Dismantling Section 18C is an election promise of the Coalition, which hardened its opposition after News Corp Australia columnist Andrew Bolt was found guilty of racial vilification under this section of the act.

Section 18C prohibits remarks that offend others on grounds of race or ethnicity.

A government source told The Australian last night that Attorney-General George Brandis was now working on a “compromise” solution that would remove the “hurt feelings” test while preserving the statutory right to protection against racial discrimination.

The source said the compromise would satisfy the growing number of critics of the move and Senator Brandis would not deliver a blanket repeal of 18C.

Mr Mundine said he had consulted council members, who were equally concerned by the proposed change. “I have made my thoughts clear to the Prime Minister and the government,” he told The Australian yesterday.

“We are not happy about 18C being taken out.”

Mr Mundine’s newly appointed deputy on the council, Aboriginal doctor Ngiare Brown, strongly backed him last night.

“I think it is an essential social and legal protection, not just for Aboriginal people but for other racial groups,” Dr Brown told The Australian.

“I’m tired of people hiding behind the right to free speech to belittle and diminish others.”

The Jewish community has staunchly backed the act in the belief it offers protection from anti-Semitic attacks, but many libertarians believe it is an unnecessary curb on free speech.

Australia’s peak Jewish organisation has backed calls from Australia’s Race Discrimination Commissioner, Tim Soutphommasane, for the federal government to reverse its plans to repeal the key section of the Racial Discrimination Act.

Dr Soutphommasane warned in a speech this week that repealing Section 18C might “unleash a darker, even violent, side of our humanity”.

Mr Mundine said: “None of us can see what the problem is with Section 18C. But we can see the problems that would happen if it was pulled out. I was just going past a Jewish school today. It was like a military camp. There is a lot of anti-Semitism and other forms of racism.

“I do not believe this legislation has stopped freedom of speech. I speak quite freely, there is a lot of freedom, but it says there are certain lines we should not cross. I have told the Prime Minister I am not a supporter of this. It did come up last week and every conversation I have had I have made it clear this is the wrong way to go.”

The Australian understands there has been strong lobbying in Canberra this week for the government to abandon its plan to repeal the section.

Delivering the Alice Tay Lecture in Law and Human Rights, Dr Soutphommasane said the current laws had worked well and there was no compelling case for change.

“The danger of dismantling Section 18C is that it may license racial hatred,” he said.

“It may encourage people to think there is no harm in dealing out racial vilification.

“It may unleash a darker, even violent, side of our humanity which revels in the humiliation of the vulnerable,” Dr Soutphommasane pointed out.

Human Rights Commissioner Tim Wilson doesn’t agree.

Mr Wilson said the law had had the effect of shutting down legitimate public policy debate “because someone’s tone could be deemed inappropriate”.