TONY JONES, PRESENTER: The Salvation Army has confirmed it's received nearly 500 complaints of child sexual abuse at its orphanages around Victoria. The organisation says it's paid out between $15 million and $20 million in compensation, but denies paedophilia was endemic. However, Victoria's state child abuse inquiry heard the Salvos haven't reported a single complaint to police and that their records almost certainly underestimate the total number of child abuse cases. Danny Morgan reports.

DANNY MORGAN, REPORTER: Alf Stirling was subjected to horrific sexual and physical abuse as a teenager at a Salvation Army-run home at Bayswater in the 1950s.

ALF STIRLING, CARE LEAVER: Still affects me today. I sleep with an axe and a big hunting knife under my bed.

DANNY MORGAN: It's clear he was one of many to be assaulted.

MALCOLM ROBERTS, SALVATION ARMY: In Victoria, we have received 474 abuse claims. 470 arise out of children's homes.

DANNY MORGAN: The perpetrators were often sworn Church officials, trusted to run more than a dozen homes around the state.

MALCOLM ROBERTS: So 50 officers have been named. Out of those 50 officers that have been named, 37 are dead, and of the ones that remain, there's three or four that are in jail.

DANNY MORGAN: The Salvation Army admits the number of victims and offenders is likely to be much higher than its official figures show.

MALCOLM ROBERTS: Our record keeping by today's standards is appalling.

DANNY MORGAN: And out of all the complaints, not one has been reported to police.

MALCOLM ROBERTS: It isn't our responsibility.

DANNY MORGAN: Despite the sheer number, the Church has never conducted an internal investigation into what went on and it denies senior officers at the time knew about the abuse but turned a blind eye.

ALF STIRLING: They knew. They couldn't tell me they still don't know what went on.

BRIAN CHERRIE, CARE LEAVER: They knew damn well what was going on. There were just no checks and balances.

MALCOLM ROBERTS: The Salvation Army is ashamed of the treatment many children placed in our care in children's homes received. This should not have happened.

DANNY MORGAN: The inquiry today also heard from the scouting movement. It's had 36 complaints of abuse in Victoria since 1962.

Danny Morgan, Lateline.