Homeless people could be effectively banned from sleeping rough in Melbourne after the city council voted to change a by-law to outlaw makeshift camps.

The council voted five to four in favour of the proposed amendments this evening, giving council officers and the police "more capacity to intervene" to clean up the camps dotted around the city.

There were cries of "shame" at the Town Hall meeting when the decision was reached, with the meeting moved to a larger space at Town Hall to cater for strong public interest.

Police clashed with rough sleepers last week as a large homeless camp outside Flinders Street Station was dismantled to make way for scaffolding to upgrade the station.

Victoria Police Commissioner Graham Ashton last month urged the council to amend the existing laws.

The council had previously said its intention is to ban camps, and not to ban homelessness.

What changes under the new policy?

The Activities Local Law 2009 already bans camping in the city: "Unless in accordance with a permit, a person must not camp in or on any public place".

But under the amendments, a description of what constitutes camping will be deleted: "… in a vehicle, tent, caravan or any type of temporary or provisional form of accommodation".

Homeless advocates and legal experts say the wording was so broad as to effectively ban rough sleeping in the city.

The changes will also give council officers the power to confiscate unattended items, forcing homeless people to pay a fee to get them back.

In the face of mounting criticism, a further clause was inserted last night for outreach workers to accompany those enforcing the by-law.

Lord Mayor denies homeless will be forced from the city

Lord Mayor Robert Doyle, who voted in support of the changes, said council staff would not be sent out early in the morning to harass people sleeping rough.

"There is no intention to push people out of the CBD, no intention to do that," he said.

The Lord Mayor stressed the vote was not final and the changes would be open for public comment for 28 days, before a final decision on implementing them.

"If we are wrong, I will concede we are wrong," he said.

"At this point, I will support this motion."

Handwritten cardboard signs detailing a homeless person's story and asking for support are a common sight. ( ABC News: Jane Cowan )

The meeting heard the council recently doubled its budget for fighting homelessness to $3.5 million.

Deputy Lord Mayor Arron Wood said the number of rough sleepers had increased dramatically and the council needed to act in the interests of ratepayers.

"This is not about arresting homeless people," he said.

"This is about trying to get them onto pathways, whether that's housing, whether that's mental health assistance, whether that's substance abuse assistance — there are really, really, complex problems."

'It's like legislating you can't be poor'

Kate Colvin, acting CEO of the Council of Homeless Persons, said the changes would push vulnerable people into the criminal justice system.

"It will increase people's interaction with the justice system," she said.

"They will end up with fines which they cannot pay, they'll end up with arrests for reacting to council officers.

"Increasing imprisonment will be a consequence of that."

President of the Law Institute of Victoria, Belinda Wilson, said the changes would effectively make sleeping rough in the city illegal.

"It's being very harsh on vulnerable members of our community that need longer-term solutions," she said.

"You need to look at underlying causes of homelessness: things like mental health, domestic violence, drugs and alcohol."

She said the wording of the by-law was too vague and urged councillors not to go ahead with the changes.

"Practically I'm not sure how this would work," she said.

Launch Housing, which has been helping to find accommodation for the rough sleepers outside Flinders Street Station, labelled the changes "dumb policy".

The organisation's chief executive, Tony Keenan, said banning rough sleeping would not solve Melbourne's homelessness problem.

"It makes as much sense as legislating to say you can't be poor," he said.

"We would be shifting people from the City of Melbourne to a neighbouring city which would be the City of Port Phillip or the City of Yarra."

He said forcing the homeless away from busy, well-lit city streets would put their safety at risk.

"More risk of assaults, more risk of injuries, more risk of people dying on the streets," he said.