At the halfway mark of the 2031 Closing the Gap agreement, First Nations pre-school enrolments are the sole target being met nationally while four key areas are getting worse.
Of the 19 identified socio-economic areas targeted to close the disparity between Indigenous and non-Indigenous Australians, only three are on track to be met, the Productivity Commission's 2026 report said.
Adult imprisonment, childhood development, out-of-home care and suicide were the areas going backwards.
''The deadline for meeting most of the targets is 2031 so we are already past the halfway point,'' Productivity Commissioner Selwyn Button said.
''Governments will need to redouble their efforts for the promise of the National Agreement on Closing the Gap to become a reality.''
Pre-school is the only clear win so far, with data showing more than 95 per cent of First Nations children enrolled.
It surpasses the target, marking an increase from 2016's 61.3 per cent enrolments.
"This is a significant milestone and shows that collective efforts can drive meaningful and lasting change," Indigenous Australians Minister Malarndirri McCarthy said.
''This result is encouraging.
''However, it is very concerning that we are still seeing outcomes worsening for early childhood development, children in out-of-home care, incarceration rates and suicide."
Targets on track to be met by 2031 include employment.
Aboriginal and Torres Strait Islander people aged 25-64 in work is on track to reach the 62 per cent target by 2031.
Land and sea rights are also expanding fast enough to hit the goal of a 15 per cent increase by 2030, with more than 4.4 million square kilometres of land and about 113,500 square kilometres of sea now covered by First Nations legal rights or interests.
Five targets that are improving but not on track include education and housing with more young people finishing Year 12, more adults holding tertiary qualifications and more youth in work, education or training.
However, only 81.4 per cent were in appropriately sized housing in 2021 against an 88 per cent goal.
Justice remains one of the biggest failures.
The rate of First Nations prisoners jumped to more than 2500 per 100,000 adults in 2025 and up from more than 2300 a year earlier and more than 550 in 2019
A key Closing the Gap aim is to reduce the rate of First Nations adults held in incarceration by at least 15 per cent in the next five years.
Imprisonment rates have risen across most jurisdictions since 2019, with the Northern Territory suffering the worst blowout - an increase of 1609 prisoners per 100,000 adults in six years - while Victoria is the only state with a clear fall.
First Nations youths remain heavily over-represented in detention, with 25.7 children aged 10-17 per 10,000 in custody on an average day in 2024-25 and ''no change from the baseline'' towards the target of a 30 per cent cut by 2031.
Child protection and early development are also heading the wrong way, with 52.2 per 1000 Aboriginal and Torres Strait Islander kids in out-of-home care in 2025 and only 33.9 per cent starting school developmentally on track in 2024.
Suicide is at crisis levels, with 33.9 First Nations people per 100,000 taking their own lives in 2024 and self-harm now the leading cause of death for those aged 15-39.
Life expectancy has inched up but is still off track, at 71.9 years for Aboriginal and Torres Strait Islander males and 75.6 years for females born in 2020-22.
Mr Button warned that without faster, targeted action the gap will not close and, in some areas, will continue to widen.
Key to progress remains action on the four Priority Reforms – sharing decision-making, building the community-controlled sector, transforming government organisations and sharing access to local data, the report said.
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