The Howard government put the so-called Northern Territory Emergency Response in place in 2007 after declaring that violence and abuse of children in Aboriginal communities was a national emergency.

The Rudd government has continued the tough-love approach, but Ms Macklin’s rewrite of the legislation that created the NTER delivers on her promise to make the measures compliant with the Racial Discrimination Act.

Her new laws will retain all elements of the NTER, some with minor changes, with the government insisting they qualify as exemptions under the act because they are aimed at benefiting a particular racial group.

But on income-management, Ms Macklin’s solution to make it comply with the RDA is to extend it nationwide.

“It will be a non-discriminatory approach,” the Indigenous Affairs Minister told The Australian last night.

“There are a number of people around the country who will benefit from income management.

“It doesn’t have anything to do with whether they are Aboriginal people.”

She said income management was clearly helping disadvantaged Northern Territory communities, with families spending more on food and communities becoming more peaceful.

Under the changes, the existing income-management system in operation in the Northern Territory, as well as in trials in Cape York and parts of Western Australia, will continue until next July.

But in the first step of a national rollout, the new scheme will apply to those existing areas until the end of 2011, after which they will be assessed for their effectiveness.

The measures will then go national.

The new legislation will allow Ms Macklin to activate income-management measures by declaring any area subject to disadvantage.

When activated, the restrictions would apply to people aged 15 to 24 years in receipt of specified welfare payments for more than three of the previous six months, people aged over 25 on payments such as Newstart Allowance and Parenting Payment for more than one year in the previous two years and people assessed by Centrelink social workers as requiring income management because of vulnerability to financial crisis, domestic violence or economic abuse.

Measures linking income management to child protection and school attendance, which have been trialled on Queensland’s Cape York and in parts of WA, will also be part of the new scheme.

Exemptions will be available for some welfare recipients if they can demonstrate responsible behaviour. For example, young people will be able to apply for exemptions if they are in full-time study or training or are engaging in paid work, as will parents who can demonstrate they are ensuring their children attend school or, for non-school-age children, are up to date with childhood immunisations.

Long-term dole recipients without children could receive exemptions if they have a history of engaging in work, even if it is not permanent work.

Ms Macklin said the new scheme would be supported by financial counselling and money-management services worth $53 million over four years.

There will also be incentives for people who complete the money-management courses, including up to $500 for household goods such as refrigerators. She also said elements of the NTER would continue, including alcohol and pornography restrictions, which she said had improved life in communities, particularly for children.

Five-years leases over indigenous land would also remain in place along with licensing of community stores and special law enforcement powers.