Queensland Premier Campbell Newman says federal MP Clive Palmer should withdraw his defamation action to spare taxpayers from paying the legal bills.

However Mr Palmer, who last week served papers on Mr Newman claiming Mr Newman had falsely accused him of trying to "buy" the state's LNP Government, says the Premier should apologise.

The Member for Fairfax is seeking $1.1 million in damages, with Mr Newman's defence to be funded by taxpayers.

On Fairfax radio this morning, Mr Newman said it was time Mr Palmer was put under the spotlight.

"I'm a man of modest means, believe it or not - I'm doing this job for Queenslanders," he said.

"He is a multi-multi-millionaire who likes to throw around these resources to try and shut people up.

"I won't be silenced by Mr Palmer and that's why I'm being essentially defended by the system, as other premiers have in the past.

"Mr Palmer - it is hot in the kitchen and if you're going to dish it out, you've got to be able to take it as well.

"I would suggest the easy way for him to save taxpayers' money is for him to withdraw from legal action."

Mr Palmer says he will not consider withdrawing the action until Mr Newman apologises.

"The critical question is whether he'll apologise and say to the people of Queensland categorically what he said was untrue, and he had no basis to say it and he regrets it," Mr Palmer said.

"That's the first step in me considering withdrawing my action."

Mr Newman responded by saying he stood by his comments.

Mr Palmer says the Premier is panicking.

"He doesn't know what to do," Mr Palmer said.

"He's a poor little angry ant running around waiting to be extinguished at the next election."

Palmer 'all power and money': Bleijie

Meanwhile, Attorney-General Jarrod Bleijie has defended the use by Deputy Premier Jeff Seeney of parliamentary privilege to call Mr Palmer a "crook".

One of the State Government's own backbenchers, Jason Woodforth, has today called for higher standards in the House following the comments last week.

But Mr Bleijie says Parliament is a place for vigorous debate.

"Jason Woodforth is a member of parliament - he's doing a great job in his local electorate," he said.

"Parliament is a place for ideas to be debated.

"But on Mr Palmer - let me make it abundantly clear - there is one thing that Mr Palmer is interested in, and that's Clive Palmer - it's all power and money."