The prime minister has discussed a proposed raft of new counter-terrorism laws with internal groups as global outrage mounts over the beheading of American journalist James Foley in Iraq.

Abbott said the "hideous" act committed by an allegedly British terrorist highlighted the unique threat posed by homegrown extremists.

"This is not just something that happens elsewhere," he told reporters in Melbourne on Thursday.

"It could happen in countries like Australia if we relax our vigilance against terrorism and potential terrorism here on our shores."

Around 60 Australians are fighting with the so-called Islamic State of Iraq and the Levant (ISIL) - the terrorist outfit responsible for Foley's beheading - and other extremist groups in the Middle East.

About 100 more are involved in support networks for these terrorist organizations.

The government is gravely concerned about the risk these people pose if they return home trained in terrorism, and wants to spend $600 million beefing up security.

It's also proposed new legislation to give security agencies greater powers to access telecommunication data and to detain and jail people working with terrorists overseas.

Abbott has stressed the laws are aimed at terrorists and won't single out one community group.

Labor leader Bill Shorten expressed support for the laws but said civil liberties and multicultural values must be protected.

"We can't take our safety for granted," he told reporters.

But it's not just so-called homegrown terrorists who could pose a threat to national security. There are also some other foreign extremist groups who swore allegiance to ISIL and could orchestrate attacks on Western targets including the Bali bombings in 2002 that killed 88 Australians.

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