All Indigenous Australians should have access to government-supported university places regardless of their postcode, Universities Australia says.

The organisation is using its latest Indigenous strategy report to call on the federal government to uncap university places for First Nations people living in urban areas.

Under current policy, only those in regional and remote locations are guaranteed a Commonwealth-supported university place.

That’s despite 75 per cent of Indigenous Australians living closer to the city.

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“Almost one in two young Australians in their 20s have a university degree but only seven per cent of young Indigenous Australians do,” chief executive Catriona Jackson said.

“Successive governments have tried to close the Indigenous education gap, yet they are still massively under-represented in our universities.”

The organisation’s Indigenous Strategy Report, released on Sunday, found close to all of Australia’s universities have specific recruitment activities or programs for potential Indigenous students.

More than half of institutions indicated a whole-of-university approach to Indigenous student support, while about 75 per cent had governance measures in place to ensure Indigenous views were represented.

Ms Jackson said the university sector was committed to breaking down barriers for Indigenous people but it was time for the federal government to act.

“Attending university is one of the greatest opportunities you can have in life, which is why we need to extend that opportunity widely,” she said.

“Uncapping places for Indigenous people living in metropolitan areas would go a long way to closing the attainment gap and addressing decades of disadvantage.”

Achieving university attainment parity between Indigenous and non-Indigenous people in major urban areas could also add $1.5 billion to the economy, Ms Jackson said.

-AAP