Veterans, researchers and the union want the royal commission into veteran suicide to look into the role the public service plays in catching people at risk.
The announcement that the inquiry would begin by July was welcomed across the ex-service community on Monday, although details were scant.
The royal commissioner will look at the past, while the national commissioner for veteran suicide prevention - a permanent role in the Attorney-General's portfolio - will look to the future, Prime Minister Scott Morrison said on Monday.
That did not stop the public sector union calling for the inquiry to investigate "crippling wait times" for clients of the Department of Veterans' Affairs linked to staffing caps that remain at 2007 levels, despite client numbers increasing.
"Our members are proud to work hard every day helping our veterans, but there just are not enough workers to get the job done," said Brooke Muscat, the CPSU deputy national president.
The union says privatisation of the department has led to a backlog of claims older than 450 days yet to be processed, and payments can take up to five months due to understaffing in other areas of the organisation.
"We know there will be many recommendations from such an important royal commission, and we also know access to services for veterans is a large part of the challenge," Ms Muscat said.
More than 300 staff have written to the Prime Minister and Veterans' Affairs Minister Darren Chester urging the government to lift the staffing cap.
Loretta Somerville from The Warrior's Return said officials in Veterans' Affairs and Defence needed to be held accountable for veterans being left isolated after they leave the Defence Force.
"They're just left to flounder, and their families have to pick up the pieces," Ms Somerville said.
At least 23 suicides this year have been linked to veterans of Australia's modern wars in Afghanistan and Iraq.
Male veterans are 21 per cent more likely to die by suicide than men generally, according to the latest monitoring reports from the Australian Institute of Health and Welfare. The rate of suicide among ex-serving women is twice as high as among women in general.
Julie-Ann Finney has led a campaign for a royal commission following the death of her son. She says the voices of veterans have to be the focus of the inquiry.
"Finally the voices of veterans will be heard, and finally families can stand up and share their stories," Ms Finney said.
"We cannot have the organisations at the centre of a broken system leading this investigation."
A petition started by Ms Finney for a royal commission was signed by more than 409,000 people. Her campaign drew support from across Parliament, including many in the government.
Scott Morrison relented on Monday, announcing the royal commission would work in conjunction with his permanent commission of inquiry run by ACT magistrate and army brigadier Dr Bernadette Boss.
The Prime Minister did not name who would helm the royal commission, but indicated a tentative starting time of July with a final report due in between 18 months and two years.
"I think and I hope it will be a healing process ... that will assist in the comfort that those families have been seeking," Mr Morrison said.
The Prime Minister said governments make difficult decisions to deploy soldiers into war zones, but they also need to consider what happens to soldiers when they return home.
"There is a far greater cost that is borne beyond those deployments, and that is the mental toll taken on the veterans after they return," he said.
"That cost is most significant when we see it in the death by suicide of our veterans."
Labor's defence spokesman, Brendan O'Connor, welcomed the decision.
"We have had 41 tragic deaths in the Afghan war during the time of battle which is, of course, a great tragedy," Mr O'Connor said.
"It has been reported that over 500 veterans have suicided in that same time period, more than a tenfold increase than those who tragically died at war during the Afghan war.
"I think that underlines why it is so important that we see this matter dealt with."
Dr Boss has already conducted 18 forums with veterans and families about their experiences. She plans to share those notes with the commission as she continues to look at systemic failures.
"I am committed to holding to account any party that fails to implement recommendations made to address this difficult issue, as well as testing and, where necessary, working to adjust any recommendations that do not have the desired outcome to address defence and veteran suicide," Dr Boss said.
Lifeline: 13 11 14
Open Arms - Veterans and Families Counselling (for current and former serving ADF members and their families): 1800 011 046
Soldier On Australia: 1300 620 380
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