One week after surviving an insurgent attack from his own backbench, Prime Minister Tony Abbott has switched his gaze to homegrown terror, saying we should not let “bad people play us for mugs”.

Mr Abbott has signalled a major crackdown on border control amid growing concerns about the threat of terrorism attacks on Australian soil.

The PM, who will deliver a national security statement on Monday week, said the rise of Islamic State had seen new threats emerge, “where any extremist can grab a knife, a flag, a camera phone and a victim and carry out a terror attack”.

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Authorities on Friday confirmed police and a prayer hall were among targets uncovered by investigations into two alleged terrorists arrested in western Sydney last week.

A number of items were allegedly seized from the home of Omar Al-Kutobi, 24, and Mohammad Kiad, 25, including a machete, hunting knife and homemade Islamic State flag, as well as a video which allegedly shows one of the men vowing to launch an attack in the name of ISIL.

Mohammad Kiad (left) and Omar Al-Kutobi have been charged charged with terrorism offences. Photo: AAP

Both men have been charged with terrorism offences.

Al-Kutobi, from Iraq, is believed to have arrived in Australia in 2009 using another person’s passport, and was given a protection visa before being granted citizenship in 2013.

Kiad entered Australia in 2012.

“It’s clear to me, that for too long, we have given those who might be a threat to our country the benefit of the doubt,” Mr Abbott said in a statement on Sunday.

“There’s been the benefit of the doubt at our borders, the benefit of the doubt for residency, the benefit of the doubt for citizenship and the benefit of the doubt at Centrelink.

“And in the courts, there has been bail, when clearly there should have been jail.

“We are a free and fair nation. But that doesn’t mean we should let bad people play us for mugs, and all too often they have; well, that’s going to stop.”

Mr Abbott said the government was responding to the terror threat in Australia and abroad.

He said a review undertaken by state and commonwealth governments into the deadly Lindt cafe siege in Sydney’s Martin Place would be released soon.

“We are both determined to learn the lessons of this attack and will promptly take any necessary remedial action,” Mr Abbott said.

It has also emerged that Iranian-born self-styled cleric Man Haron Monis, who held a deadly siege in the Lindt cafe, was granted a visa in 1996 despite Tehran’s warnings about his criminal past.

Monis was on bail at the time of the Sydney incident for a string of charges, including sexual offences and abetting the murder of his ex-wife.

Australia’s terror threat level was raised last September and extensive raids carried out in Sydney and Brisbane to disrupt an alleged plot by IS supporters to abduct and behead a random member of the public.

Copenhagen attack ‘brutal’

Meanwhile Mr Abbott has condemned the “brutal” terror attack in Copenhagen, saying it is an affront to free speech.

Police forensics investigate the scene of the first shooting in Copenhagen, Denmark. Photo: AAP

Two people have been killed and five injured in two shootings in the Danish capital, with one attack targeting a cultural centre that was hosting a debate on Islam and free speech.

Later, Copenhagen police shot dead a man responsible for two fatal shootings.

Mr Abbott said the thoughts of all Australians were with the Danish people, and in particular the victims of the cultural centre shooting.

“As with the Charlie Hebdo atrocity in Paris, the Copenhagen attack is an affront to one of our most fundamental values –freedom of speech,” the prime minister said in a statement.

“We stand with the people and government of Denmark in confronting this cynical attempt to undermine that fundamental right.”

– with ABC/AAP