Industry Support and Recovery Minister Martin Pakula rejected the Business Support Fund had failed to support small businesses during the COVID-19 pandemic.

He said the Department of Jobs, Precincts and Regions-administered scheme had offered 130,000-plus grants of up to $10,000 to businesses across Victoria.

"My department made 52 years' worth of grants in one year and so it's not unreasonable that there be a few errors in that," Mr Pakula told reporters on Wednesday.

"There is in excess of $2.6 billion worth of support that was paid to business through the three rounds of the Business Support Fund.

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"When you look at the support that's been paid to business by the Victorian government compared to every other government in the country, it really is no comparison."

In her report into the program, Victorian Ombudsman Deborah Glass found applications were denied because - unaware to many - they remained in draft form awaiting further information.

Others weren't processed because forms contained typographical or numerical errors, involving email addresses or other information.

"The department made mistakes. People made mistakes," Ms Glass said.

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"Mistakes were, in the fraught circumstances of the pandemic, completely understandable. But the consequences of people's mistakes could be devastating."

The department has now agreed to invite up to 12,000 eligible business owners who were denied the $10,000 grant to reapply. If all were granted, it would cost the state government an extra $120 million.

Acting Premier James Merlino on Tuesday said the businesses would be contacted over the "next few days", but Mr Pakula could not offer a firm commitment for when all fresh applications would be processed.

"We're not going to put an arbitrary timeline on how long it will take," he said.

"It'll take as long as it takes. We're not going to waste any time doing it."

Ms Glass found the system was set up in just nine days and lacked a robust complaint or internal review process.

Just five staff were initially fielding calls about the program and when that figure expanded to 500, outsourced workers were unable to help struggling business owners as they were not granted access to their case files.

Australian Associated Press

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