Julia Gillard recognised a report, compiled by a panel of experts, which called for the repeal of two constitutional provisions with racist connotations.

The report also proposed that a new passage is added to the document to recognise that the territory was occupied long before its discovery by the British.

Julia Gillard said the “time is right to say yes to an understanding of our past”.

The amendments could be put to the Australian people in a referendum before the next general election in 2013, after prime minister Julia Gillard endorsed the unanimous findings of a panel of 19 experts.

Section 25 of the constitution recognises that states can disqualify people, such as Aborigines, from voting. Section 51 says federal parliament can make laws based upon a person’s race. Both were put in the constitution in 1901 to prevent certain races from living in areas reserved for white people or from taking up certain occupations.

The prime minister, Julia Gillard said: “We are big enough and it is the right time to say yes to an understanding of our past, to say yes to constitutional change, and to say yes to a future more united and more reconciled than we have ever been before.”

Nearly 5000 people were consulted, and more than 250 public meetings took place before the report was compiled.

Aboriginal elder Professor Patrick Dodson, urged bipartisan support for the proposals.

“This is a time when truth and respect for the Aboriginal and Torres Strait Islander peoples needs to be achieved through the recognition in our constitution,” he said. “Strong leadership and our national interest are critical for our nation to go forward.”

There were only two references to Aborigines in the constitution, compiled when Australia became a federation in 1901.

One denied federal parliament the power to make laws with respect to Aboriginal people in any state, while another excluded what it termed “Aboriginal natives” from the census.

They were both scrapped in 1967, leaving a constitution with no reference to Aborigines at all.

The current amendments represent an historical moment in Australian History, not least because referendums in Australia are hard to pass. Only eight out of 44 have succeeded since 1906, partly because any alteration to the constitution must be approved by a “double majority”. This demands that, as well as a majority yes vote being required nationally, a majority must also be reached in four of the six states.

The opposition leader, Tony Abbott, said: “We have some reservations about anything that might turn out to be a one-clause bill of rights but we accept that millions of Australians’ hopes and dreams are resting on constitutional recognition of indigenous people.”

The report also called for Aboriginal and Torres Strait Islander languages to be recognised as the country’s first languages. It calls for continuing respect for these cultures, languages and heritage.