The Northern Territory's largest Indigenous legal organisation says whichever party wins the upcoming election needs to prioritise diversionary options in order to reduce the NT's reliance on prisons.

Both major parties in the upcoming election have preached their bona fides surrounding law and order, with Labor promoting the largest police funding in the NT's history, whilst the opposition CLP have vowed to bring back spit hoods in juvenile detention and reverse the decision to forbid the incarceration of 10 and 11-year-olds.

This week, the North Australian Aboriginal Justice Agency (NAAJA) said raising the age of criminal responsibility to 14 years and reversing previous bail reforms that have "contributed to an explosion in the prisoner population," were on their election wish list for whoever wins on August 24.

They also called for definitive action to reduce the number of children in contact with child protection, arguing policymakers needed to "adopt smarter policy measures to address reoffending, community safety, and improve the justice system".

"The Northern Territory has a justice problem," NAAJA Principal Legal Officer Jared Sharp said.

"The upcoming election presents a landmark opportunity to press the reset button on how we, as a society, support individuals out of a cycle of offending and make our communities safer.

"This cannot be achieved by simply funding more police and more prisons."

According to the latest Closing the Gap data, First Nations young people are incarcerated at a rate 42.9 per 10,00 people in the NT, the second highest rate in the country. Almost every young person in detention in the NT is Aboriginal and/or Torres Strait Islander.

The NT also locks up First Nations adults at the second highest rate nationwide at a rate of 3,029.2 per 100,000 Aboriginal and/or Torres Strait Islander adults — 17 times the rate of non-Indigenous adults.

There has been a 22 per cent increase in Territory prison numbers since 2018.

"NT locks up four times as many children as anywhere else in Australia," Mr Sharp said.

"Without increased investment in tackling disadvantage, poor housing, and health issues that impact our communities, Aboriginal people will bear the brunt of law-and-order policies that overlook the root causes of offending."

He argued while there was a public perception that youth crime was on the rise, youth justice lodgements had fallen for three straight years across the NT.

"The smarter way forward is to provide more support for young people by investing in services and programs that work, such as youth-specific drug and alcohol programs and trauma-informed residential rehabilitation programs as well as more diversion options facilitated by Aboriginal organisations," Mr Sharp said.

"We must also ensure that vulnerable children have access to high-quality, suitably trained, culturally competent, and impartial legal representation in child protection matters."

NAAJA have urged both parties to invest more in alternatives to prison, including adult diversion programs and increasing the levels of community work opportunities for offenders to offer them pathways to employment and training.

Furthermore, they have called for an amendment to bail laws, which they argue has "eroded the presumption of innocence, increased remand numbers, and prevented opportunities for intensive bail programs that assist rehabilitation prior to sentence".

NAAJA were critical of the increased police funding from the NT government announced earlier this year, and said the funding must be matched with investment in courts and legal services, including specialist Aboriginal legal services, to help manage the increased workload.

The legal organisation also highlighted child protection, arguing the system is failing Aboriginal children and child protection lodgements increased 50 per cent from the previous year.

"Just one quarter of Aboriginal children in out-of-home care are placed in a kinship placement," Mr Sharp said. "We must keep politics away from children."

"We must also prioritise the role of Aboriginal kinship carers in the child protection system to keep more Aboriginal children with family, aiming for a target of 75 per cent of children to be placed with kinship carers."