Queensland Premier Peter Beattie says the Defence Minister's proposal to call out the military in the event of a terrorist threat has whipped up fear unnecessarily.
Senator Robert Hill's proposal has sparked more claims that the Government is using the prospect of a terrorist threat for political purposes.
Senator Hill wants to make it easier for the Government to call out the troops if there is a terrorist threat.
He wants more flexibility to be able to use the Reserves alongside the regular units, and to be able to send them into action against a rogue ship or aircraft.
He hopes Cabinet will agree and amendments to the existing legislation could be introduced before Christmas and passed next year, in time for the March Commonwealth Games in Melbourne.
Senator Hill's plan has seen front page headlines about soldiers with shoot-to-kill powers on city streets.
That concerns Mr Beattie, who says the Defence Minister should have been more careful when there is already unease in the community.
"It just alarms people unnecessarily," he said.
"People would expect that if there was a major terrorism incident in this country that the Army would have a role to play.
"I don't think anyone would argue about that. They should just get on and do it.
"My worry is that we've had an extensive debate about these tough laws - I think the consensus is: most sensible people are supporting them.
"But I just think sometimes the language used is unnecessary and I think that's the case here."
'Poor explanation'
The executive director of the Australia Defence Association (ADA), Neil James, says Senator Hill's plan could have been explained a lot better.
"Certainly in the current situation where there's been a lot of speculation and scaremongering about counter-terrorism in the papers, people could be frightened by that possibility," he said.
"But we really can't see it happening for the simple reason that you've got to remember that when the army are called out to assist police, they're only assisting police and they remain under police control.
"So it's not going to be a case where the military are going to be prowling the streets armed to the teeth, arresting people left, right and centre.
"That's just a farcical situation that you couldn't imagine happening, although you could imagine that at some stage elements of the military might be called in to assist the police to enforce the normal laws."
Need questioned
Greens Senator Kerry Nettle says the Government already has the powers Senator Hill is talking about.
"Extraordinary new powers were passed in 2000, which gave significantly more powers to the Army than they had ever received," she said.
"Troops were given the power to cordon off areas, to stop and search, to detain people and shoot-to-kill powers.
"That's pretty extensive powers and that's all of the areas that the Defence Minister has indicated he wants troops to be able to."
Senator Hill's spokeswoman says counter-terrorism exercises have shown there is a need to streamline the existing process.
She says it would mean troops could be used for a potential threat, when at the moment there has to be a specific threat.
But Senator Nettle says it is a smokescreen.
"We've seen now twice the terror card played by the Government as a way of seeking to garner support for their moves and making sure industrial relations isn't on the front page of the newspapers," Senator Nettle said.
