The federal government has promised more than $250 million in new funding as it continues its battle to close the life expectancy gap between indigenous and non-indigenous Australians.

Treasurer Wayne Swan promised $90 million over five years for indigenous child and maternal health services, $99 million over five years for more teachers in the Northern Territory and $56 million over four years to widen literacy and numeracy programs for indigenous students.

Swan branded the fight to narrow the current 17-year difference in life expectancy a "long-term challenge for our nation".

Delivering on election promises
Indigenous Affairs Minister Jenny Macklin said the government has promised more than $1.2 billion over five years to indigenous funding programs since coming into power last year.

"This budget delivers the government's election commitments and implements policies that will improve the lives of Aboriginal and Torres Strait Islander people," Ms Macklin said in a statement.

Funding for the ongoing Northern Territory intervention will be $323.8 million in 2008-09, including $69.2 million to keep implementing welfare payment control programmes. These are aimed at ensuring that welfare payments are spent on necessities, rather than drugs and alcohol.

"The implementation of income management has revealed that some indigenous families would benefit from training in money management," Ms Macklin said.

That training will be worth $3.1 million with the new services delivering education in how to write a family budget and how to cope with a financial crisis.

AMA ‘relieved’ for indigenous health

Australian Medical Association president Dr Rosanna Capolingua said the new budget answers the health needs of indigenous groups better than its predecessor.

"We were concerned that health would be severely affected. (But) there are issues in the budget that actually deliver many of the things the AMA has actually been calling for, such as indigenous health, focusing on public hospitals and public health issues.

"So from that aspect we are pleased to see health has been relatively spared."

Welfare debit card debuts

The federal government has taken steps to quarantine welfare payments and prevent their misuse with the introduction of an income management debit card.

The $17 million scheme will be rolled out across the country from July 1 beginning with selected indigenous communities.

The card will be pin-protected and can be used to purchase essential goods and services. It cannot be used to purchase alcohol, tobacco, pornography, gambling or to withdraw cash.

Centrelink will issue the card and provide support to people who need assistance in learning how to use it, and will work with local businesses during the roll-out and accreditation of the new system.

Community Services Minister Jenny Macklin said the introduction of the card was a practical measure aimed at ensuring welfare payments were spent in the interests of children.

"The debit card will make it easier for people on income management to buy essential items," Ms Macklin said.

The plan has been attacked in some circles, however, with the nation's peak welfare group saying it would not address the real issues surrounding child abuse and neglect.

Australian Council of Social Services president Lin Hatfield Dodds said in the lead-up to the budget that the money would be better spent on services for families in need.