POLICE have authorised a $1 million reward for information that convicts the killer of 12-year-old Terry Floyd, who is believed to have been abducted from the side of a road at Avoca in 1975.

Terry's ever-constant champion, his younger brother Daryl Floyd, says it is a glimmer of hope after almost 40 long years.

Mr Floyd lobbied for police to fix the disparity in reward amounts between cold cases and has become an advocate for families of missing persons.

"I've been told I'm obsessed and my response is, 'No shit, Sherlock'. This is about my brother," Mr Floyd said.

"A million dollars is a life-changing amount. People out there do have bits of information that now they may be able to come forward with."

The reward for information in the case comes as cold case investigators reveal convicted paedophile Raymond Kenneth Jones remains a person of interest and as Fairfax Media traced Terry's last known movements almost 40 years ago in new detail.

On June 28, at 4.45pm, Terry left the Avoca post office where he was playing Monopoly with a friend. He was running 15 minutes late for his ride home.

"That 15 minutes cost him his life," Mr Floyd said.

Three witnesses, all locals, saw a fawn-coloured panel van that afternoon. One saw the van stopping in front of Terry as he waited on the coroner of Birdport and Barnett streets; another saw the van on the side of the Pyrenees Highway out of town with Terry standing at the back of it.

A third witness, a nurse driving home from work along the highway, saw the van turning into Box Flat Track, the road that leads to a mine shaft where Mr Floyd believes his brother's body was dumped.

Jones, who was on bail for indecently assaulting a boy in a Ballarat toilet block at the time, owned a fawn-coloured panel van and has admitted being on the same highway, travelling from Avoca to Maryborough, at the time.

Jones, who is believed to be living in northern Victoria, has previously denied any involvement in the disappearance.

Cold case unit Detective Senior Sergeant Boris Buick said Jones remained a person of interest. He said he was one of a number of people who have been nominated as suspects.

"He has been nominated and has been looked at early in the piece and can't be eliminated and there's not sufficient evidence to charge him," Senior Sergeant Buick said.

An Avoca farmer who maintained Jones was involved was a man by the name of Buster Allen, who was related to a close friend of Jones.

Mr Allen has since died, but a relative who spoke to Fairfax Media said Mr Allen told him the day Terry disappeared, Jones was missing "for hours and hours" from a party he was supposed to attend.

"Buster said he was up to no good and old Buster wasn't the type of bloke to spread rumours around," the relative said.

Last December, police announced all murder rewards previously posted would be reviewed and increased to $1 million when those reviews were completed.

Senior Sergeant Buick said the new reward could prompt people who know what happened to Terry to come forward.

"There will be people in the twilight of their years that will have information they've been holding onto for decades ... we're hoping they'll come forward," he said.

"It's a 12-year-old boy who was abducted and murdered and it's a horrific crime."

Anyone with information can phone Crime Stoppers anonymously on 1800 333 000 or submit a confidential crime report on www.crimestoppersvic.com.au.

- The Age