Coalition MP Dennis Jensen has told Parliament he does not think the Government should be funding people to live a "noble savage" lifestyle in remote Indigenous communities.

When he was prime minister Tony Abbott argued the Federal Government could not "endlessly subsidise lifestyle choices".

Mr Abbott was speaking in relation to a Western Australian Government plan to shut down a number of remote Indigenous communities.

Mr Jensen, a West Australian MP, said he endorsed that position and did not think there should be specific policies singling out Indigenous Australians.

"In essence, if the 'noble savage' lifestyle, à la Jean-Jacques Rousseau, the same one often eulogised, is true, then there is nothing stopping any Indigenous men or women from pursuing such an existence on their own," Mr Jensen said.

"Just do not expect the taxpayers to subsidise it."

Opposition Leader Bill Shorten responded to the comment by saying Mr Jensen was "away with the pixies".

"His own party don't even want him to be a member of Parliament," Mr Shorten said.

"Malcolm Turnbull's got a leadership challenge here. I don't mean in terms of his own position but in terms of: is he the leader of the Liberal Party, or is he just the frontman who 's been borrowed by the right wing of the Liberal Party to make the Liberal Party look better to the Australian people?"

Mr Jensen fired back immediately on social media, describing the Opposition Leader as "gutless" and challenging him to a debate "anytime".

Jensen calls for an end to Indigenous-only policies

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The full speech was delivered in parliament on Monday night, during Mr Jensen's contribution to the debate on Appropriation Bills.

The South African born MP said he fought against the racist policies of apartheid, and "racism, whether positive or negative in intent, is still racism".

"I will be blunt. In my view, there should be no specific Indigenous policy. There should be no race descriptors," he said.

"There should be no definition of what it is to be Aboriginal, any more than, say, an Irish-Australian should have a definition and a percentage of Irish blood that he or she should have in order to be described as Irish-Australian.

"Self-identification is the key to this puzzle.

"Indeed, the only reason that this is done is due to the racist laws that we have here in Australia.

"The road to hell is paved with good intentions."