Queensland taxpayers should know within two months if they’re the proud part-owners of Australia’s second airline amid a global aviation crisis.

The state government is looking to join a consortium of investors to rescue Virgin Australia and it’s willing to tip in at least $200 million to keep the airline flying.

Coalition MPs have ridiculed the idea, with Home Affairs Minister Peter Dutton slamming it as an election stunt.

Mr Dutton said the state government’s plan to rescue Australia’s second carrier, after the federal government refused to bail it out, was “laughable”.

He accused the Labor government of making a “phoney” bid to look patriotic ahead of Queensland’s October election.

It was crazy for Premier Annastacia Palaszczuk to even contemplate buying Virgin, Mr Dutton said. The airline owes almost $7 billion and is paralysed by the coronavirus crisis.

“Every credit card she has is already maxed out,” he told 2GB on Thursday.

“If the Queensland government bought this airline, the thing would be back on the market in six months.

“They can’t run a train system. It’s just fanciful and I think it’s dangerous.”

Mr Dutton’s federal cabinet colleague, Agriculture Minister David Littleproud went further, labelling the idea a “populist brain-fart”.

The Queensland Investment Corporation will advise the government on its bid, which could take the form of a direct equity stake, a loan, guarantee or another financial tool.

The Queensland government isn’t seeking outright ownership of the carrier, which went into voluntary administration last month.

But it does want skin in the game in the form of a strategic stake to ensure the restructured airline keeps workers in their jobs, its headquarters in Queensland, and planes on regional routes.

Aviation analyst Jordan Chong said the idea had some merits.

“One shouldn’t be immediately dismissive of a government owning an airline,” he told the ABC.

“States want economic activity and states want jobs, and at this time, they’re all very precious. So Queensland has just come out and said what they’re intending to do.”

State Treasurer Cameron Dick said Queensland was a serious contender to take over Virgin. It has set aside $200 million – previously offered as part of a bailout for the airline – in a plan branded “project maroon”.

“We need to strike a hard bargain. I want those foreign banks and those foreign bond holders to take a haircut,” Mr Dick told ABC radio.

“They’ve got to take a bath if we’re going to go forward on this,” he said, pointing to Virgin’s role as a major employer.

“How can we afford not to save 5000 jobs?”

Tweet from @PeterDutton_MP

Earlier, Mr Dutton said it was laughable to consider using taxpayers’ money to buy an airline at such a time.

“Premier Palaszczuk has almost bankrupted Queensland, and now in the middle of a crisis they want to buy an airline,” tweeted the federal MP, who holds the Brisbane seat of Dixon.

“It is laughable. She ‘leads’ a government which is corrupt and chaotic.”

Mr Dick fired back, telling Mr Dutton to “just stick to cruise ships” – a reference to the botched arrival of the coronavirus-ridden Ruby Princess in Sydney.

Look mate, just stick to cruise ships … https://t.co/Cb4AArVokL

— Cameron Dick (@camerondickqld) May 13, 2020

• Who will buy Virgin? These are the frontrunners

On Thursday, Deputy Prime Minister and Transport Minister Michael McCormack joined in the criticism, saying a market-based solution would be best for Virgin Australia.

“They (the state government) should stick to trying to run Queensland and Queensland’s economy,” he said.

“I think this should be left to companies, to potential bidders and … investors who aren’t necessarily government.”

But Mr Dick said it would be irresponsible for the state government not to have a crack at saving the nation’s second airline, which employs thousands and is headquartered in Brisbane.

“Regional Queensland was crushed when Ansett went under,” he said.

“There is a lot of interest in Virgin Australia. Some of them aren’t necessarily going to put Queensland interests first.”

Queensland Investment Corporation chief executive Damien Frawley said Virgin Australia’s restructure was a significant opportunity for the state.

“We are well-equipped to manage the state’s interest in Virgin Australia Holdings should the consortium be successful,” Mr Frawley said on Wednesday.

Final bids for Virgin are due on Friday. The airlines’ administrator, Deloitte, wants a sale concluded by June 30.

-with AAP