A $99million First Nations Justice package to deliver much-needed reforms was a key element in the federal budget announced on Tuesday.

The first budget of the Labor government elected in May includes a focus on justice reinvestment.

The bulk of the funding, $81.5 million, will be invested in up to 30 community-led justice reinvestment initiatives across the country and in the establishment of an independent national justice reinvestment unit.

The establishment of this unit was recommended by the Australian Law Reform Commission.

In a statement, the government acknowledged that the rates of incarceration and the number of deaths in custody of Aboriginal and Torres Strait Islander people, more than 30 years after the Royal Commission into Aboriginal Deaths in Custody, are "a national shame".

The package also includes $13.5 million in additional funding to Aboriginal and Torres Strait Islander Legal Services to increase its capacity to provide culturally appropriate legal assistance in coronial inquiries; $1 million to build greater capacity in the National Aboriginal and Torres Strait Islander Legal Services; and $3 million to support the National Family Violence Prevention Legal Services Forum, and the family violence prevention legal service providers who deliver legal assistance and non-legal support to victim-survivors of family and domestic violence and sexual assault.

Minister for Indigenous Australians Linda Burney said ongoing and meaningful change is needed.

"This is why we are investing in justice reinvestment initiatives with up to 30 communities across Australia and increasing funding to Aboriginal and Torres Strait Islander Legal Services," she said.

"Justice reinvestment will need to be community-led and include holistic approaches to keep Aboriginal and Torres Strait Islander people out of the criminal justice system.

"These commitments will enable Aboriginal and Torres Strait Islander people to contribute to decisions that will benefit us and our communities."

Attorney-General Mark Dreyfus said Aboriginal and Torres Strait Islander people are "tragically over-represented at every point in the justice system".

"Turning the tide on the unacceptably high rate of incarceration and deaths in custody is a key priority of this package," he said.

"The voices of Aboriginal and Torres Strait Islanders are critical to achieving the justice targets under the National Agreement on Closing the Gap."

Social Reinvestment WA executive manager Sophie Stewart said the campaign was very pleased to see the federal budget living up to the Labor's election commitments on justice reinvestment, and crucially that community led justice reinvestment initiatives will be supported by an independent national unit.

"We believe this $81.5 million has the potential to go a long way for communities around our state who are desperate for new approaches to build safer communities and provide better outcomes for struggling individuals and families," she said.

"It's time for our government to move away from punitive and ineffective, tough on crime responses towards self-determined solutions created in partnership with Aboriginal and Torres Strait Islander people and local communities."

Greens First Nations spokesperson, Gunnai, Gunditjmara and DjabWurrung Senator Lidia Thorpe, welcomed the funding and said work to implement all of the recommendations from the Royal Commission into Aboriginal Deaths in Custody was "urgent and overdue".

"Around 40% of the Commission's recommendations are about social factors, because access to basic human rights will prevent First Nations people from entering prison in the first place. Labor's investment in First Nations health, housing and education is a positive step forwards," she said.

Senator Thorpe described justice reinvestment as "when we build communities instead of prisons".

"I'm looking forward to Senate Estimates to dig into the details. This is an opportunity to move forward as a united country. I'm keen to keep working with this government, to ensure they deliver on their commitments."

National Indigenous Times has contacted the North Australian Aboriginal Justice Agency for comment.