'Overwhelming' evidence of the system's failures were unearthed by the Ombudsman despite Public Transport Victoria and the Department of Economic Development, Jobs, Transport and Resources failing to co-operate with the investigation.

Ombudsman Deborah Glass noted that she used her office's coercive powers to inspect PTV board minutes for the first time after the authority provided inadequate information, while the department took two months to provide information that was requested to be provided within 14 days.

"The issues in obtaining documents from both the department and PTV put my investigation six to eight weeks behind schedule and has delayed my tabling this report in the Parliament," Ms Glass wrote.

Ms Glass noted in her foreword that a previous report by her office, in 2010, had criticised the fare enforcement regime.

"Sadly things have not improved," she wrote.

Her report, released on the same morning the Andrews government put out details of its own plans for reform, lashed the "disproportionate and poorly targeted" regime.

"The current approach has not got the balance right between financial imperative and fairness," Ms Glass wrote. "It hits the vulnerable and innocently ignorant and fails to focus on recidivist fare evaders."

More than two-thirds of fare evasion on Victoria's public transport system is committed by just 1.7 per cent of travellers, yet the enforcement system's "drift net catches large numbers of unsuspecting tourists, students, homeless people and numerous other 'one-off' evaders, many of whom are left baffled, distressed and almost invariably poorer".

The system's failures include a lack of discretion, or proper training for the system's 600-plus authorised officers about when to exercise discretion.

"If an infringement will eventually be withdrawn due to the 'special circumstances' of someone's vulnerability, why waste bureaucratic time and money, and cause personal distress?" Ms Glass wrote.

Investigators interviewed two senior Metro Trains authorised officers, who said there were no guidelines and no training for using discretion.

This lack of discretion has led to tens of thousands of infringement notices being challenged in the court system, which neither the courts nor the Department of Transport has the resources to deal with.

Just one in five infringement cases is successfully prosecuted in the courts.

"The department's prosecution teams and the courts are unable to respond in a timely way, meaning there can be an accumulation of infringements, escalating costs and lengthy delays," the report said. "In the end, the state recoups a very small fraction of its costs in pursuing these matters, given that only two in ten result in any financial penalty."

The report recommends 12 changes, including keeping records of recidivist offenders to better target them, withdrawal of infringements for not carrying a concession card if the offender can later prove they were entitled to concession travel, and giving authorised officers powers to choose not to fine the homeless.

A Public Transport Victoria spokesman said the authority had not intended to delay or confuse the Ombudsman's investigation.

"We regret any delay that we may have caused to the investigation," he said.

The authority has accepted the Ombudsman's recommendations and promised to work with the Transport Department and operators to implement them, including better training for authorised officers.

Luba Grigorovitch, state secretary of the Rail, Tram and Bus Union, said it had called for improved training for a long time.

"AOs are there to do a job and are often put in very tough situations with undesirable members of the public," Ms Grigorovitch said.

"They are faced with controversial situations daily and a lack of training has gone on for too long. We commend the implementation of training and we are sure this will lead to better customer service for the travelling public."

With Benjamin Preiss