Labour MP David Lammy, who led the review, said young offenders from ethnic minorities will become “the next generation” of criminals unless the justice system is reformed.
The system in England and Wales is biased against those from ethnic minority backgrounds and discriminates against them, according to the review.
Mr Lammy included delaying or dropping some prosecutions amongst his 35 recommendations.
The government responded saying it would “look carefully” at the suggestions.
According to the review, 25% of the prison population in England and Wales is made up of people from black, Asian and minority ethnic (BAME) backgrounds. In the youth justice system, that percentage becomes 41%. Just 14% of the country’s population is made up of these groups.
An increase in the proportion of first-time offenders from these backgrounds to 19% – up from 11% – in the past 10 years, was a statistic highlighted as “concerning” by the report, and the same increase in the proportion of young people reoffending.
Some of the recommendations included allowing low-level offenders to “defer” prosecution and opt for a rehabilitation programme before entering a plea, introduction of targets for a workforce more representative of the population within the justice system, and an increase in the gathering of data and information on the ethnicity and religion of offenders.
Mr Lammy said his report was about looking at the “treatment and outcomes” of those from minority backgrounds and that it was well established that there was an over-representation of people from those groups in the criminal justice system.
“Having looked at the evidence over the past 18 months, my judgment is that we have a significant problem in the criminal justice system itself, and that the treatment of BAME young people shows this problem is getting worse,” he said in his review.
He added, “young black people are now nine times more likely to be in youth custody than young white people. I expected to find the youth justice system laser-focused on this issue. Instead, I have seen large parts of the system indifferent to issues of race.”
“When children leave custody, they need family support more than anything else. But the youth justice system appears to have given up on parenting. Last year, 55,000 young offenders were found guilty in the courts.”
Mr Lammy pointed out that BAME children are less likely to be recorded as having various concerns such as mental health issues or substance misuse issues, unlike their white peers.
“The disproportionate number of BAME young people in the justice system is a social timebomb. It is beyond time to stop talking about this problem and to act,” he said.