In a submission to the Yoorrook Justice Commission, Mr Andrews acknowledged racism and discrimination were behind Victoria's flawed systems and said systemic change would bring much-needed healing.
"In drafting the submissions, the Victorian government has reflected on the discrimination and mistreatment that First Peoples can often endure in the criminal justice and child protection systems," Mr Andrews said in the submission.
"The ongoing over-representation of First Peoples in the criminal justice and child protection systems is a source of great shame for the Victorian government.
"The government acknowledges the conditions and injustices that have cause this over-representation."
He condemned past atrocities linked to colonisation and the removal of children, some of which persist to this day and said treaty was the only way forward.
"Treaty is a process that offers the potential for transformation, whereby the Victorian government returns power to First Peoples so that First Peoples can build a positive future, on their own terms," Mr Andrews said.
Aboriginal and Torres Strait Islander children make up more than 20 per cent of kids in child protection, up from 14.6 per cent in 2016.
The First Peoples' Assembly of Victoria, which alongside the state government helped establish Yoorrook in 2021, welcomed Mr Andrews' acknowledgement.
"First Peoples right across this state live the experience of racism and injustice that the premier has described, day in, day out," Assembly co-chair and Bangerang and Wiradjuri Elder Aunty Geraldine Atkinson said.
"While of course this is not news to us and has been true since colonisation, I do welcome the premier's words.
"I hope this acknowledgement at last is cause for discussion and reflection amongst the broader Victorian population on the reality we face and how we need Treaty to finally address the harms of colonisation."
It follows criticism the state's child protection system is failing First Nations children by not helping them maintain their cultural identity on a consistent basis.
About 66 per cent of Aboriginal and Torres Strait Islander children in government care have a cultural support plan, which falls short of the state's mandatory requirement of 100 per cent, a truth-telling inquiry heard on Friday.
The Department of Families, Fairness and Housing said the gap potentially meant there was a proportion of children who lacked connection to culture and community and may not know who they are.
"I think we still have a way to go," the department's acting associate secretary Argiri Alisandratos told the hearing.
The state required cultural support plans be put in place within 19 weeks of a child going into government care, which Mr Alisandratos admitted does not always occur.
Commissioner Kevin Bell described Victoria's child protection system as shameful and called for a complete overhaul.
"The systems operate shamefully with respect to Aboriginal children taken into care and if the system operates shamefully then surely the system is shameful... it's one in which there needs to be root and branch structural reform," Commissioner Bell said.
Yoorrook is the first formal truth telling inquiry into past and ongoing injustice against First Peoples in Victoria.
Community members, experts and leaders will continue to give evidence on the impact of injustice within the criminal justice and child protection systems on First Peoples.
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