"Everybody should participate fully, but how the inquiry's run is a function of both the terms of reference which I believe are more than adequate, as well as the budget that's more than adequate," he said.

"As to how it's conducted beyond that, that's entirely a matter of Justice Coate and I'm confident that she will do that work well.

"What went on here is completely unacceptable to me … The best thing to do is to have that proper understanding of exactly what went on."

In addition to government bureaucrats, individual hotel staff, security guards and members of the public could be called to give evidence.

More than a dozen hotels and security companies have been put on notice and asked to submit responses to the inquiry, which opened in Melbourne on Monday.

"I expect no less than full, frank and timely cooperation from all government entities and persons to enable me to do my job for the people of Victoria," Justice Coate said.

Counsel assisting the inquiry, Tony Neal, QC, said evidence already before the inquiry suggested a possible link between the current COVID-19 outbreaks in the community and the hotel quarantine program.

"Comments made by the Chief Health Officer to the media have suggested that it may even be that every case of COVID-19 in Victoria in recent weeks could be sourced to the hotel quarantine program," Mr Neal said.

"Increasingly in recent weeks there has been growing and understandable community concern about transmission from that program into the general community."

The Department of Premier and Cabinet, the Department of Health and Human Services, the Department of Jobs, Precincts and Regions, the Department of Justice, Victoria Police, Emergency Management Victoria and Ambulance Victoria are of interest to the inquiry, he said.

Mr Neal also named six hotels that have been put on notice, including the Rydges on Swanston which has been linked to 16 cases so far and the Stamford Plaza, which has been linked to 43.

Also on the list are Travelodge Melbourne, Park Royal Hotel Melbourne Airport, Holiday Inn Melbourne and Four Points Sheraton.

Eight security companies have also been given notice, including MSS Security, Unified Security Group and Wilson Security, which have been linked to the hotels where outbreaks emerged.

The remaining contractors include United Risk Management, Ultimate Protection Services, Elite Protection Services Australia, Australian Protection Group and The Security Hub.

The inquiry will examine the key decisions behind the hotel quarantine scheme, including contractual decisions, the suitability of contractors and the supervision, training and resourcing of security guards.

Mr Neal warned employers face significant penalties if they attempt to deter employees from giving evidence to the inquiry.

The inquiry, which has the power to force government agencies to produce documents, is adjourned until August 6, when the first round of witnesses will be called.

Mr Neal said the inquiry also has the power to suppress information it deems sensitive that could cause harm or prejudice legal proceedings.

The Premier established the inquiry on July 2 after Chief Health Officer Brett Sutton said genomic sequencing revealed most, if not all, of Melbourne’s second surge in coronavirus cases could be linked to security guards from hotel quarantine.

Since the first security guard at Rydges on Swanston tested positive on May 27, the quarantine program has been blighted by complaints of inadequate training, shortages of personal protective equipment and individual breaches of guidelines by security guards.

After the first cluster emerged at Rydges on Swanston, a second outbreak linked to the Stamford Plaza hotel spread to 43 security guards and their close contacts.

with Paul Sakkal