Indigenous Affairs Minister Nigel Scullion has resisted calls for the federal government to add an imprisonment target to the Closing the Gap strategy.
The ninth annual progress report showed only one of seven targets set down to improve indigenous health, education and employment outcomes is on track to be met.
But the Northern Territory senator says it's largely the responsibility of the states.
"More than half the targets are entirely in the realm of the states and territories, so COAG needs to be at the front and centre," Minister Scullion said in Arnhem Land on Thursday.
NT Chief Minister Michael Gunner has called for the federal government to rejig the targets, which end in 2018, in order to properly combat Aboriginal disadvantage.
He wants them revised to include incarceration, housing and economic participation targets.
But while Senator Scullion said Canberra would look at refreshing action plans, he thinks states and territories should put in place their own justice targets.
A royal commission into juvenile justice in the NT is under way following abuse scandals, and another inquiry is set to examine the over-representation of indigenous Australians in prisons.
Minister Scullion indicated the Coalition would provide financial assistance to the NT government when the youth justice inquiry's final report is delivered in August.
"Of course, we've asked for this (commission) to be put in place... we'll work out a plan to implement the recommendations," he said.
