Aboriginal Affairs Minister Gabrielle Williams on Friday announced the $300,000 interim program, which will operate until a $10 million reparations scheme begins later in 2020.

The program, which will be backdated for any death after January 1, will provide family members with up to $10,000 to cover the costs of a funeral, headstone or plaque and/or the repatriation of their loved one.

"This support will make a significant difference to the lives of many stolen generations families," Ms Williams said in a statement.

"It is also an acknowledgement of the past injustices perpetrated by the state against stolen generations and their families.

"We cannot change the past, but we can confront it and help make a difference to the lives of so many Aboriginal Victorian people who have suffered and continue to suffer."

Victoria will be the final state to introduce a redress scheme for the stolen generations later this year.

It is estimated almost 10 per cent of Victoria's Aboriginal and Torres Strait Islander population aged 50 and over are members of the stolen generation, taken from their parents between 1910 and 1970 as part of a government-run assimilation regime.

The state had the third-highest rate of removal in the country, with more than one-third of Victoria's Aboriginal and Torres Strait Islander population descendants of the stolen generations.

Ian Hamm, the chair of the Stolen Generations Reparations Steering Committee, said the funeral costs program would give stolen generations "a dignity in death they may not have always had in life".

"It allows (families) to grieve without the additional burden of the expense of a funeral," he said.

"It is the right thing to do; it is the decent thing to do."

In March, the state government announced an Australian-first inquiry into the historic and ongoing injustices committed against Indigenous people, in partnership with the First Peoples' Assembly of Victoria.

The inquiry, which will be independent of government and have the powers of a royal commission, will examine historical and ongoing injustices committed against Aboriginal Victorians across all areas of social, political and economic life.

The interim funeral fund will be administered by Connecting Home Limited. For further information, contact CHL at sgr@connectinghome.org.au or 1800 747 732.

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Australian Associated Press