NSW has become the first Australian state to legislate its participation in a national redress scheme to support survivors of institutional child sexual abuse.
Passage of the bill through parliament on Wednesday night was described by the NSW attorney-general as a "milestone" for those who had suffered sexual abuse in institutions.
"This continues NSW's leadership in establishing the scheme, including being one of the first two states to announce its participation," Mark Speakman said in a statement on Thursday.
Once other states join up, the scheme will offer payments of up to $150,000 per person, provide access to counselling services and require the institutions responsible to directly respond to survivors.
Mr Speakman urged other states, territories and institutions to join the scheme and thanked survivors for their resilience.
"Your stories have been heard and will not be forgotten," he said.
But some have criticised the scheme for excluding people with serious criminal histories.
"Every Australian deserves access to the redress scheme... to receive the compensation they deserve," NSW Greens MP David Shoebridge told AAP on Thursday.