A Victorian parliamentary committee has called for a major overhaul of the state's police oversight system after a 15-month inquiry into how claims of misconduct and corruption are investigated.

Key points: The committee recommended IBAC be empowered to investigate more complaints against police involving serious misconduct, assault or wrongful arrest

The committee recommended IBAC be empowered to investigate more complaints against police involving serious misconduct, assault or wrongful arrest It also suggested the creation of a Police Corruption and Misconduct Division within IBAC

It also suggested the creation of a Police Corruption and Misconduct Division within IBAC Lawyers praised the recommendations as "absolutely historic"

In a report tabled in Parliament, the joint committee stopped short of recommending a new body to deal with complaints, but called for major reforms.

The report made 69 recommendations aimed at improving the complaints system, including a requirement that the state anti-corruption watchdog, Independent Broad-based Anti-corruption Commission (IBAC), investigates more allegations of serious police misconduct.

It found the current system was "extraordinarily complex and confusing" and based on an "intricate, overlapping, and sometimes fraying patchwork of laws, policies and processes".

Currently, about 98 per cent of complaints are referred back to Victoria Police for investigation.

"The committee considers that the proportion of complaints that IBAC investigates is insufficient," the report said.

Complaints shouldn't go back to police

The report also called for the creation of a new dedicated Police Corruption and Misconduct Division within IBAC that is properly resourced to investigate complaints, according to Liberal MP Kim Wells, the committee chair.

"So there's an equal focus on oversighting police conduct as there is with the investigation of corruption within the public service," he told ABC Radio Melbourne.

IBAC should get additional powers, the report said. ( IBAC )

He said the committee agreed that police command must maintain its own discipline over its own workforce but that doesn't mean police should investigate themselves.

"However, what we're stipulating now is if it's serious misconduct that should be investigated by IBAC and not referred back to police, unless there are exceptional circumstances," he said.

The report proposed a new definition of serious police misconduct to include cases involving serious assault, wrongful arrest, serious mistreatment in police custody, use of excessive force and human rights violations.

It also recommended IBAC be given additional powers, including the power to order Victoria Police stop an investigation or to veto the appointment of a particular police investigator.

The report also called for changes to the way Victoria Police handles its own complaints and investigations, including by requiring investigators are free of any conflicts of interest.

Currently, IBAC only investigates 2 per cent of complaints against police. ( ABC News: Stephanie Anderson )

'Current system is broken'

Tamar Hopkins, from the Police Accountability Project at the Flemington and Kensington Community Legal Centre, said the report was "absolutely historic".

"We have a committee recognising that the current system is broken and that profound change needs to occur in Victoria," Ms Hopkins said.

"This is the first time that any official body has taken this as seriously as we see in this report."

Lawyer Jeremy King said it was "significant" that there would now be a definition of misconduct and clearer rules around what IBAC would investigate.

"If it falls within [IBAC's] mandate they have to investigate it. They can't just refer it back to Victoria Police to deal with. And that's really significant," he told ABC Radio Melbourne.

Ms Hopkins said until now IBAC's focus has been on corruption, rather than misconduct, and that a new specialist division within the body would help steer the direction.

"That's a real step forward," Ms Hopkins said.

But she also raised concerns about a lack of transparency provisions, including a continued exemption of IBAC complaint handling from FOI requests and a lack of judicial review.

"That's deeply concerning," Ms Hopkins said.

"It's a basic part of democracy that that be allowed."