A proposed inquiry into the historical abuse of children in state care has been extended to include abuse within faith-based institutions.
The Royal Commission into state care abuse has been in a preliminary process since February, and on Monday Prime Minister Jacinda Ardern stated Cabinet agreed to expand the inquiry.
The newly named inquiry will now be known as the Royal Commission into Historical Abuse in State Care and in the Care of Faith-Based Institutions, which reflects the wide scope of the inquiry.
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It is expected to cost $78.85 million over a four-year period.
"Today paves the way for us to confront a dark chapter of our national history by acknowledging what happened to people in state care, and in the care of faith-based institutions, and to learn the lessons for the future," Ms Ardern said.
"It was critical we got the Royal Commission right and the scope and purpose of this inquiry has been carefully considered."
The first interim report which is focused on state care abuse will be reported back by the end of 2020, while a separate report will focus on the abuse of children in faith-based institutions.
"We must learn from the mistakes of the past, and take responsibility for them," Internal Affairs and Children's Minister Tracey Martin said.
"We recognise the seriousness of abuse and confirm our commitment to considering future measures to help protect all children, young people, and vulnerable adults."
The $78.85 million budgeted for the inquiry includes more than $15 million to provide counselling and related support to participants.
The inquiry will begin hearing evidence in January next year, and a final report of the Royal Commission's findings will be submitted to the Governor-General in January 2023.