Ric Simes says his firm Access Economics has found all Australians would benefit from measures to improve life expectancy and employment rates for Indigenous people.
He says the savings would come from a more effective workforce and less expenditure on public health.
"The total burden of disease as they call it would be 59 per cent lower, most of that would come through improvements in cardiovascular disease, mental disorders and improvements in diabetes," he said.
Mr Simes says removing disparities such as lower life expectancy rates for Indigenous people would add 1 per cent to Australia’s gross domestic product over the next two decades.
"If those gaps in life expectancy, in labour force participation rate and labour productivity were closed over a 20-year period then progressively we have higher population, higher labour force, higher economic growth overall and the net results are quite substantial," he said.
According to the report this 1 per cent increase in GDP is bigger than the forecast increase in Australia’s population over the same period, meaning that living standards of all Australians would rise as a result.