Almost 200 packed into the historic building as Indi MP Helen Haines launched the "Beechworth principles".

The principles call for a federal integrity commission that covers everyone in the public service, including politicians; has powers to refer conduct for prosecution; conducts fair hearings; and is accountable to the people.

"Our politics is prone to corruption and partiality, scandals abound, and people no longer believe politicians can be trusted," the statement of principles said.

Tuesday's event was about history repeating.

In 1853, an innocent gold digger was shot by police in Beechworth, and historian Jacqui Durrant said that in a misuse of power, police and government suppressed evidence while holding a closed inquiry into themselves.

This started what has been described as a "democratic revolution", where gold diggers started a petition with the original Beechworth principles, demanding the right to vote so colonial leaders would be accountable.

Dr Durrant and Dr Haines planned to launch the new Beechworth principles in April, to coincide with the 167th anniversary of the petition, but the MP said the sports rorts scandal brought out angst and made the issue of corruption feel very real.

"We felt we needed a way to give people hope and give people a remedy," Dr Haines said.

Former Supreme Court Justice David Harper was in Beechworth to speak and support the launch, and he took aim at Senator Bridget McKenzie and the government.

He said her response that she had discretion to award the grants as the minister and that they were eligible was "absolutely irrelevant".

"Ministers do not have discretion to use public money, our money, in ways in which are absent of any sense of integrity," he said.

"The dismissal of Senator McKenzie is an episode which has shown the depth of lack of trust in government and the lack of an appropriate response by government to what the bulk of the community would accept as being the essence of integrity in government."

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Justice Harper said the low level of trust in government had become sad, despite its insistence that Canberra is "clean".

"Where there is power and there is money, there will be the temptation for corruption," he said.

"It's particularly fitting that a town like Beechworth and an electorate like that of Indi has shown itself to be central to what is now a really important national movement. We need a national integrity commission."

The government agreed to introduce a bill for an integrity commission after Cathy McGowan pushed for it in 2018, but is yet to release a draft.

Dr Haines said she hoped it will include aspects of the Beechworth principles, which would provide "real teeth", and the document has been sent to Attorney-General Christian Porter.

"If you've been disappointed in the behaviour of government in recent weeks and in recent years, you understand why we need a federal integrity commission. If you feel like politics is broken and politicians are in it for themselves and democracy and democracy can no longer solve our big problems, you understand," she said.

She launched a petition calling for a commission, which she said she hopes will get thousands of signatures she can take to the House of Representatives.