The biggest problem I have found with these starters is the release lever No29.As it connects to a piece (which I think in that is No27) the dog release assembly.As that can be worn and then doesn't lock in and will cause the spring hub assembly No31 not to lock in and cause the problem you are having.So I'd look there first,it is a common problem as they do wear out.
Hope that made some sense.
The pawl on the 'dog release assembly' is spring-loaded. A common failure mode was for the spring to fail. So the pawl would then no longer be pressed against the spring hub teeth, and it usually wouldn't engage to lock the hub, unless you got very lucky! Replacing the dog release assembly was a common job, back in the day.
The 'Victa Old Starter' doco at
https://www.outdoorking-forum.com.au/forum/ubbthreads.php?ubb=showflat&Number=54967 shows the setup before the dog release became an 'assembly'.
