Australia's crime fighting agencies would be greatly aided by the proposed data retention laws, Attorney-General Nicola Roxon said on Tuesday, adding that the government needs to be steps ahead of ordinary and tech-savvy criminals.

In her address before the Security Government held in Canberra today, Ms Roxon hinted that her office would welcome the reforms contained in the national security legislation that is the subject of an ongoing Parliamentary inquiry.

Its most controversial provision is the requirement that telcos must keep records of all their subscribers' transactions, voice and data, for two years, which can then be accessed by the Government, if and when the situation call for it.

Critics shot down the idea as too invasive, which in the end could compromise the privacy of Australians, at least those whose lives were with digital footprints.

But Ms Roxon said we now live in a different time and "when we talk about defending our nation and its secrets, we're now fairly and squarely working in an online environment."

"And this has created a whole new dimension of both opportunity and threat," the Attorney-General was quoted by Computerworld Australia as saying on Tuesday.

Today's crime fighting efforts and would definitely be boosted by capabilities that would allow law enforcement agencies to access instruments that technology presently offers, such as the ability to 'read back' what had transpired before, Ms Roxon said.

"The loss of this capability would be a major blow to our law enforcement agencies and to Australia's national security," the key Gillard cabinet member was reported by ABC as saying.

"The intention behind the proposed reform is to allow law enforcement agencies to continue investigating crime in light of new technologies," she further explained, adding that Australia can ill-afford to create a safe haven for criminals by not utilising the advantages afforded by modern technology.

Ms Roxon cited the murder case of MP John Newman in 1994, which was partly solved by police officers thanks to the information provided by his phone records.

The AG assured too that the government will endeavour to strike a balance between allowing police agencies to perform their work efficiently and to ensure that Aussies' privacy will be duly respected and protected.

But Greens Senator Scott Ludlam was far from being impressed, insisting that the proposed laws were anchored on dodgy premises.

At best, data retention as a national policy, would render all Australians as suspects and not citizens of a self-respecting society, Senator Ludlam said.

"This interception, copying, recording and disclosure of our data is a means to retroactively police the whole population," the Greens senator said in a statement on Tuesday.

He noted too that at its present form, Australia's surveillance capabilities were powerful enough citing the latest Telecommunications (Interception and Access) Act report, which showed that close to 250,000 data warrants were obtained by the Australian Federal Police (AFP) in 2011 as part of their crime-solving duties.

Yet for the AFP, the proposed security legislation would ensure that its present police muscle will be duly-protected by Australian laws.

Data retention, the AFP said, would hardly bestow new powers to law enforcement agencies.