Federal Labor has been urged to follow the lead of its Northern Territory counterparts and return Binybara/Lee Point to the care of the Larrakia people.

The calls come as the federal government continues to remain silent on comments made last week by new NT Labor MLA Ed Smelt, who said the party had reversed its position on the controversial Defence Housing Australia (DHA) project and now opposes it.

The Binybara/Lee Point development masterplan covers 131 hectares and is planned to deliver about 800 homes. Land clearing for the first stage has already been completed. The area holds deep cultural and ecological significance, forming part of the Kenbi Dreaming track and providing habitat for the endangered Gouldian finch.

It was backed by Labor during their eight years in government between 2016 and 2024 — despite protests from Larrakia and environmental groups — and is supported by the federal government.

Laniyuk, a Larrakia woman from the collective Protect Larrakia Country — a group of young Larrakia people campaigning for the return of Lee Point to Larrakia ownership — said the shift by NT Labor should prompt federal action.

In 2024, Protect Larrakia Country delivered a petition to the NT Government and met with the Attorney-General, Marie-Clare Boothby.

Laniyuk said they asked Ms Boothby for an "immediate moratorium on clearing while the government works with and resources all eight Larrakia family groups to establish a Larrakia-owned entity to co-manage Lee Point and Casuarina Coastal Reserve with Parks and Wildlife NT, with the land eventually being returned to Larrakia ownership by 2030".

Calling Lee Point "sacred" and saying it should be protected for future generations, she told National Indigenous Times: "NT Labor now acknowledges our Elders and community were right to oppose this destructive project."

"The next step is to ask their Federal Labor colleagues to intervene so this vision for returning Lee Point to the care, ownership and protection of Larrakia people can be realised before more damage is done."

Speaking last week before the Nightcliff by-election — which saw Labor regain the seat it lost to the Greens at the last election — Mr Smelt said the party had changed its position on the project and was "very proud to do so".

"That was the feedback we had from the community, was that we didn't get that right in the last term of government," he said on ABC Radio.

On Tuesday, National Indigenous Times contacted the Minister for Defence Personnel, Matt Keogh — whose portfolio includes DHA — asking whether NT Labor's change in position would be reflected federally and whether there had been consultation between the federal and territory branches. The Minister's office did not respond before publication.

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Independent Senator Lidia Thorpe — who in 2024 tabled a petition in federal Parliament with more than 16,000 signatures calling for Binybara/Lee Point to be returned to the Larrakia people — said the federal government has "so far refused to listen to Traditional Owners" over the development and questioned whether it would be "willing to listen" to its Northern Territory counterparts.

"Larrakia Traditional Owners have opposed this project from the beginning and have not given consent for the destruction of their Country," Senator Thorpe told National Indigenous Times this week.

"The Albanese government should cancel this project and put a stop to the destruction of Binybara/Lee Point once and for all."

The development is currently halted while a legal challenge brought by Traditional Owner Tibby Quall proceeds.

Last year, the Northern Territory Civil and Administrative Tribunal (NTCAT) ruled that clearing at the site must stop until Mr Quall's challenge is resolved. The Larrakia Danggalaba Elder said the Heritage Council had ignored his earlier warnings about sacred sites and cultural artefacts in the area, including a grindstone and stone tools.

NTCAT ultimately found Mr Quall is an owner of the artefacts.

Asked about a timeframe for when the development may recommence, a DHA spokesperson told National Indigenous Times on Tuesday: "DHA is awaiting determination of one outstanding matter with the NTCAT, expected in April."

"This matter is in relation to one area within the Lee Point development and proceedings will not impact commencement of construction in areas outside of that scope later this year," the spokesperson added.