Opposition Leader Tony Abbott is standing by his immigration spokesman Scott Morrison amid calls for his sacking over his alleged proposal for the Coalition to pursue an anti-Muslim agenda.

A Fairfax report says Mr Morrison urged shadow cabinet to capitalise on electorate fears of "Muslim immigration", "Muslims in Australia" and Muslim migrants' "inability to integrate".

The report says Mr Morrison's suggestion was slapped down by senior Liberals including Julie Bishop and Philip Ruddock, but the Opposition has been under pressure over reports of a continuing split within the party over the issue.

Mr Morrison says he does not comment on shadow cabinet discussions, but Ms Gillard is demanding an explanation.

"This is a big question for Mr Abbott to answer today in an act of leadership, is he saying the modern Liberal Party now stands for discrimination on the basis of religion?" she said.

"Mr Morrison, from today's reports, appears to want to go down a very grubby path in the migration debate in this country.

"Is Mr Abbott going to follow him down that path, or stop it now and get Mr Morrison to go to the back bench?"

Labor Senator Doug Cameron echoed Ms Gillard's calls.

"This is not just some lack of judgement, this goes much further than that," he said.

"I call on Tony Abbott to show some leadership - sack Scott Morrison and have a shadow minister there who can understand the real issues facing Australia."

Speaking this morning, Mr Abbott called the Sydney Morning Herald report a "travesty" of Mr Morrison's position during the shadow cabinet discussion.

He said there was no-one in public life who was more decent, compassionate and sensitive than Mr Morrison.

"From time to time there are always going to be issues but I think there is no more successful immigrant society in the world than Australia," he said.

"The important thing for political parties is to do the right thing by our country and the right thing for Australia is for us to continue to be an absolute model of a successful immigrant society."

Mr Morrison has dismissed the reports as "gossip".

"As all journalists know I don't comment on shadow cabinet here or anywhere else. All I can say is the gossip reported today does not reflect my views," he said.

'Colour blind'

Yesterday Mr Morrison was forced to apologise for the timing of his comments on the Sydney funerals of asylum seekers killed in the Christmas Island shipwreck.

Opposition frontbencher Greg Hunt this morning defended Mr Morrison and played down reports of division in the party.

"Our position is very clear. That we are completely colour blind, race blind, religion blind on the issue of immigration," he said.

"Where we do have a difference with the Government is where people are being lured with policies to travel in dangerous leaky boats, then we think that is a great risk to common humanity."

While refusing to deny Mr Morrison made the comments, Mr Hunt said the immigration spokesman was a compassionate man.

"Unfortunately I wasn't at the meeting, but I know Scott, and his style is deep compassion, he is deeply compassionate, he agonises around the issues of protecting people who are being lured to their deaths," he said.

One Nation policy

Mr Hunt also dismissed claims the Coalition is looking to One Nation for policies.

In an interview with The Australian, Queensland One Nation director Ian Nelson says the Opposition stole the party's idea of cutting aid to Indonesian schools to help pay for Queensland's flood recovery.

"They can deny all they like, but the idea came from us," he said.

Mr Nelson says he made the call to channel foreign aid into the flood recovery on One Nation's website in the aftermath of the floods in and around Brisbane.

"After watching this tragedy unfold, we need to see a new model produced with regards to aid, especially foreign aid. Wouldn't common sense dictate that you take care of your own citizens first and foremost?" he wrote on the site.

Within weeks, Mr Abbott had adopted the policy, calling for $500 million in funding for schools in Indonesia to be cut.

But Mr Hunt says the policy has been proposed throughout the community.

"I think you'll find that lots of people have very strong views, I think you heard in the last few days, the chairman of the Business Council of Australia raised precisely the same point," he said.

Earlier this week Mr Abbott backed ACT Senator Gary Humphries's right to present a three-signature petition demanding a 10-year moratorium on Muslim immigration to the ACT parliament, but said he did not agree with its proposal.