The Newcastle MP was speaking after The Herald's story about Lyn Rudkin, who endured a deeply re-traumatising experience to sue the Anglican Church and State of NSW for alleged abuse she suffered as a child. Ms Rudkin did not pursue redress due to the level of abuse, with the scheme being capped at $150,000.

"The trauma she is reliving is appalling," Ms Claydon said. "For people like Lyn and many others with very strong, complex cases, when lawyers look at those matters they would be advising them to go through civil litigation process to end up with a better financial settlement.

"The down side is just how traumatic that adversarial legal system can be.

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"Survivors of child sex abuse are now being asked to choose between redress and settling for something less or going through deeply traumatic adversarial legal system that flies in face of everything we learnt from the Royal Commission."

As of March 4, the scheme had made 7714 payments, totalling about $666 million at an average of $86,329. But the royal commission estimated there were 60,000 people eligible for redress.

Ms Claydon said in the scheme design, the cap was dropped from $200,000 to $150,000. A review last year also recommended reviewal the restriction on survivors making a single application, but this was not accepted.

A Department of Social Services spokesperson said survivors can name multiple institutions and "this will be taken into account" in their application assessment. "The maximum payment amount is based on careful discussions with the Independent Advisory Council and state and territory governments. It balances the need for survivors to get access to the redress that they absolutely deserve and ensures that institutions have the financial capability to join the scheme and pay redress," the spokesperson said.

Ms Claydon said the scheme needed to be better at reaching out to eligible citizens, particularly First Nations people, while also listening to the needs of survivors and asking why participation is still so low after three years.

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