BENDIGO Health has welcomed the state government's announcement of almost $60 million for a new rehabilitation unit.

The chair of the health care group's board, Bob Cameron, said the funding would allow the work that started with the new hospital project to be completed.

"Our patients and staff will benefit from a new state-of-the-art centre, including a new hydrotherapy pool," Mr Cameron said.

"We thank the state government for their continued support in developing world class health facilities in Bendigo which help us provide excellent care."

The funding features in the 2019/20 Victorian budget, which will be released today.

EARLIER:

The East and north Wing towers at Bendigo Health are set for demolition, as construction begins on a new rehabilitation unit by 2021.

The proposed Bendigo Hospital Day Rehabilitation centre has received almost $60 million as part of the 2019/20 Victorian budget.

The two East and North Wing tower buildings on the site will be demolished as part of the project.

The state government promised funding for the project prior to the Victorian elections in November 2018.

Read more: Daniel Andrews promises to replace Bendigo Health towers with rehabilitation centre

The buildings on the Anne Caudle Campus house administration, public dental services and a hydrotherapy pool.

The new day rehabilitation centre will bring together the rehabilitation services spread across Bendigo Hospital. This will include physiotherapy, occupational therapy, social work, speech therapy, prosthetics and orthotics, clinical psychology and neuropsychology.

The centre will also house a new hydrotherapy pool.

The public dental services and training areas which occupied the towers will be moved to new accommodation.

Construction is due to begin by 2021, and be complete by 2023. The project is expected to create 180 construction jobs.

The towers - built in 1958 and 1972 - have not complied with the fire safety code since the standards were raised in 2012.

The site these towers occupy will become a green space for patients at the hospital and their families.

In 2016 then Bendigo Health chief executive John Mulder said the buildings were not dangerous, despite the fact they did not meet fire safety standards.

Read more: Two Bendigo Health buildings don't - and can't - meet fire safety standard

It would "cripple" acute services and affect elective surgery to close the building before the new hospital opened, which was due to open in January 2017, he said.

Mr Mulder said Bendigo Health had done a range of things to make sure they were as safe as possible.

The material the floors were made from meant the site could not fully comply with safety measures, he said.

Bendigo Health proposed the day rehabilitation centre several years ago.

The hospital approached the federal government and the Labor opposition asking for funds to demolish the two towers in 2016.

In 2017 a parliamentary inquiry committee into state infrastructure projects identified Bendigo Health's proposal to move its rehabilitation services.

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In March 2018, a hospital spokesperson told the Bendigo Advertiser that the process had begun to develop plans to move services from the two tower buildings into buildings on the old hospital site, which would allow demolition of the buildings.

A lack of funding to demolish the towers put the project on hold.

At the time then Minister for Health Jill Hennessy said future funding would be subject to budget considerations.

She said the priority had been a transition of patients and staff to the new Bendigo Hospital, before delivering stage two of the project.

The first stage of the Bendigo Hospital project was completed in early 2017. It included 372 inpatient beds, 72 same-day beds, 11 operating theatres, an integrated cancer centre, a maternity unit and a mental health unit.

The project was officially completed in June, 2018, when the helipad and carpark opened. These projects were part of the second stage of the hospital project.

There were no plans for a "stage 3" development, Ms Hennessy said at the time.

When Bendigo Hospital Project officially opened August 2018 the Bendigo Advertiser reported that it was unlikely the fate of the towers would be decided before the state election.

By then some services, such as inpatient rehabilitation, had been moved from the towers into the new hospital facility.

Premier Daniel Andrews then said every Victorian hospital was in a constant conversation with the government about its next stage of development.

Read more: Bendigo Health raises plans to offer more specialist services

But in October 2018 the state government promised to fund the $60 million for the new day rehabilitation centre.

Minister for Health Jenny Mikakos said the government was delivering its promise to bring Bendigo patients and clinicians a new rehabilitation centre.

"Patients have enough to worry about without needing to find where to go to access the services they need. Bringing them together under the one roof will make recovery that little bit easier," Ms Mikakos said.

Member for Bendio East Jacinta Allan said when it comes to recovering from injury or illness a proper rehabilitation plan was important.

"We're helping out hard-working rehabilitation clinicians give patients wold-class treatment so they can return to their lives," Ms Allan said.

Member for Bendigo West Maree Edwards said the rehabilitation centre meant patients would have seamless care when they recover from accidents, injuries and medical conditions like stroke or heart attack.

For full coverage of the state budget, visit: bendigoadvertiser.com.au.

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