Vic MP distressed over racist allegations

A Victorian Liberal MP says she was hurt and distressed by "unfounded" allegations that she had been racist towards a party member.

Upper house MP Inga Peulich said the allegations had taken a toll on her family.

Last year a Liberal Party member accused Ms Peulich of verbally abusing him and racially bullying him.

He recently apologised to her and agreed that she had not made the comments.

"As a person who migrated to Australia from Bosnia and Herzegovina as a child, as an MP and now shadow minister for multicultural affairs in the Victorian parliament, such allegations are serious and the effect of this smear on my family has been both hurtful and distressing," Ms Peulich said on Wednesday.

The Liberal Party launched an investigation into the comments when they were first reported in June 2015.

"The allegations have taken a toll on my family, my elderly mother in particular," Ms Peulich said.

"It is a period of my life that I am glad to put behind me."