Local government funding and services will be examined by a parliamentary inquiry amid accusations the Victorian government is passing its costs onto ratepayers.

The Victorian Legislative Council's economy and infrastructure committee will consider and report on alleged cost-shifting onto local councils, local government service delivery and councils' overall revenue structure and sustainability.

The opposition pushed for the inquiry.

"It's about more than just looking at council rates, we have to go back to square one and examine the entire funding model for local government," Nationals Leader Peter Walsh said in a statement.

"We need to look at what affects council's ability to manage core responsibilities like rubbish collection, road maintenance, footpaths and libraries."

Mr Walsh said the state government had been lax in its approach to issues in the sector.

"Labor completely ignored 20 recommendations from their own local rating system review of 2019," he said.

A spokesman from the Victorian government said they would work with councils to ensure they had the support they need.

"Dictating to councils what services they are and are not allowed to provide to their communities would be totally inappropriate," they said.

The committee will complete its inquiry and deliver recommendations to government by June 30, 2024.