Jon Stanhope, the Australian Capital Territory Chief Minister, is the first Australian state or territory chief to reject the Howard Government's proposed anti-terror legislation in its current state.
He said he would not vote into law the ACT's part of the legislation, including extending preventive detention of terror suspects to 14 days, unless there were changes.
The Federal Government requires the support of a least four states to give the final legislation the go-ahead. If the Commonwealth proceeds with its laws without the ACT's co-operation - the territory could become the odd jurisdiction out, as the only one without preventive detention for people suspected of planning a terrorist attack.
"I'm quite happy to change it provided the situation is covered," Mr Howard told reporters in Madang, at the Pacific Islands Forum. "I'm quite relaxed about the final form of the legislation, providing it delivers on the substance of the agreement." Mr Howard said he was not committed to introducing the changes next week, although he wanted them by Christmas.
Opposition Leader Kim Beazley, who was outraged that the Government had chosen Melbourne Cup Day as a cover to introduce the Bills, pointed out that the Treasurer and the Prime Minister were at odds.
The Australian PM has agreed to changes to Australia's controversial Anti-Terror Laws, after comments from his own Treasurer.
Peter Costello, speaking to The Age Newspaper for the first time on the issue, apparently contradicted earlier statements made by the PM, saying, "Unfortunately nobody ever finally knows these things until such time as the court rules".
"Peter Costello contradicted John Howard today and went out there and said 'Well it might be unconstitutional but let's just sort of suck it and see'," Mr Beazley said to Melbourne’s Herald Sun newspaper.
Mr Howard said there was nothing of concern in legal advice from the Solicitor-General and he remained convinced the laws were constitutional, but did concede to changes to the so-called “shoot-to-kill” provisions for police.
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Queensland Premier Peter Beattie welcomed Mr Howard's move on the shoot-to-kill clause and said he was confident all constitutional issues could be overcome.
The Human Rights and Equal Opportunities Commission(HREOC) president is of the belief that the bill needs to be reconsidered because it is not in line with Australia's international human rights obligations.
HREOC is a national independent statutory body of the Australian Government. It has the responsibility for investigating alleged infringements under Australia’s anti-discrimination legislation.
The Head of HREOC says under the proposed laws the opportunity to challenge a detention order against an individual or a control order against the person's family is unrealistic, and has concerns about what happens to a person after they are subjected to a preventive detention order.
"They're not told why they're subject to it, nor is there any way in which they can go about challenging the facts upon which that order is made," he told the ABC.
"That's the real, the most serious of the human rights issues in the whole procedure. There is no means of reviewing what has been done once its happened."
"International human rights law requires that a person who is detained must have the right to challenge this detention in a court without delay. Review before the court needs to include: consideration of whether the order is based on a correct understanding of the facts; whether the detention is fair; whether it is reasonably necessary in the circumstances; and whether it is proportionate to the goal of protecting national security. The current form of the bill simply fails to meet these basic guarantees."
HREOC says a special court should be established to review enforcement provisions in the draft bill.

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Australian anti-terror laws will be delayed