On national Harmony Day, conservatives and moderates within the Coalition have reached a consensus on changes to the Racial Discrimination Act.
In the next fortnight, the government will introduce a bill to change the wording of section 18C.
Malcolm Turnbull says words like "insult" and "offend" are too subjective, while "harass" is a more legal term.
Announcing the change, the Prime Minister referred to the failed case against Bill Leak, the controversial cartoonist who died earlier this month.
"What we presented today strikes the right balance - defending freedom of speech so that cartoonists will not be hauled up and accused of racism, so that university students won't be dragged through the courts and pay out hundreds of thousands of dollars of legal costs imposed on them over spurious claims of racism. The time has come to get the balance right, to get the language right, to defend our freedom of speech and defend Australians with effective laws, clear laws, against racial vilification."
The government says the change in wording does not weaken the law.
Malcolm Turnbull says section 18C has lost its credibility, and needs to be replaced with less ambiguous language.
But many ethnic community groups remain staunchly opposed to any change.
The president of the United Indian Association, John Kennedy, says his members see the reform as eroding protection from hate speech.
"We want better protection for our community. And section 18C was giving a little bit of that. But now that it is watered down, it may send the wrong signal to other people that they can abuse and get away with it."
The government will also try to change the powers of the Human Rights Commission, so cases with a low chance of success can be thrown out more easily.
Opposition leader Bill Shorten has indicated Labor might support those procedural changes.
But he says the opposition will vote against any re-wording of the law.
"It's easy to dismiss a hurt that you won't feel. It's easy to weaken a protection that you'll never need. But this is not leadership, this is not what Australia's about. The only two cases that the Prime Minister held up today as his rationale could be solved by improving the process, not by changing the law. This isn't about free speech, it's about the Prime Minister appeasing his party. How much more will Australia throw overboard to save one man's job? Labor will never support the right to be a bigot."
With Labor and the Greens opposed to the changes, the government will need the support of the senate crossbench.
Derryn Hinch and David Leyonhjelm say they will vote with the Coalition.
But key crossbencher Nick Xenophon has suggested his bloc of three senators will not - which would tip the balance against the reform.
