One local government watchdog has had its powers expanded to sink its teeth into bigger issues and dole out stronger penalties.

Victoria's Local Government Inspectorate (LGI) can now examine serious misconduct by councillors with the addition of two new offences.

The new rules and punishments relate to breach of confidentiality and improper direction of council staff.

“These new and stronger powers for the Inspectorate send a clear message to current and future councillors that they must be beyond reproach when representing their communities,” said Victorian Minister for Local Government, Jeanette Powell.

The changes afford the LGI an expanded role to investigate serious misconduct by a councillor, and the power to initiate prosecutions for serious and gross misconduct.

Mrs Powell said the Inspectorate will be able to prosecute cases of improper direction by a councillor to a member of council staff, and lay punishments for the release of confidential information by a councillor.

Reports say both the new offences will carry 120-unit penalties; charges of about $17,323.

It is expected that the changes will be put before state parliament within six months.

The Local Government Minister said it was part of Victoria-wide new legislation; the Local Government Amendment (Performance Reporting and Accountability) Bill 2013. The Bill will come into effect on April 18 2014, and is expected to provide a new level of transparency and accountability across the state’s Local Governments.

“Once the reforms are fully implemented, residents and ratepayers will be able to see online how their council is performing and this will help drive improvements across the Local Government sector,” Ms Powell said.