A little-known budget measure that strips the criminally insane of welfare could put the community at risk, an advocate warns.
From July 2015, the disability support pension will no longer be paid to people with severe mental illnesses who are detained for serious crimes, including murder.
The little-publicised $30 million savings measure was included in the mid-year budget review.
AAP understands it will affect about 300 people confined to psychiatric units or living in the community because they are unfit to stand trial, or cannot be convicted because they cannot judge right from wrong.
There are concerns the measure will put the broader community at risk because people considered a danger will be left to fend for themselves.
The Aboriginal Disabilities Justice Campaign warns they face increased homelessness, poverty and an inability to access social services because of their unfitness for work.
"We want these people to be properly supported so that they don't hurt people," co-ordinator Patrick McGee told AAP on Tuesday.
"One of the ways we support them is their having access to the DSP."
Mr McGee represents a Northern Territory man who can't be convicted of the murder of his uncle because of severe mental incapacity.
The man is being moved from a correctional centre to a care facility and will need to pay for food, accommodation and transport.
"But he will now have no income to do so," Mr McGee said.
"He can't go out and go shopping; he can't even communicate."
Mr McGee is concerned the government is sending contradictory messages, telling the mentally-ill their use of violence is related to their disability, while revoking their support.
The federal government says the measure ensures the same treatment for people in the criminal justice system whether they reside in a psychiatric or penal institution.
Comment has been sought from the Social Services Minister Scott Morrison and his department.
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