Allan defends silence on 'unacceptable' Games costs

The department's updated budget estimate of $4.5 billion was knocked back in April as it was told to explore cutting costs.

On June 13, Ms Allan told a budget estimates hearing that Victoria was making "tremendous progress" on delivering the Games and gave no indication of budgetary concerns.

Later that same day, Department of Premier and Cabinet secretary Jeremi Moule flagged cost blowouts with then-premier Daniel Andrews.

Law firm Arnold Bloch Leibler was hired on July 14 as the Victorian government sought legal advice.

Speaking to reporters on Tuesday, Ms Allan said it was proper government decision-making process to ask officials to go back to the drawing board.

"Clearly these numbers were becoming unacceptable to government, which is why we sent officials back to do more work to further explore the options," she said in Werribee.

"And at that point, through that March/April period, it was considering the options about how to best deliver the Games in line with the agreement that was signed."

Ms Allan said she stood by the evidence she gave to the Public Accounts and Estimates Committee when asked if she had been less than forthcoming.

"The progress at that point in time was about working out how to best deliver the Games," she said.

"We were asking officials to provide us with advice but no final decisions had been made about the budget at that point in time."

It was announced in April 2022 multiple regional centres would host the Games, with a $2.6 billion cost confirmed in the budget the following month.

But former premier Daniel Andrews on July 18 this year announced the Games were cancelled, citing estimated costs rising to up to $7 billion.

Public hearings for the upper house inquiry will restart on Friday.

Ms Allan is refusing to appear despite the committee intending to send her a formal invitation.