Premier Denis Napthine has announced plans to relocate the Victorian WorkCover Authority head office to Geelong, along with 550 associated jobs.

Dr Napthine said the move, which has already come under fire from unions, would pump $50m into the Geelong economy a year, with the premier talking of developing a cluster of similar services in Victoria’s second city.

“The relocation of WorkCover’s head office to Geelong, in combination with the national headquarters of National Disability Insurance Scheme (NDIS) and the TAC, will create a cluster of insurance and disability related services,” he said.

Dr Napthine said the relocated jobs would be mostly in the administration and back office areas of WorkCover.

The plan is conditional on the Liberal/National coalition winning the 2014 state election.

The state government had been under pressure to do something for the local economy, with Ford announcing earlier in the year it would close its Geelong plant in October 2016 while Target recently cut 200 jobs in the city.

During his time as state ports minister Dr Napthine considered relocating some shipping operations from Melbourne to Geelong, however this idea generated strong industry opposition.

Community and Public Sector Union (CPSU) secretary Karen Batt has argued a WorkCover relocation would cost a fortune in redundancy payouts while adding extra traffic to the road between Geelong and Melbourne.

But Dr Napthine stuck to his guns arguing Geelong has been a manufacturing city with a proud history in the automotive and engineering sectors and these sectors would continue to be a “core activity for Geelong”.