Prime Minister Julia Gillard said on Monday that she will recommend to the governor-general the formation of a royal commission that would investigate child sex abuse by Catholic clergy and other religious groups, especially those committed in child institutions.
The decision was the result of several weeks of newspaper accounts that there was apparent cover-up on the part of church officials or the failure of other adults to assist the victims.
"We are now in a circumstance where two states have different inquiries on foot, and because of the allegations of moving people around, this is something that goes beyond the borders of any one state. I've come to the view in those circumstances that a national approach is best," Radio Australia quoted Ms Gillard.
The prime minister explained a federal approach is needed because of reports that priests who sexually abused children were just moved to other parishes or Australian states and continued to work with other children.
Although Ms Gillard emphasised that she is not singling out the Catholic Church since the probe will include different religious groups, schools and state institutions in general, she personally called Cardinal George Pell to discuss the royal commission.
"So this is not a royal commission targeted at any one church. But given the nature of some of the material in the public domain, I thought it was appropriate to speak to Cardinal Pell," ABC quoted Ms Gillard.
He is the Archbishop of Sydney and considered Australia's most powerful Catholic. Mr Pell himself has been dragged into accusations by a former child sex abuse victim that the cardinal was present 35 years ago when the victim, then an elementary student, recounted his ordeal from the hands of a school principal.
However, the cardinal has denied the accusation and said that when the incident happened, he was out of the country.
The Royal Commission will be headed by Attorney-General Nicola Roxon and Minister for Families Brendan O'Connor. The federal government will have a period of consultation to determine the shape of the probe body, which once formed, will link with groups that represent the victims and religious organisations.
There are two separate investigations Victoria and New South Wales into the clergy abuse.
"Both of them are prepared to take a very cooperative approach and to consider how the work that they are doing can best be used to support the work of the royal commission," she added.
Police said the inquiry continues to discover new and more graphic details of the abuse.
Although yet unproven, there are stories that one of the male victims, while being sodomised, was told by the rapist to focus on a St Christopher cross to take his mind off the pain of the forcible entry.
The cardinal has denied he was involved in a cover-up, although he admitted the church must answer for the wrong committed by its clergy.
Detective Chief Inspector Peter Fox charged the church with covering up, silencing victims, standing in the way of police investigations, alerting offenders, destroying evidence and transferring priests accused of sex abuse all in the name of protecting the name of the church.