Some 3000 of Melbourne's "most vulnerable" residents will be locked in nine public housing estates for at least five days due to a Covid-19 outbreak.
Premier Daniel Andrews said that in recent days, at least 23 cases had been identified in more than 12 households in the Flemington and North Melbourne public housing estates in inner Melbourne.
Andrews said the nine towers included 1345 units of housing and were home to about 3000 residents.
It comes as Victoria recorded its second-highest ever daily increase in coronavirus cases, with 108 people diagnosed with the virus overnight.
Postcodes 3031 - taking in Flemington and Kensington - and postcode 3051 - covering North Melbourne - will be added to the list of suburbs already under stay-at-home orders from midnight tonight.
Under the stage three restrictions, people in the 12 suburbs can only leave the house for four reasons: work or education, exercise, medical care or caregiving or shopping for supplies.
However, those living in the nine public housing estates will be in a "hard lockdown" and not able to leave their residence for any reason.
Making the announcement at 4:00pm on Saturday, Andrews said the new rules were "effective immediately" for the estates.
There have long been concerns of overcrowding in the densely populated public housing blocks.
Deputy Chief Health Officer Annaliese van Diemen said living in close quarters and sharing facilities made transmission more likely.
"We are extremely concerned that there are many hundreds of people in these towers who have already been exposed to the cases that we've found and possibly to cases that exist and that we haven't found," she said.
"This is not just a matter of 23 to 30 odd people, this is a matter of many hundreds who have already been exposed and who may already be incubating."
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Dr van Diemen said the first priority was to find every infection within the towers.
"So that we don't have an explosion of infections in a highly vulnerable community and very high rates of hospitalisations and deaths because of the background health status of a large number of people in these towers," she said.
Victorian Public Tenants Association executive officer Mark Feenane said while Covid-19 did not discriminate based on income or housing tenure, "overcrowded living conditions assist the virus to spread".
"We believe that if Victoria had more public housing, this would be less of an issue," he said.
Acting Australian Chief Medical Officer Paul Kelly said an emergency teleconference meeting of the Australian Health Protection Principal Committee was called for Saturday evening to discuss Victoria's rise in coronavirus cases.
The estates will be fully locked down for at least five days to test everyone and get results back, but the Premier said it could extend for up to 14 days.
Victoria Police will oversee the towers, with at least 500 officers per shift on the job and police stationed on every floor.
The effort will be led by Assistant Commissioner Mick Hermans, who coordinated bushfire evacuations over the summer.
Andrews said it was in many respects the "most challenging issue" Victoria had dealt with throughout the entire pandemic.
"We know and understand that it is a big cohort. It is also a group of people, many of whom are amongst the most vulnerable in our Victorian community," he said.
"But the risk to public health at a personal and family level, the health and wellbeing of those residents, who all live very close to each other, the fact that there are positive cases in some of those towers and logical patterns of movement, friendship groups, family groups, mean that the best and most appropriate step is the hard lockdown in those nine towers."
The Premier said it would be a "massive logistical task" to feed all the residents of the towers. Financial support is expected to be made available during the shutdown.
Community transmissions rise again
The last time Victoria had more than 100 cases in a day was on 28 March, when 111 infections were recorded - many of them returned travellers.
There are now 389 cases of suspected community transmission in the state, an increase of 26 since yesterday.
Locally acquired cases are classified as community transmission if, after investigation by the health department, no source of infection can be found.
Of the 108 new infections, 14 are linked to controlled outbreaks, 25 were detected through routine testing and 69 are under investigation.
More than 25,000 people were tested for Covid-19 on Friday.
The Premier denied it was inevitable all of Melbourne would eventually be locked down, but would not rule it out.
"There are now 12 postcodes locked down. If we don't all work together and follow the rules every postcode will be locked down," he said.
Andrews said earlier this week genomic sequencing revealed a number of the new infections could be linked back to security contractors in state-run hotel quarantine breaching infection control protocols.
The State government is under scrutiny over its handling of the state-run hotel quarantine program, which is now linked to more than 50 Covid-19 infections.
A $A3 million judicial inquiry, led by Justice Jenifer Coate, will examine how the virus was allowed to spread from returned travellers to security contractors and then into the community.
The Premier today denied the government had lost control in its fight against the virus.