The investigation into the RAAF's program to replace fuel tank sealant on Australia's ageing F-111 strike aircraft has found an extra 2,000 defence personnel should be offered ex gratia payments.

A compensation scheme was established four years ago for personnel who worked on the jets' fuel tanks, but the parliamentary committee inquiry found the scheme was too limited and that it excluded hundreds of personnel who had legitimate claims.

Committee chairman, Labor MP Arch Bevis, says the compensation scheme was "born of fuzzy logic, shrouded in misleading spin and then administered in confusion".

The report made 18 recommendations which the Government is now considering.

Australia acquired its F-111 strike fighter fleet in 1973 and almost instantly discovered a major problem with their fuel tanks; specifically the sealant used disintegrated quickly.

Unlike other aircraft which had simple fuel tanks or bladders, the F-111 stored fuel, as Liberal MP Stuart Robert explained, everywhere - in every nook and cranny.

And to fix the leaks defence sent personnel into those confined spaces without protection.

"RAAF men were sent inside the smallest nooks and crannies imaginable in F-111 aircraft and in 1973 out on the tarmac there were no sheds, no covers," Mr Robert said.

"In scorching heat in an Amberley summer these men would crawl in, many of them in shorts and T-shirts with no personal protective equipment, to carefully pick off the sealant and trace where the hole was and then to reseal it."

The program became known as "de-seal/re-seal". The crews were dubbed "pick and patch" workers.

The scheme operated for nearly 20 years and hundreds of workers were exposed to the harsh chemicals.

Five years ago an ex gratia scheme was established, paying some personnel $10,000 or $40,000 based on their working conditions and not on the subsequent health problems they experienced. Two-thousand people missed out.

Health impact

An earlier health study showed the de-seal/re-seal workers had a 44 per cent higher rate of cancer than the rest of the population.

A second parliamentary inquiry into the program was established last year. Its findings were published today.

Committee chairman Arch Bevis says compensation should be offered to the 2,000 people who missed out.

"The exclusion from the scheme of about 2,000 personnel who undertook pick and patch work in the squadrons whilst providing benefits to those doing identical work in other units caused understandable anger," he said.

"In addition the 2005 scheme provided payments to people who reported no ill health effects at all whilst denying the same benefits to workers whose health had suffered. That simply aggravated the anger."

The committee has made 18 recommendations, including that families and workers be offered group counselling and that Defence hire more occupational medicine specialists.

As Mr Bevis highlighted, a similar recommendation made eight years ago has been ignored.

"Today, amazingly Defence has only one person, one person engaged full-time on that vital task," he said.

"How can that be when we hear so often that our men and women are our greatest asset? And indeed they are. Yet eight years after the board of inquiry said Defence needed to improve the delivery of services in occupational health and safety and to have appropriately qualified medical officers, there is one full-time in the entire ADF."

And he had damning words for the Department of Veterans' Affairs (DVA).

Mr Bevis said staff had a callous disregard for workers affected by the de-seal/re-seal program and he recounted one such case today.

"This particular gentleman had sought access to the ex gratia scheme. He along with others had suffered both physical and mental health issues. He was in hospital on suicide watch when the Department of Veterans' Affairs thought it would be opportune and appropriate to advise him that his application had been rejected," he said.

"Mr Deputy Speaker, it astonishes all of us that the considered view of DVA could be to provide that quite shatteringly bad advice to a former RAAF officer when he was on suicide watch in a hospital. There is a need for the DVA to review its training procedures and the committee makes recommendations accordingly."

Cautious welcome

The President of the F-111 De-seal/ Re-seal Support Group, Ian Fraser, says the report goes some way towards reducing a blight on Australia's character caused by the ill-treatment of the affected workers.

He is pleased that more of the victims have been recognised, but he says their avenues for compensation remain inadequate.

"I applaud many of the recommendations from this report. A great number of them are ones that we sought; to be more inclusive, the other workers who performed pick and patch duties, the abolition of cut-off dates that prevented widows from receiving payments," Mr Fraser said.

"One of the core disappointments though is ... not enough has been done around compensation issues.

"One of the things that we had hoped for would have been a recommendation for a mediation process so that each of us have a chance to present our cases to receive access to fair and equitable compensation.

"The only people that get any compensation out of those sort of processes are lawyers.

"This country was built on the good old Australian fair go and for us that just hasn't happened."