Bendigo was chosen as the home of the authority given the city’s proximity to horticultural, food and meat processing centres which use large amounts of labour hire workers.

The authority will be set up using $8.5 million from the 2018/19 Victorian Budget, and will ensure compliance under the state’s new labour hire laws.

These include a requirement for providers of labour hire services to be licensed. They have six months to have a licence or have an application pending.

The authority will maintain a register of licenses and carry out investigations on businesses. It will be co-located with existing department units in Bendigo until the Gov Hub is complete.

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About 20 jobs will be created in Bendigo.

Member for Bendigo West Maree Edwards said it was the first step on the way to establishing the Gov Hub.

She said co-location would be required while the planning stage took place.

“We’re boosting jobs in Bendigo and cementing our position as an important regional government hub,” she said.

The state government provided $16 million of the required $90 million to the Gov Hub project in this year’s budget.

The project involves locating all City of Greater Bendigo functions and government agencies in one location on Lyttleton Terrace. It is proposed to host 1000 workers and will replace the current council offices.

The council is lobbying to have a major state government agency relocate to Bendigo as part of the project.

Last week, Nationals leader Peter Walsh questioned the need to have Regional Development Victoria based in an office building on Exhibition Street in Melbourne’s CBD.

City of Greater Bendigo chief executive officer Craig Niemann said having the labour hire agency based in Bendigo was a welcome announcement.

“The city is pleased the state government is investing in jobs in regional Victoria, especially in Bendigo,” he said.