICG," Mr Fallick said.

"The decision not to participate in the investment manager appointment decision, and the reason for this, was formally noted at the time."

The board of the taxpayer-funded IDF would not produce the minutes of the April 2016 meeting and would also not say exactly who on the board voted to hire ICG over the other management companies.

Based on its corporate structure, the IDF acts like a private entity and does not have to disclose information in the same way as a public entity.

This type of secrecy from a taxpayer-funded company raises transparency issues, but is permitted because the previous government structured it without special conditions, Ross Grantham, Professor of Commercial Law at the University of Queensland said.

"There are public funds involved and… arguably there ought to be public accountability with respect to those funds," he said.

"[However], once you've made the decision to use a private sector vehicle, then the private sector accountability rules follow.

"Without special rules in place to provide for public sector accountability, only those private sector reporting rules apply. Those are not as transparent as the public sector."

Only investment was 'high-risk'

The Infrastructure Development Fund announced their first investment in March of this year, injecting an estimated $10 million into local water bottler NT Beverages to expand their water bottling plant at East Arm.

That $10 million is a straight investment, meaning taxpayers are on the hook for the cash if the company fails.

ICG have declined to divulge the particulars of the deal — including all the costs — citing confidentiality.

Investing in "opportunistic" endeavours such as a private water bottling company is categorised as "high-risk", according to the IDF's founding document prepared by Mr Fallick's investment firm, Granite Capital, in July 2015.

Ms Lambley said besides being risky, the bottling investment was not in keeping with the fund's mandate to invest in infrastructure for the Territory.

"It's time for the Treasurer to step in and scrutinise this whole fund from top to bottom," she said.

"It's not functioning the way it was meant to function. It has failed to do so.

"We need to understand why and why the Treasurer is allowing this huge amount of money to go to the payment of ICG to manage the fund and the board to travel and pay their expenses with no delivery to the people of the Northern Territory."

Treasurer says 'hard questions' were asked of board

Treasurer Nicole Manison said she had considered re-evaluating the IDF after two years, but did not commit to scrapping it just yet.

She said new projects were in the works, albeit slower than she would have liked.

"I want to get the best value for money for Territorians and certainly if we are not satisfied that the fund is working in the best interests of the Northern Territory, we will move to close that fund," she said.

"But there are several projects close to final investment decisions. We don't want to compromise some of those projects getting off the ground."

She added that she had asked "hard questions" of the board and would look into making the board's spending more transparent.

"I will continue my discussions with the NT IDF about ways in which we can make it more transparent, particularly given that this is Territory taxpayers funds," she said.

ICG did not respond to a request for comment.

The IDF board consists of Mr Fallick, head NT public servant Jodie Ryan, Paspaley Pearls CEO James Paspaley, former Macquarie Bank boss Bill Moss and former Future Fund managing director Mark Burgess.