Should Australia have tighter privacy laws to avoid a similar phone hacking scandal involving the media? Treading on press freedom and creating policies to protect individual privacy are delicate issues that government authorities and law makers are assessing amidst the phone hacking issue in the United Kingdom involving News Corp owned by Rupert Murdoch, serving as a test case for media organizations in the country.

Mr Abbott has warned the Labor Party-led Parliament of Prime Minister Julia Gillard to take it easy on the issue of press freedom and privacy issues citing an ire cast on Australia subsidiary News Corp Ltd.

Mr Abbott told reporters that Ms Gillard should be very specific as she tries to implicate Rupert Murdoch's News Corp.'s Australian affiliate led by John Hartigan in the British phone hacking scandal.

The Prime Minister on Thursday said News Ltd had "hard questions to answer" in light of the News of the World scandal.

Speaking in Melbourne, Mr Abbott urged the Prime Minister to "put up or shut up".

"The Prime Minister must specify exactly what those questions are and if she can't specify exactly what those questions are then she's just smearing a perfectly good organisation," Mr Abbott said.

"Frankly it demeans our polity for this kind of thing to go on."

Reports from the Australian quoting News Ltd chairman and chief executive Mr Hartigan indicated it was "unjustified and regrettable" that Ms Gillard had linked the British newspaper crisis to the Australian division of News Corp.

Ms Gillard on Friday said she had done no more but it must be pointed out that the Australian affiliate of News Corp had suddenly conducted an audit of its own since the phone hacking scandal started.

The Prime Minister cited the News Ltd audit of editorial expenditure over the last three years, announced last week by Mr Hartigan, to suggest the company was asking questions of itself.

"He has ordered a review to obviously pursue issues and questions that he thinks should be answered," Ms Gillard said.

"It's not surprising that Australians are asking themselves the question too, what does this mean for Australia?"

However Privacy Minister Brendan O'Connor said that though there is now a need to re-examine the privacy laws in the country, this does not mean to single out News Ltd.

Mr O'Connor said in Sky News this morning that he did not have any questions to ask of News Ltd over Britain's phone hacking scandal and believed the company was responding appropriately to the crisis.

"Mr Hartigan is already now putting in place a rigorous approach to examine how they operate," he told Sky News.