The art of light writing, as playwrights like Oscar Wilde demonstrate, is a serious business. Writing a light play about serious business is even more serious. The danger is that "light" - which is not, by any means, a synonym for "slight" - can so easily become banal or substanceless or, worst of all, indigestibly soggy in the middle. It requires a quicksilver theatrical wit, faith in the intelligence of the audience, a lot of writerly tact and, perhaps most of all, the ability to keep contradictory impulses in dynamic suspension. You can see all these qualities at work in Robert Reid's On the Production of Monsters, now playing in the Lawler Studio at the Melbourne Theatre Company.

Virginia Gay and James Saunders. Photo: Jodie Hutchinson

Set in the cafes and offices of inner-city Melbourne, On the Production of Monsters exploits hipster urban chic even as it pokes fun at its absurdities. The elegant conceit is that each scene is a dialogue between different characters, all of them played by the same two actors, Virginia Gay and James Saunders. The plot revolves around the young couple Shari and Ben, uber-cool Melburnites who, following the unwritten laws of hipsterdom, recognise the hip in everyone but themselves. They are sweeter than they realise, basically well-intentioned and harmless. Reid is interested in how these two are transformed, through an innocent mistake, into the favourite monster of the tabloids: child pornographers.

The play opens with Ben and Shari breakfasting in a cafe, tallying up points for hipster-spotting while they sip their coffees. Ben works in a call centre for the local water authority, where he embarrassedly fends off awkward advances from his supervisor. Shari, a keen environmentalist and aspiring artist, is seeking funding for a project which will see children from local schools clearing rubbish from the banks of the Merri Creek. When she is interviewed by an ambitious young reporter from the local newspaper, she forwards him an email leaked by Ben, which has the minutes of a meeting from the water authority. Unfortunately, Ben has also forwarded a photo of a naked and possibly underage girl which his boss has sent to him as a coarse attempt at seduction.

The reporter is much more interested in the nude photo than the minutes, and the story rapidly escalates to a national scandal about child pornography. In this, Reid is consciously echoing the scandal that erupted around Bill Henson in 2008. Just as the offending Henson photograph was discovered not to be obscene at all (and was in fact rated PG by the Classifications Board), so here the photograph isn't child pornography, although the question of its obscenity is left open. The play's concern is really with the unstoppable machine of manufactured public outrage.

Step by step, we watch Ben hang himself. At his boss's request, he even erases the evidence that would prove his innocence. The personal fallout is devastating. Labeled a paedophile by the media,  Ben loses his job and, the public taint now indelible despite the lack of a conviction, any prospect of a career. Worst of all, he begins to question his own motivations. Shari loses her Merri Creek project, which goes on without her, and breaks up with Ben. The damage spreads even to the lawyer who decides to represent Ben, who finds her practice disastrously depleted by her public defence of a widely exposed paedophile.

One of the virtues of On the Production of Monsters is the modesty of its pretensions. Reid draws no morals and refrains from lecturing; rather, he works his themes subtextually beneath a finely detailed, and often very funny, surface of dialogue. The story is told elliptically in a series of scenes that, not unincidentally, create a slyly hilarious portrait of 21st century Melbourne, in much the same way that Seinfeld sketched 1990s New York. Nothing is over-written, and there's a lot of play in the language that is beautifully picked up by the actors. What comes into precise focus is the human mundanities and complexities that exist beneath the stark judgments of sensationalist headlines.

None of the characters is innocent or, importantly, without innocence. In leaking confidential minutes to his girlfriend, for instance, Ben is hardly in a position of moral superiority. Shari is a fantastist, exploiting the kindness of strangers to compensate for her nagging sense of insignificance. Ben's boss, a woman with the sensibility of a brick, manipulates him easily, and gets a promotion while his career spirals into disaster: yet beneath her brash exterior, she is palpably lonely and insecure. The subtleties of Melbourne diction, from the Werribee office manager to the lisping inner city primary school teacher, are all richly written, deftly avoiding cliche. If this play weren't so accurate and astringently intelligent, it might all be too cute for words.

As with the play, director Clare Watson and her design team unashamedly place the action in a very local here and now. The action moves swiftly and lucidly, and never quite in the way you might expect. The production is driven by two excellent performances that particularly shine in how Gay and Saunders sketch the fragility and need in the relationship between Ben and Shari. The comedy is sharp but surprisingly gentle, and the production generates a subtle but insistent emotional texture that culminates in a deeply moving, and wordless, final scene.

Andrew Bailey's ingenious traverse set is a highlight: the initially bare stage has a wealth of pop-up props that the actors assemble for each scene, so by the end the stage is littered with the detritus of the action.  Like many others, I couldn't help having a closer look as I left the theatre at the iconic Melbourne imagery embedded inside it: the Melways beanbag, Banksy's parachuting rat (now sadly destroyed), the inevitable glasses of latte. This is the kind of play which makes it difficult to deny the real pleasures of recognition, but its charm relies on the characters it draws for us; local colour is stroked in as unobstrusively as a samovar in The Three Sisters. It adds up to a gem of a production, a work in which an unassuming integrity shines in every decision.

On the Production of Monsters by Robert Reid, directed by Clare Watson. Sets and costumes by Andrew Bailey, lighting design Richard Vabre, composer Kelly Ryall. With VirginiaGay and james Saunders. Lawler Studio, Melbourne Theatre Company, until June 9.