Conservative think tank the Institute of Public Affairs has warned the Abbott government it risks breaking an election promise if it abandons plans to repeal and re-write race hate laws.
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But ethnic groups and community leaders have welcomed signals from Attorney-General George Brandis that proposed changes to the Racial Discrimination Act, including section 18C - which makes it unlawful to offend, insult, humiliate or intimidate someone based on their race or ethnicity - will be watered down after public consultation.
Before the election, the Coalition promised to reform section 18C of the Act to strengthen free speech protections and in March, it revealed a plan to remove "offend, insult, humiliate" from the Act and make it unlawful to intimidate or racially vilify someone.
But a broad exemption for "words, sounds, images or writing spoken, broadcast, published or otherwise communicated in the course of participating in the public discussion of any political, social, cultural, religious, artistic, academic or scientific matter" provoked a storm of protest from the backbench and community leaders.
Senator Brandis, who personally drafted the draft laws, was rolled in the cabinet and forced to open up the proposed changes to community consultation, with 5557 submissions received in just over a month.
IPA executive director John Roskam said on Wednesday the government, led by Senator Brandis, had "not made the case for freedom of speech in Australia".
“The IPA's view is that this was an election promise and that the government should keep its commitments," he said,
"The draft bill should be presented to the Senate as is. While not perfect, it is a significant improvement on current legislation. If they water it down they would be better not to proceed at all."
But Council of Australian Jewry executive director Peter Wertheim said rather than watering down the changes the exposure draft should be "abandoned entirely".
"We don't think the case has been made to amend the existing legislation, that's not just our view, it's the view of the Law Council, the Human Rights Commission and many others," he said.
He said members of the indigenous, Greek, Jewish, Chinese, Arab and Korean communities lobbied 80 MPs from all parties in Canberra on Monday and Tuesday and "the opposition that was expressed to the government's proposals was even stronger than we had heard previously. Most of the Coalition MPs we met with expressed disapproval of the government's exposure draft".
Under pressure from Labor senator Lisa Singh during a Senate estimates hearing, Senator Brandis claimed Fairfax Media's report that he would water down exposure draft legislation was inaccurate.
But he did not detail what he thought was inaccurate, said "the government and I don't pretend to be the fount of all wisdom on this" and conceded his draft may have failed to get the balance right.
"This is an exercise in language and it may well be that there are better ways of expressing the basic concepts ... in the very words that have been used in the exposure draft," he said.
He also confirmed the government was looking to redraft the proposed laws.
"Those submissions that do more than just say get rid of 18C completely, or don't touch 18C, but that say 'we understand your objective but we think they would be better achieved by these words are going to be the most useful'.”
Senator Brandis said the government would reform - not abolish - section 18C.
Labor legal affairs spokesman Mark Dreyfus said Senator Brandis faced an "humiliating back down".
"Senator Brandis and Tony Abbott have simply has not made a case for altering Section 18C," he said.
