Aboriginal people who were near British nuclear tests in the 1950s and 1960s will finally receive improved health care, the Federal Government has revealed.

Britain tested atomic weapons at Maralinga and Emu Fields in South Australia and around Western Australia's Monte Bello Islands.

Many Indigenous people were moved away before the tests in South Australia's far north.

But some remained and were subjected to extreme levels of radiation, which a royal commission linked to significant injuries and disabilities.

Veterans' Affairs Minister Dan Tehan last night said those people would now receive improved health care from the Commonwealth.

"Subject to the passage of legislation, the measure will provide Gold Cards to Indigenous people present at or near Maralinga, Emu Fields or the Monte Bello Islands at the time of the British nuclear tests in the 1950s or 1960s," Mr Tehan said.

Emu Field in South Australia was the site of Operation Totem where a pair of nuclear tests were conducted by the British Government in 1953. ( Supplied: Burrinja Cultural Centre/Rosemary Laing )

The veterans' Gold Card covers most health costs.

The breakthrough follows decades of campaigning by those affected, their relatives and advocates.

Government budgets for veterans' health

The funding is part of a $133-million federal budget package for military personnel who survived the British tests and veterans who served in Japan after World War II.

Today's budget will also boost veterans' mental health care by more than $50 million, including through psychological services and suicide prevention trials.

More than $150 million will also go towards improving the Department of Veterans' Affairs ageing computer systems.

South Australia's Aboriginal Legal Rights Movement (ALRM) welcomed the announcement.

But ALRM chief executive Cheryl Axleby said people were still seeking compensation for both immediate and intergenerational health issues caused by the radiation.

"The ALRM has been contacted by members of the community, particularly from the Maralinga community, trying to seek … compensation for themselves in regards to the harm caused," she said.

"It's great to have the recognition, but it's really about compensation as well."

Ms Axleby questioned why the changes to Gold Card eligibility had taken so long.

"We're now 60 years after the event has occurred," she said.

"The outlay may not be as costly as it would have been say, 20 or 30 years ago, for the government - and those sorts of questions do stick out in my mind."