Nationals' leader Barnaby Joyce called a press conference to back away from the full scale of the policy ambition outlined by his deputy Fiona Nash at the National Press Club a day earlier, nominating several key departments that would not be moved to the regions.

But it remains unclear if the departments of Treasury, Agriculture and Finance would have to justify their continued presence in the capital and if other large Canberra-based operations would be subject to cost-benefit-analyses or policy templates to determine if they can be forced out of town.

Mr Joyce's intervention came as the criticism of the scheme from Canberra business, academic and political leaders heightened, including friendly fire from the Coalition's local senator and the leader of the Canberra Liberals.

There is uncertainty over which Commonwealth employers fall under the scope of the policy after Senator Nash refused to limit options on Wednesday but Mr Joyce ruled out certain moves on Thursday.

"You will have the vast majority of government, your Taxation Department, Treasury and Finance will be in Canberra," he told the press conference.

"We won't be moving the Treasury Department to Albury.

"That is obvious."

But ministers will still be given until August to report back to Cabinet on which of their departments, agencies and other entities are considered suitable for relocation, with Mr Joyce and Senator Nash warning they will be expected to "actively justify" why any agency is unsuitable for relocation.

Business cases are expected to be with government by December.

But the backlash from Canberra against the policy continued from into Thursday with the Property Council of the ACT saying the Nationals' plan look like it "hadn't been well thought out."

The council's executive director Adina Cirson said Commonwealth tenants accounted for 55 per cent of the city's office market.

"To rip that out of Canberra would be absolutely devastating, not only to Canberra but to the whole region and we have million people who use Canberra as a regional centre," Ms Cirson said.

"There's no rhyme or reason to what has been proposed, the experiment being carried out with Armidale shows there are no cost efficiencies to government."

Ms Cirson said the latest business confidence survey had shown Canberra going from "strength to strength" but that she expected Wednesday's announcement to send shockwaves through the city's commercial community.

"I would bet money that when we do that survey again in June, that certainty will be gone from the market and that is very dangerous for the Canberra economy," she said.

Stephen Byron, chief executive of Canberra Airport which has major public service departments among its tenants, said the decentralisation push out of Canberra was proving to be unsustainable.

"When you're seeking to move public servants out of Canberra, you're getting an 80 to 90 per cent attrition rate in the organisation," Mr Byron said.

"It's completely unsustainable for a government that wants to govern well and implement its policies, to be moving chunks of itself and stripping out 80 to 90 per cent of its capabilities.

Canberra Liberals Leader Alistair Coe said he was "very concerned by the announcement" while Liberal Senator for the ACT, Zed Seselja, said departments would be wasting their time justifying their capital city presences.

But Senator Seselja's strong criticism of the plan has surprised some on both sides of the Liberal-National Coalition, with one colleague who asked not to be named, noting even Labor Chief Minister Andrew Barr had been more measured in his response.

Senator Seselja, a former territory opposition leader who is now Assistant Minister for Social Services and Multicultural Affairs, has spoken out in the past against Coalition cuts to the national capital.

But on Thursday, another government source noted MPs who accept sought-after frontbench positions were required to take on the responsibilities associated with the job, including defending policies of the government.