But Health Minister Tony Abbott's call on Wednesday for a new "paternalism" prompted a backlash from opposition parties, who accused him of turning the clock back to racist policies of the past.
As a new report showed indigenous Australians continued to die 20 years earlier than the rest of the population, Abbott said the policy of allowing Aborigines to run their own affairs had clearly not worked.
"The fundamental problem here is not lack of spending, although it could always be higher, but the culture of directionlessness in which so many Aboriginal people live," Abbott said.
He acknowledged the British settlement of Australia in the 18th century had been a tragedy for hundreds of thousands of Aborigines, who were driven off their lands and killed.
But he insisted political correctness and a fear of being regarded as racist must not stop the government tackling the "gothic horror" of lawlessness, domestic abuse and alcoholism afflicting many remote Aboriginal communities.
Many Aborigines live in squalid
camps where abuse is rife
"Australians' sense of guilt about the past and naive idealisation of communal life may now be the biggest single obstacle to the betterment of Aboriginal people," Abbott said. "Someone has to be in charge."
The minister said an official report last year on the running of five Aboriginal townships in Queensland "shows why a form of paternalism - paternalism based on competence rather than race - is really unavoidable if these places are to be well run."
His speech provoked an outcry from political opponents, who said the government wanted to return to the days when Catholic missions ran many Aboriginal townships.
Australian Greens leader Bob Brown accused the staunchly Catholic health minister of suffering from "missionary zeal".
Bob Brown (L) accused the health
minister of 'missionary zeal'
"It's just extraordinary that Tony Abbott thinks he is the father of the Aboriginal people of Australia," Brown told reporters.
"He should consult the Aboriginal people and make sure they are in the decision-making all the way down the line."
The Labour Party said Abbott's call evoked the dark days of an assimilation policy, in which hundreds of Aboriginal children were forcibly removed from their homes and placed with white families.
A government report into the so-called "stolen generation" released in 1997 found that the practice, which was only phased out in the 1970s, was racist and amounted to an attempt at genocide.
Chris Evans, Labour's indigenous affairs spokesman, said: "What we know of 200 years of Australian history is that paternalism didn't work.
"What we know of 200 years of Australian history is that paternalism didn't work. Paternalism is what saw the black children taken away from their parents"
Chris Evans, spokesman for
Labour's indigenous affairs
"Paternalism is what saw the black children taken away from their parents."
Aborigines have lived in Australia for at least 40,000 years.
But they are now a minority with a population expected to reach 470,000 this year.
Many live in squalid outback camps where unemployment, alcohol dependency, and abuse of children and women is endemic and lawlessness is rife.
A report compiled by the charity Oxfam this year found that the health of Aboriginal Australians lagged far behind that of indigenous people in other developed Commonwealth nations.
The report by the Australian Institute of Health and Welfare published on Wednesday painted a grim picture of Aboriginal health and lifestyles.
Seventy per cent of indigenous people died before the age of 65, compared with only 20% of other Australians.
The death rate of indigenous children remained three times higher than other Australians, the report added.
The government has criticised so-called "self-determination" in Aboriginal communities in the past, saying it had failed because of entrenched corruption, nepotism and incompetence.