But GWMWater corporate services manager Andrew Rose said GWMWater tested the St Arnaud cemetery water and found no trace of sewerage.

"There was no evidence of infiltration of waste water storage into groundwater," Mr Rose said.

St Arnaud cemetery is close to GWMWater's St Arnaud waste water treatment plant.

St Arnaud resident Matt Batters said the St Arnaud cemetery was below world standards.

Mr Batters said he and his wife's parents were buried in St Arnaud cemetery. He said when he visited the graves they were covered in water.

"I don't think in this day and age our cemetery meets the required standards," Mr Batters said.

"If you bury someone in the bottom section of the cemetery you'll be burying them in sewerage.

"The water there is far greater than the natural water you would expect to see.

"Even with a few showers the graves are soaked."

Mr Batters said he had reserved a grave for himself and his wife in the St Arnaud cemetery.

"I just don't feel like putting myself and my wife in there," he said.

"You'd have to take swimming lessons. My wife can't swim."

Mayor Bryan Small said council had raised the issue with GWMWater.

Council customer services general manager Jim Nolan said council was aware there was a problem.

Mr Nolan said council workers inspected the St Arnaud cemetery last week.

"Whether the water is from the effluent treatment pond or groundwater hasn't been determined," Mr Nolan said.