Amnesty International says disadvantaged indigenous people need local solutions, not the "failed" intervention policy being pursued by the federal government.
Federal Indigenous Affairs Minister Jenny Macklin on Tuesday said the government would continue the interventionist policies brought in by the Howard government in remote indigenous communities.
Releasing a new report, Stronger Futures in the Northern Territory, she also flagged a tougher approach to truancy and said parent's welfare payments would be linked to children's school attendance.
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The approach was criticised by indigenous elders and others living in so-called "town camps" where people live often in shocking poverty, sometimes without running water or reliable power supply.
Amnesty on Wednesday called on the government to work in partnership with Aboriginal communities to find practical solutions.
"I haven't seen anywhere in the world where quarantining people's money will help get children to school," said Rodney Dillon, an indigenous rights campaigner with Amnesty.
"The government must recognise that local issues need local solutions rather than the failed one-size-fits-all intervention policies that were imposed upon communities four years ago," Mr Dillon said.
Amnesty has worked with people in the Utopia homelands, a community about 260km northeast of Alice Springs, for the past three years.
Former prime minister John Howard adopted the intervention policy in 2007 after a report that highlighted alarming levels of child sexual abuse and neglect in remote Aboriginal communities.
The Labor government expects to have legislation in place to continue the intervention before the end of the year.
