Indonesia will investigate atrocities including the East Timor slaughter after agreeing on a truth and reconciliation commission.

Parliament agreed to set up the panel yesterday after a three-month row sparked by the military's objection to the inclusion of "truth" in its title.

One atrocity the generals want to stay buried are the events that led to the 1965 army-backed coup that installed the dictator Suharto and led to a purge of up to one million communists – immortalised in the film The Year of Living Dangerously.

The massacre and torture of thousands of unionists and Left-wing government critics is not mentioned in Indonesian history and remains shrouded in mystery. Others incidents include the systematic suppression of opposition during Suharto's 32-year rule.

"If we want to disclose everything for the sake of mere truth, it will prevent us from real reconciliation," army major-general turned politician Djasri Marin told parliament in July.

The commission, which opens next year, will be based on a similar body established in South Africa following the end of apartheid.

But critics said the 21-member commission would be largely toothless and unlikely to change Indonesia's woeful record on punishing those responsible for human rights crimes.

The commission could recommend court action against those who refuse to apologise after proof of involvement in atrocities.

But it could also recommend amnesty if the victim refuses an apology, possibly allowing military and police members to escape punishment.