The Victorian government is in damage control after revelations government agencies had funded a Scientology concert at the same time Canberra considers an inquiry into the sect.

Taxpayer-funded peak body Multicultural Arts Victoria and government agency South East Water are listed as backers of a  “free concert” hosted by Scientology front group Youth for Human Rights Australia at Melbourne’s Federation Square as part of the “Unite Festival” on 13 December.

The International Human Rights Day event will feature MAV-produced “do the right thing” concert, an “ethical fairground”, a year-9 art exhibition inspired by a Scientology DVD, capped by a performance from celebrity Scientologist Kate Ceberano.

The art exhibition is sponsored by the 100% government-owned South East Water, with the agency named on the YHRA website as a “major sponsor” providing “valuable support in furthering the education of our Youth in the subject of Human Rights”. The federal government has also backed the festival through an Australia Council “community funding arrangement” with MAV.

According to its promotional material, YHRA aims to spread the gospel of human rights by recalling the wisdom of Scientology founder L. Ron Hubbard, who is referred to as a “famous human rights leader” in the same breath as Martin Luther King and Mahatma Ghandi.

Following Crikey‘s queries this morning, Victorian arts minister Lynne Kosky said the government would immediately pull the MAV’s logo from the festival’s website. A spokesperson blamed the gaffe on a “junior project officer” who was believed to be unaware of the Scientology connection.

Multicultural Arts Victoria executive officer Jill Morgan told Crikey that  MAV had “sought to book Federation Square for its event and was informed two other groups had also asked to book the same space for events on a similar human rights theme”.

She said MAV had liaised with the Scientology group when planning the event but that the activities on the day would be separate.

Among a raft of other sponsors on the Unite Festival’s website is the City of Melbourne, the Victorian Multicultural Commission, the Arts Centre, the Australian government and the Australia Council.

The Australia Council stood by its involvement this morning, with a spokesperson claiming that it supported “freedom of artistic practice —  within the confines of the law”. However, the City of Melbourne distanced itself, saying it would immediately move to have its logo pulled. A spokesperson said the city council hadn’t heard of the festival before it was contacted by Crikey.

Other sponsors include Scientology-linked businesses hellohello.com.au and internet-success.com.au. Both websites contain links to Scientology literature with high-profile Hello Hello gardeners Chris and Marie keen to spruik the services of Narconon, which aims to “get people off drugs” through the church’s teachings.

This is not the first time the controversial group has been criticised for its Federation Square sermons. Sources have described a farcical situation in previous years as hundreds of T-shirt wearing devotees packed the concert and distributed pro-Scientologist pamphlets.

Earlier this week it was revealed YHRA was covertly distributing Scientology propaganda to primary school children around Australia under the aegis of human rights. References to the group’s link to the cult were buried in the document’s fine print. After the revelations surfaced, Senator Nick Xenophon slammed the group as “a recruitment mechanism for new members of the Church of Scientology”.

Senator Xenophon, who, alongside the Greens, has called for a wide-ranging inquiry into Scientology, last week raised serious allegations of criminal activity, blackmail and concealed abortions under parliamentary privilege.

Calls to YHRA’s Sydney office rang out this morning and emails were not returned before deadline.