The Victorian Government has threatened to deny funding to organisations that do not join the National Redress Scheme for institutional child sexual abuse survivors.

The scheme offers a range of redress options to eligible survivors of institutional child sexual abuse, including monetary payments of up to $150,000, access to counselling services and a direct personal response — such as an apology — from the institutions responsible.

The scheme was established in 2018 as a key recommendation of the Royal Commission into Institutional Responses to Child Sexual Abuse.

Commonwealth legislation states that joining the scheme is voluntary, and that institutions must have the financial capacity to pay redress before they join.

Victoria has 49 eligible non-government organisations that have not signed up to the scheme, about half of which receive some form of State Government funding, including some non-government schools, community, youth and family services, religious entities and sport and recreation entities.

There are over 500 applications on hold nationwide because the institution involved has not signed up to the scheme.

Victorian Attorney-General Jill Hennessy says it is “just not acceptable”.

“We will be making it a condition of contracts with the Victorian Government that institutions that have got a liability when it comes to institutional sexual abuse join the redress scheme,” Ms Hennessy said.

“This is about organisations which do have the capacity to pay but have not taken the responsibility.

“We're not going to go and disrupt the way in which services are delivered, particularly to vulnerable people, but we are not going to reward those that have got the capacity to pay but fail to finally take responsibility for the tawdry and tragic history of sexual abuse in their organisations.”