A $1.5 billion work-for-the-dole program that overwhelmingly targets Indigenous communities has been labelled racist by Australian Council of Trade Unions secretary Sally McManus, with the prominent unionist arguing the government's policy denies Aboriginal people rights enjoyed by other Australians.

In a speech to the Garma Festival on Sunday, Ms McManus will ramp up a union campaign against the Community Development Program, which covers approximately 37,000 mostly Indigenous Australians. While the ACTU has long been hostile to the CDP, the speech marks the union leader's highest-profile and clearest attack on the program since she was elected in March.

"The bare-faced discrimination of the Community Development Program is a stark reminder that systemic racism endures," Ms McManus will tell an audience at the high-powered Indigenous event in the Northern Territory, also attended by Prime Minister Malcolm Turnbull, Opposition Leader Bill Shorten and prominent Aboriginal figures.

"Unlike every other 'work-for-the-dole' program or the $4 per hour internships the Turnbull government has introduced for young unemployed people, the CDP is compulsory. It is important to remind the rest of Australia of this – we have a system in our country where we make working for social support when unemployed compulsory for some Australians and not others."