Abbott has ordered an urgent inquiry into the circumstances surrounding the tragedy and why deranged self-styled Islamic cleric Man Haron Monis was not under surveillance given his history of extremism and violence.
The Iranian-born 50-year-old was on bail for a string of charges, including sexual offences and abetting the murder of his ex-wife.
"This has been a horrific wake-up call," Abbott told Macquarie Radio when asked if this was an incident waiting to happen, amid criticism that various authorities failed to act to take Monis off the streets.
Monis, who was well known to authorities but was not on any counter-terror watchlists, took 17 people hostage at a cafe in the heart of Sydney on Monday, unfurling an Islamic flag during a 16-hour siege.
He was killed along with two victims -- the cafe's manager, 34, and a 38-year-old mother-of-three -- in a bloody end to the standoff.
Details of why police moved in when they did are sketchy but the father of a hostage who escaped said it was triggered by a group of them deciding they would "not survive until the morning if they did not do something".
"And at that point in time, Joel and five others came to the conclusion that they were not going to survive until the morning if they did not do something," he told Fairfax Media, adding that they decided to kick down an internal door.
"And I know that Joel made sure that Harriette (Denny) ... Got behind him and he said, 'You're coming with me', and basically made sure that all that group were ready to go when Joel and Jarrod (Hoffman) broke down the door."
Abbott has kept a high profile through the siege drama but has come under criticism from some quarters, notably about his decision to release details of a huge blow-out in the budget deficit as Australia was gripped by the unfolding Sydney events.
Influential broadcaster Ray Hadley, who has long backed Abbott and his conservative Liberal Party, told him during a face-to-face interview he rated his performance as "D-", saying going ahead with the budget outlook was "a really poor call".
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