Calling it a "national tragedy", the government will ask the Australian Law Reform Commission to examine why Indigenous Australians are jailed at a higher rate than other groups.

"It is a sad reflection on Australia that our first peoples are so grossly over represented in our nation's prisons," said Attorney-General George Brandis.  "I have decided to make a new reference to the Australian Law Reform Commission, to ask them to examine the incarceration of Indigenous Australians, and to consider what law reform measures can be put in place to help ameliorate this national tragedy," he added.

Despite making up about two percent of the nation's population, Indigenous people account for 27 percent of prison inmates - and that's up from 19 percent in 1991.  Indigenous children and teenagers are 24 times more likely to end up in prison than their non-Indigenous peers while Indigenous women are 30 times more likely to end up behind bars.  "Those statistics of course paint a stark picture," said Senator Brandis.

Australian Bar Association president Patrick O'Sullivan agreed that the disproportionate incarceration rate for Indigenous Australians is a "national disgrace", and hailed the announcement as "a significant opportunity to make informed and practical changes that address this problem and delivers better justice outcomes for Indigenous Australians and the country as a whole".

West Australia has the highest rates of Aboriginal incarceration in the country.

The government's decision to pursue an inquiry follows the decision to call a royal commission into the Northern Territory juvenile justice system after the ABC's Four Corners investigation showed mistreatment of Indigenous youth at Darwin’s Don Dale youth detention centre; and it comes 25 years after the final report of the Royal Commission into Aboriginal Deaths in Custody.