Indigenous Affairs Minister Nigel Scullion is considering linking priority for social housing in remote areas to school attendance and employment.
Senator Scullion is calling for a radical overhaul of remote indigenous housing policies, and is negotiating an element of a national partnership agreement, which expires at the end of June, to do with packages of construction work.
He's keen to sign up the Northern Territory and state governments to bilateral deals and wants them to manage remote indigenous housing like public housing in metropolitan areas.
"If a state or territory is not up to the task, the commonwealth might have to step in," Senator Scullion wrote in an opinion piece penned for The Australian on Monday.
Rental agreements should be in place and enforced, rent collected and occupants liable for damage costs, he said.
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Jurisdictions must also provide adequate municipal services.
Senator Scullion has earmarked five conditions for bilateral deals including only building social housing in places that have land tenure arrangements for home ownership.
Mobility packages for people who move away for work are also on the cards.
He wants mainstream social housing rent rates set and priority for social housing given to families who have employed parents and children regularly attending school.
The head of Prime Minister Tony Abbott's indigenous advisory council, Warren Mundine, says the idea of linking housing to school attendance is a "no brainer".
"There has to be a radical change. I defy anyone to say the status quo is perfect," Mr Mundine told AAP.
But other factors contributing to school attendance also needed to be examined at the same time, such as school resources, bilingual education and indigenous culture and history classes, he said.
"You've got to look at the quality of education and resources too," he said.
Labor's indigenous affairs spokesman Shayne Neumann described the proposals as a "Nigel knows best paternalistic approach".
"The idea that you either get a benefit or are punished in terms of your right to public housing is a terrible message, it's unacceptable in a modern society," he told AAP.
Mr Neumann said the federal government should not be trading off the right to decent safe housing over education.
Senator Scullion had been silent over the NT government's $250 million cuts to education, Mr Neumann said.
He accused Senator Scullion of bullying communities to sign up to 99-year township leases.
