Morrison Said He's Thankful Nobody Died In Kangaroo Island Bushfire That Killed Two

Prime Minister Scott Morrison was corrected by locals on Kangaroo Island on Wednesday after telling them he was thankful nobody died.

Standing in a group and speaking quietly, Morrison told residents of the fire-ravaged island: "Well thankfully, we've had no loss of life".

"Two," one person responded. "We've had two."

Looking to another person for confirmation, he quickly backtracked, claiming he meant first responders, not locals.

"Two. Yes, two, that's quite right," he said. "I was thinking about firefighters firstly."

Father and son Dick and Clayton Lang, a bush pilot and plastic surgeon respectively, lost their lives when the massive blaze tore through the island on January 3 - two weeks after it first broke out.

The pair were returning to their family home after spending the past two days fighting a nearby fire.

Dick was found in a burnt-out car near Parndana, while his youngest son was found 200 metres away, on the highway.

A spokeswoman for the Prime Minister's Office said Morrison had been having a conversation about the firefighting efforts when he made the comment.

"He was aware of the two deaths and met with one of the relatives of those who were killed while on the Island," he said.

"The PM noted he was aware of this in his response and has previously expressed condolences for the devastating loss of life on Kangaroo Island," she said.

Morrison visited Kangaroo Island on Wednesday, where he spoke with business owners and made a plea to the nation's tourists to continue holidaying, and announced a mental health package for bushfire victims.

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Australian Defence Force psychologists have been deployed across the country to help victims in fire-ravaged areas.

The prime minister confirmed Health Minister Greg Hunt was working on a mental health package.

Federal Emergency Management Minister David Littleproud and the head of the newly-established bushfire recovery agency, Andrew Colvin, are expected to visit Victorian fire-affected communities of Tumut and Sale on Thursday.

Mr Littleproud has indicated he'll announce a bushfire support package for small businesses, including interest-free loans of up to $500,000 that are repayment-free for two years.

Twenty-six people have been killed, millions of hectares have burned and thousands of homes destroyed this bushfire season.

Firefighter organisations have called for a federal royal commission into Australia's bushfires, days after Mr Morrison said he'd consider one.