The idea that the adoption of Aboriginal children by non-indigenous families will create another stolen generation is a "furphy" says indigenous leader Warren Mundine.
The former Labor national president is backing calls by federal Children's Minister David Gillespie to allow the open adoption of children in care, even if it means placing indigenous kids outside their families or communities.
Australia needs to shake the fear of creating another Stolen Generation before it creates an abandoned generation, Dr Gillespie believes.
He wants to promote more open adoptions for all children in care, and Mr Mundine supports the idea, as long as it's not discriminatory.
"Quite frankly in regard to a stolen generation that's a furphy, it's not like that anymore," Mr Mundine told AAP on Tuesday.
"What we're seeing here is really incredible, disgraceful abuse that's happening in Aboriginal communities."
He says indigenous communities still carry the scars of the stolen generation and change is not going to be easy, but at the end of the day it's about child safety and ensuring the mistakes of the past aren't repeated.
Fostering and adoptions are a matter for each state and territory but Dr Gillespie wants to promote open adoptions and adoption policy development among his colleagues.
He said 25 per cent growth in children ending up in out of home care, and a large number of those being in permanent out of home care, was evidence of a crisis.
"...We are creating an abandoned generation who are left to permanent, unstable, rotating places of care," he told ABC on Tuesday.
Open adoptions would not be hidden or forced and parents and children would know where each other were, he said.
He also wouldn't want to see indigenous children targeted, but for it to be used to improve outcomes for all children in care.
Ongoing communication and contact between indigenous children and their families and communities will be key, Mr Mundine said.
In the right circumstances adopted children could visit their families and communities, but in a safe environment.
"Or if [their family's] in a good position eventually they can go backward and forward a lot more," he said.
Earlier, Dr Gillespie told News Corp it's "pretty poor" only 143 of the nearly 48,000 Australian children in foster care last year had been adopted.