Australia should create a seventh state run by Indigenous people, with its own parliament and court system, an Aboriginal lawyer and activist has proposed.

Key points: Suggested new state could be established on land already controlled by Aboriginal people

Suggested new state could be established on land already controlled by Aboriginal people Proposed new state would not require changing of constitution

Proposed new state would not require changing of constitution SA allocated $4 million for a "treaty commissioner"

Tasmanian Michael Mansell said statehood was the "ultimate prize" on the path towards self-determination and the new jurisdiction could operate like existing states.

"It would have power over raising taxes, over roads, electricity, education, health, housing and so on," Mr Mansell said.

"In other words, it would be handing full responsibility within the Australian federation back to Aboriginal people to make the best way that we can within federation."

The Palawa man has just published the book Treaty And Statehood and said the state could be established on land already controlled by Aboriginal people and without changing the constitution.

But he conceded it would not happen for "at least two or three decades", saying treaties or designated seats in the Federal Parliament — as in New Zealand's Parliament — were more likely.

"You need to look to the next 20 or 30 years for models that we need to gradually work towards," he said.

"If we are trying to get Aboriginal people, politically, as close as we can to the sovereign position that Aboriginal people had before the invasion in 1788, then the ultimate prize could be in a seventh state."

Aboriginals currently own, or have native title interests to 2.5 million square kilometres of land, or 33 per cent of Australia's land mass. ( Supplied: Jon Altman/Francis Markham )

SA, Victoria want their own treaties

The call came as the South Australian Government announced it wanted to reach treaties with Aboriginal groups in its state.

South Australia has set aside $4 million in its mid-year budget review for a "treaty commissioner".

State Aboriginal Affairs Minister Kyam Maher said he wanted discussions to start Wednesday and hoped the first treaty would be finalised within 12 months.

"We're not going in by any endpoints in mind. We're not going in with preconceived ideas about what might be included in a treaty," Mr Maher said.

"That is up for discussion and that's up for negotiation with Aboriginal South Australians."

Victoria began its own treaty process in May.

The Federal Government's Referendum Council, which is working towards constitutional recognition of Indigenous Australians, began nationwide talks with Aboriginal and Torres Strait Islander groups in Hobart last weekend.