In recent weeks, Mr Dutton escalated pressure on Labor over the legislation, accusing the opposition of hampering the bill's progress. Last week, he wrote to the committee urging it to "accelerate" its work to ensure the bill was passed before the Christmas break. Mr Morrison said he would "insist" the bill be passed by the deadline. Mr Dreyfus accused the government of "subversion of the democratic parliamentary committee process" and said Labor had accepted security agencies' strong support for the legislation, backing an interim version of the bill to meet the agencies' urgent needs while scrutiny of the broader package continued. "Labor considers it is a workable compromise considering the extraordinary pressure put on the committee to cut its scrutiny of the bill short. Your government’s refusal to even work with this offer — despite written assurances of support — is extremely disappointing," he wrote. Mr Dreyfus said "the politicisation of national security has driven Labor to this point". "Issuing a dissenting report is an outcome Labor has tried to avoid with the utmost goodwill and endeavour – and our offer of an interim bill that gives agencies the powers they said were necessary remains available," he said.

In a statement, Mr Porter and Mr Dutton said the shadow attorney-general "rejected the national interest in pandering to the left wing of his party" by undermining progress on the legislation. "As the prime minister has already indicated, the government wants this bill passed before Christmas, a time of heightened terrorist focus according to [ASIO director-general Duncan Lewis]," they said. "So the government will present the bill for consideration by the Parliament next week. In doing so, we will also present all reasonable amendments that have been proposed, including several by Labor, while rejecting those unreasonable propositions that would render the bill ineffective." Since 2014, the committee has co-operated on 15 national security bills and agreed on 300 amendments to legislation that have subsequently been adopted by the government. According to Labor, the failure to reach consensus on this legislation is the first time in over a decade that the committee has not reached a bipartisan agreement. The Coalition has a majority on the committee so it can still recommend Parliament pass the legislation. However, it is unclear whether the bill would get through Parliament without Labor's support. The blow-up gives the government an opportunity to focus on national security — a traditional political strength for the Coalition — during the last parliamentary sitting week of the year.

In his letter, Mr Dreyfus noted there were widespread and unresolved concerns from industry and experts about the complex legislation, including fears it could ultimately weaken national security, harm companies and undermine innocent people's online security. He also pointed to a surprise intervention from Senate president Scott Ryan on Thursday, who warned the new powers could interfere with parliamentary privilege, an important legal protection for MPs' work. "It is vital that the bipartisanship of this committee be restored. It is due to actions primarily by those outside the committee — namely, the Minister for Home Affairs and the Prime Minister — that Labor has been driven to this point. It is still within the government’s power to fix this situation," Mr Dreyfus said. Opposition Leader Bill Shorten indicated Labor's hostility to the current form of the legislation and desire to keep working on it. "No point in passing a law which doesn't work. No point in passing a law which leaves the back door open for Russian hackers to come in. No point leaving a law open or passed which then creates difficulties with our allies," Mr Shorten said.