The Labour-led coalition government has this year been preparing to launch a royal commission into the historical abuse of children in state care, but on Monday announced the inquest would also cover those abused in the care of "faith-based institutions".

Since the initial announcement there would be a state inquiry, numerous survivors and organisations have publicly come forward, strongly urging the government to ensure it also covered churches.

"It was very hard to ignore the strength of feeling that came through ... We had to listen," Prime Minister Jacinda Ardern told reporters.

While several thousand people have already registered to give evidence, no precise figures have yet been established.

"Today paves the way for us to confront a dark chapter of our national history by acknowledging what happened to people in state care, and in the care of faith-based institutions, and to learn the lessons for the future," Ms Ardern said.

"We've got a moral duty here."

The New Zealand inquiry would have a broader criteria than Australia's, covering not just sexual abuse, but also other forms of abuse, Ms Ardern said.

It will be focused on cases between 1950 and 1999 and is expected to be the largest royal commission in the country's history.

The commission will be hearing evidence from January next year, with a final report due in early 2023. An interim report looking just into the state care component is due towards the end of 2020.

Australian Associated Press