Tony Abbott must explain why he waited three weeks to provide government funding to Morwell residents and must give more support to those affected by the Hazelwood coalmine fire, says Greens Senator Richard Di Natale.

''The township of Morwell has been engulfed in a blanket of toxic smoke,'' Senator Di Natale told the Senate on Tuesday. ''The potential threat to the health of the residents was immediately obvious. Yet until recently they were denied assistance or support to evacuate.''

The federal and Victorian governments released additional support for businesses on Tuesday that covers Morwell. The Abbott government said it ''stands ready to consider further requests from the Victorian government''.

The fire broke out in a disused part of the Hazelwood open-cut coalmine on February 9.

Mr Abbott last weekend offered relocation payments to residents so they could move temporarily to avoid exposure to smoke and ash. Under a joint funding deal between the federal and state governments, Morwell households wanting to leave the area can apply for relocation payments of up to $1250 a week.

''We have seen a spectacular failure of leadership,'' Senator Di Natale said.