Cabinet minister Josh Frydenberg has accused the Grand Mufti of Australia, Dr Ibrahim Abu Mohammed, of a failure of leadership and an inadequate response to the recent international terrorist attacks.
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Mr Frydenberg, the Resources Minister, said on Sunday the Grand Mufti had tried to "cover up" his initial remarks about the Paris terrorist attacks, which some commentators felt were not tough enough.
"His first reaction was his instinctive reaction," Mr Frydenberg told Sky News.
"The Grand Mufti has failed in his leadership with his statements. He has more of a responsibility, not only to the Muslim community but to the community at large."
Dr Mohammed, the spiritual leader of Sunni Muslims in Australia, issued a statement following the Paris attacks in which he condemned the actions of those responsible.
But he was criticised for the statement, issued on behalf of the Australian National Imams Council, which also suggested racism and Islamophobia were partly to blame.
The later statement said: "We wish to emphasise it is incorrect to imply that the reference to causative factors provides justification for these acts of terrorism. There is no justification for the taking of innocent lives."
Prime Minister Malcolm Turnbull and other ministers accepted the amended statement.
"I've seen the controversy reported in the press. I've noted also that he [the Grand Mufti] has clarified that initial statement; that seems to have cleared up the issue," Mr Turnbull said.
"I'm pleased to see his condemnation of Daesh, of that terrorist attack, has been made very clear in his subsequent remarks."
But Mr Frydenberg has broken ranks with his leader, accusing Dr Mohammed of trying to "cover up" the first statement and not doing enough to counter extremist Islam.
When asked if Dr Mohammed should resign, Mr Frydenberg said it was "a matter for the Mufti and the Muslim community".
"I think that he needs to show greater leadership than he did."
Fairfax Media has asked Dr Mohammed for a response.
Mr Frydenberg also suggested more military action was needed in Syria and Iraq and pointed to comments made by US presidential candidate Hillary Clinton.
"It's very clear that what's happening in Syria and Iraq is spreading terrorism across the globe, and we're seeing it in Australia. We can't afford to have another failed state like Afghanistan."