The Australian Government owes an apology and ongoing disability support payments to thalidomide survivors, a Senate report has found.

Key points: The report has found the Government has a "moral obligation" to thalidomide survivors

The report has found the Government has a "moral obligation" to thalidomide survivors It has recommended a lump sum payment and ongoing disability support be provided

It has recommended a lump sum payment and ongoing disability support be provided The Government had previously argued it held no responsibility over the tragedy

The Senate committee report examined whether the Government should play a greater role in providing financial support to those affected by thalidomide.

The thalidomide drug was widely sold in the late 1950s as a treatment for anxiety, insomnia and morning sickness, but caused birth defects in unborn babies.

Some people affected by thalidomide have been born without limbs and with damage to the nervous system, kidney and heart.

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The report found the Government had a "moral obligation" to offer support to those affected by the drug, because it failed to recall the product from pharmacies once the damage being done by the drug was clear.

"If the Australian Government had acted more swiftly, it has been estimated that approximately 20 per cent of Australia's thalidomide survivors may not have been affected," the report said.

The report recommended the Government apologise to survivors and their families and provide all survivors recognised by the company responsible for the drug with a lump sum payment.

It also recommended ongoing annual payments be provided to survivors which "should be increased over time to reflect thalidomide survivors' increasing needs".

The drug was sold as Distaval in Australia and used for morning sickness. ( Australian Story: Anthony Frisina )

The Australian Government had previously argued it was not required to offer support to thalidomide survivors because it was not responsible for the tragedy.

Bipartisan support for apology

A spokesperson for Health Minister Greg Hunt said the Minister had previously committed to offering a national apology and establishing a memorial for thalidomide survivors and victims.

"The agony of thalidomide sufferers has been a national tragedy," the spokesperson said.

"The Government welcomes the report and will consider all remaining recommendations that have not already been addressed.

"While not pre-empting the final outcome, the Minister was the first person in Government to offer the victims a long-overdue national apology and has deep compassion for their lifelong suffering."

Opposition Leader Bill Shorten has also supported the call for a national apology, which he said should recognise the intergenerational impact of thalidomide on Australian families.

"It would demonstrate that the Parliament recognises the harm these injuries have caused and that survivors and their families require more support in the decades to come."

Mr Shorten met with thalidomide survivors today and committed to set up a compensation scheme if Labor wins power this year.

"Not just payments like a pension … but recognition that the Government did something wrong," he said.

Survivors 'delighted' by recommendations

Thalidomide survivor Lisa McManus has been lobbying politicians for the past five years over the issue and said the recommendations had exceeded the expectations of the thalidomide survivor community.

"We are just delighted … we just couldn't be any more happier than what we are right now," she said.

"Wrongs were done and an apology is a huge step forward to righting some of those wrongs, so they absolutely have made a huge recommendation that an apology be made to ourselves and our families.

"[Politicians] can't ignore what has happened, we feel confident that the Government will do the right thing by us — we have to feel confident, because we're at this point right now."

The report further recommended the Government investigate the possibility of other concessions and funds to support survivors with their disabilities.

West Australian Greens senator Jordan Steele-John, who pushed to establish the Senate inquiry, said the recommendations were a "blueprint for justice".

"After decades of failure and silence by governments of all colours it's time for the action and acknowledgement survivors demand," he said.