This article is more than 11 years old

This article is more than 11 years old

The Australian prime minister accused arsonists of "mass murder" today as the death toll from the deadliest bushfires in the country's history reached 135. Officials in Victoria believe some of the 400 fires that reduced towns to blackened ruins may have been deliberately set, or have been helped to jump containment lines. The incinerated towns have been officially declared as crime scenes.

The prime minister, Kevin Rudd, announced a $10m (£4.5m) emergency relief fund and said: "Hell in all its fury has visited the good people of Victoria ... many good people now lie dead."

Speaking about the fears that arson could have played a part, he said: "What do you say about anyone like that [an arsonist]? There's no words to describe it, other than it's mass murder.

"This is of a level of horror that few of us anticipated."

Mike Rann, the South Australian premier, described the arsonists as "terrorists" and "the enemy within".

Authorities said the number of people known to have died would almost certainly rise as they reached deeper into the disaster zone, while forecasters warned that temperatures would rise again later in the week, raising the possiblity of further flare-ups. At least 80 people were in hospital with burns.

"I think it [the body count] will be up into the 100s ... 200," acting Sergeant Scott Melville told the Melbourne Age. "It's like a war zone up here ... it's like a movie scene."

Police have sealed off Marysville and Kinglake, where dozens of people died, setting up roadside checkpoints and controlling access to the area. Outside Marysville, residents who fled and news crews were told they could not enter because there were still bodies in the streets.

The Victoria police commissioner, Christine Nixon, said specialist fire investigators were at Churchill, east of Melbourne, and had strong suspicions that the blaze there had been started deliberately.

Kinglake saw the biggest loss of life, but "wherever a death occurred we investigate that as a crime", she told ABC radio.

Victoria's premier, John Brumby, broke down, saying: "It is just a day I hope in my lifetime I never see repeated."

The state has roasted in extreme temperatures – the highest in 70 years – for a fortnight, with the fires driven by hot winds of more than 60mph.

Officials said panic and the speed of the firefront probably accounted for the unusually high death toll, which have made this the country's worst natural disaster in more than a century.

Many tried to escape the acrid smoke in their cars, but some did not make it as trees exploded and blocked their path.

Nixon said it appeared some people had simply run out of time. "We're finding [bodies] on the side of roads, in cars that crashed," she told a news conference.

John Handmer, a wildfire safety expert at the Royal Melbourne Institute of Technology, said research had shown that people in the path of a blaze must get out early or stay inside until the worst has past.

"Fleeing at the last moment is the worst possible option," he said. "Sadly, this message does not seem to have been sufficiently heeded this weekend with truly awful consequences in Victoria."

ABC radio told of a car seen in a small reservoir, after the driver apparently steered there in desperation.

The Victoria Country Fire Service said some 850 square miles (2,200 kilometres) were burned out, with entire forests reduced to leafless, charred trunks.

The army has been called in to help thousands of exhausted firefighters as more than a dozen fires still burned uncontrollably across the state.

Fifty fires were also raging across New South Wales, where temperatures reached 46C (115F) yesterday.

Survivors said the devastated areas looked as though they had been hit by a nuclear bomb, and those who had started the blazes "must pay".

Brumby said a royal commission, among the highest-level investigations that can be called under Australian law, would be held.

A former judge is usually appointed to take extensive evidence and make formal findings that can lead to charges or changes in the law.

Anyone found guilty of lighting a wildfire causing death faces 25 years in prison in Victoria, but a murder conviction could result in a life sentence, the federal attorney general, Robert McClelland, said.

From the devastation, stories of survival began to emerge. Nine Network television reported that one woman, Nesh Sinclair, sheltered with her children in the burrow of a wombat as the worst of the fire passed.

Survivors scoured lists compiled by the Australian Red Cross at 20 emergency relief centres, looking for missing relatives. More than 4,000 people had registered themselves with the agency.

Parliament suspended its normal sessions today to hear condolence speeches by legislators, many of them speaking in voices that quavered with emotion.

Gordon Brown told Rudd the UK was ready to help Australia, and the Queen offered her condolences to the bereaved families.

A veteran television newsreader, Brian Naylor, and his wife were among the victims. A firefighter's family died as he tried to protect the residents of another fire-ravaged town.

Mary Avola, from Strathewen, 30 miles north-east of Melbourne, described how she and her husband, Peter, had attempted to flee their endangered home on foot.

The 67-year-old told her to go on ahead, and she has not seen him since.

"He was behind me for a while," she told the Age. "He just told me to go, and that's the last time I saw him."

Residents of the worst-hit areas of Victoria told of the extraordinary speed at which the fires travelled and said they feared there "was not going to be a tomorrow".

A thick blanket of black ash blotted out the sun, leaving a "horrible orange glow", one resident said, adding: "It rained fire."

Others described how flames four storeys high raced across the land, wiping out towns within an hour.

The alpine town of Marysville was flattened street by street.

Witness Victoria Harvey told the Australian Associated Press that a businessman watched as a car in which his two children were sheltering went up in flames.

"He put his kids in the car, turned around to go grab something from the house, then his car was on fire with his kids in it and they burned," she said.

Jack Barber said he fled his house in Pheasant Creek with his wife and a few belongings on Saturday and spent the night on a sports field dodging flames before driving out of the disaster zone on Sunday.

"There were dead horses, live horses, kangaroos bouncing down the road with flames at their back. It was horrific," he said.

Jim, from Tanjil South, was seeking refuge in his swimming pool as embers dropped in the water around him.

He told ABC radio it was "as dark as midnight" and "we can smell the fire ... we're still in the pool here and we can hardly see here, it's so dark".

At least 750 homes have been destroyed and more than 330,000 hectares of land burnt. The authorities said some fires could take weeks to contain.