With Noel Pearson,Ms Mason is one of the architects of a strategy to empower communities that was put to the Abbott government almost two years ago and given only qualified backing.
Mr Turnbull recently met with the eight leaders behind the strategy and is expected to convene a meeting with like-minded leaders in coming months to develop empowerment models across the country.
"The refreshed council reflects the Government's deep commitment to doing things with Indigenous Australians in a genuine partnership,"Mr Turnbull said in a joint statement with Indigenous Affairs Minister Senator Nigel Scullion.
The move follows damning reports on the failure to properly evaluate programs,the flawed implementation of the Abbott government's Indigenous Advancement Strategy and stringing criticisms from Indigenous leaders.
A Productivity Commission report on Indigenous disadvantage in November revealed progress in health and education outcomes,but the situation getting worse when it comes to violence,mental health and imprisonment.
Mr Turnbull is intent on winning trust by opting for a more transparent process for appointing members and declaring the government's"deep commitment to doing things with Indigenous Australians in a genuine partnership".
"The Council is expected to work with,and draw in,other Indigenous Australians to ensure the Government has advice from a range of stakeholders and communities,"Mr Turnbull and Senator Scullion said.
Other members of the council are Susan Murphy,CEO of Winun Ngari Aboriginal Corporation;Ngiare Brown,Professor of Indigenous Health at the University of Wollongong;Roy Ah See,chair of the New South Wales Aboriginal Land Council;and Djambawa Marawilli,traditional owner from Baniyala.
Sources say the government may decide to keep to a six-member council and co-opt others for specific assignments or expand the membership. Either Dr Sarra and Ms Mason is expected to lead the council.
Mr Abbott's Indigenous Advisory Council was appointed in September 2013 with Warren Mundine as its chair,but it has been an amorphous body without clout or a clear purpose.
Dr Sarra,chairman of the Caboolture-based Stronger,Smarter Institute,was approached by Mr Turnbull soon after the latter toppled Mr Abbott,and asked for three things Mr Turnbull could do in Indigenous affairs that would make a difference.
It was too important and complex a question to answer on the spot,Dr Sarra replied,but he promised to come back with a response that Mr Turnbull repeated in Parliament when he tabled the 2016 report on Closing the Gap this time last year.
"Firstly,acknowledge,embrace and celebrate the humanity of Indigenous Australians. Secondly,bring us policy approaches that nurture hope and optimism rather than entrench despair. And lastly,do things with us,not to us,"he quoted Dr Sarra as saying.
In the same speech,Mr Turnbull promised to take the first step towards implementing the empowered communities model and apply the Dr Sarra formula to the challenge of achieving constitutional recognition.
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