The state government wants better environmental and financial management in place at Victoria’s iconic Hanging Rock.

A recent comprehensive review by the government of Macedon Ranges council’s management of the landmark volcanic formation identified key areas for improvement.

Shortcomings identified related to the popular outdoor music and sports precinct’s governance, local community engagement and the need for clear strategic directions to identify future investment needs for entertainment areas and the nature reserve.

The government is proposing to strengthen Hanging Rock’s management procedures, offering greater financial transparency and more community consultation.

Macedon Ranges council will retain the committee of management of Hanging Rock Reserve.

Environment, Climate Change and Water Minister Lisa Neville endorsed the council’s ongoing management of the site and said there were a number of key recommendations to ensure a sustainable long-term management plan for Hanging Rock was achieved.

“Effective strategic change is necessary so that all parties can work together,” Ms Neville said. “We hope to work with the council and community to ensure the Hanging Rock precinct has a sustainable future.”

The government proposes key changes that involve Macedon Ranges council working with the Department of Environment, Land, Water and Planning (DELWP) to expand the advisory committee and include greater environmental representation.

A new masterplan will also be developed for the precinct, including East Paddock, in consultation with nominated stakeholder groups, and the council will release annual reports to the DELWP detailing income and expenditure directly related to activities at Hanging Rock Reserve. The reports will be publicly available.

Mayor Graham Hackett said he looked forward to seeing Hanging Rock continue to thrive as a tourist destination, a retreat for locals and a site of ecological and cultural significance.