Taxpayers might have to fork out millions of dollars in compensation payments as a result of decades of alleged sexual abuse, assaults and bastardisation within the armed services, Defence Minister Stephen Smith has said.
Mr Smith admitted yesterday the Commonwealth could eventually be forced to pay a hefty bill in compensation to some former military personnel.
The Defence Department has been rocked in the past week by a flood of complaints of sexual assault and misconduct and it is understood Mr Smith's office has been inundated with several hundred claims, some of which pre-date Australia's involvement in the Vietnam War.
Mr Smith did not rule out the possibility of a judicial inquiry into abuse and bastardisation in the Army, Navy and RAAF.
He has already opened six inquiries into Defence culture in the wake of the so-called Skype sex scandal at the Australian Defence Force College and has set up an independent team of lawyers to sift through the masses of claims now being sent to his office.
Mr Smith said his group of legal experts would advise him on the best way forward, which could include an independent probe led by a judge.
"It may require further legal work on individual cases, it may require a more general and a judicial approach to the general complaint or suggestion that over a long period of time, complaints were covered up or not investigated properly," Mr Smith said. "There is a distinct possibility, either in individual cases or more generally, that through the Department of Defence or through the services, there is a Commonwealth liability here.
"That is why I say we need to proceed carefully."
At the weekend, independent Senator Nick Xenophon suggested a class action by aggrieved Defence personnel could be the best way of driving cultural change.
He has voiced his support for Adelaide man Neil Batten, who claims he was raped and abused at HMAS Leeuwin in East Fremantle in 1971.
It came as Tasmanian independent MP Andrew Wilkie refused to apologise over claims he had subjected Defence recruits to abuse when he was at Duntroon in the early 1980s.
Mr Wilkie said he could not remember ordering recruits to make Nazi salutes. He said he planned to meet the former soldier who made the allegation this week.
Mr Wilkie has admitted he was badly behaved at Duntroon, saying he was "bastardised" and was "a bastard".