The state will also apologise to the community following a landmark racial discrimination case in which the Federal Court found police were racist in their response to riots that followed Mr Doomagee's 2004 death in custody.

Jackie Trad, the Minister for Aboriginal and Torres Strait Islander Partnerships, on Tuesday announced the government had reached a $30 million settlement scheme with the 447 claimants, pending the court's approval.

"We do know that the events of the Palm Island riot so many years ago now have left a big scar on that community," she said.

"The money will allow many people who have felt aggrieved, who the Federal Court has found have substance to their grievances, to move on with their lives.

"We will now endeavour to work with the Palm Island community on a fitting way to recognise this historic apology."

The funds will cover damages, legal costs and the delivery of an apology.

Mr Doomagee, who has been referred to as Mulrunji for cultural reasons, died aged 36 in a Palm Island police cell on November 19, 2004 after being locked up for being drunk and a public nuisance.

Rioting broke out a week later when autopsy results were announced and police denied responsibility.

Indigenous activist Lex Wotton was jailed for inciting the riots that led to the local police station and home of arresting officer Chris Hurley - who would later be found responsible for Doomadgee's fatal injuries - being burnt to the ground.

Mr Wotton and two of his family members were later compensated $220,000 for the pain they endured during early morning raids.

Following Tuesday's announcement, he said residents had sought a $40 million settlement, but he was relieved the proceedings were over.

"How people react to it, that's up to them," Mr Wotton told AAP.

"The only process that can slow it down if someone wants to go off on his own, thinks he's worth more than what's being given."

Mr Doomadgee's cousin Alec said the community was still traumatised by his death and the events surrounding it.

"We will never move on. We will never forget and no amount of money will change that," Alec Doomadgee told AAP.

"We will never forget our Cameron.

"The community has suffered greatly. It's been a long road. It's a good day for the community and all the families who have been affected by the unfortunate death of my cousin.

"There's been a flow-on effect. We've also lost Cameron's son, his mother also has passed. No amount of money or time will bring back what we've lost."

Queensland Police Union president Ian Leavers criticised the settlement.

"We ... cannot understand how a court can award $30 million and order a government to apologise to Palm Island when a police station was burned down and riots were caused," he said.

"I reject the suggestion that police in these communities act in a racist manner and I know that police in these communities reject that suggestion too.

"I believe it is the police themselves who deserve the apology."

Australian Associated Press