As the Government steps up its campaign to push nuclear energy in Australia, the debate about nuclear waste has also stepped up.
Mr Macfarlane said the states, which oppose housing a nuclear waste dump, needed to be frank about what they were doing with their waste.
"I know each state health system has nuclear waste," Mr Macfarlane has told Network Ten.
"Are they storing it, as it's suggested in one case, in a shipping container in the car park of their general hospital?"
Mr Macfarlane refused to name the state or provide any further details on the allegation.
"Why are they frightening people by saying nuclear waste is so dangerous when they are not even storing it in a secure environment in some cases."
The Government is almost certain to create a nuclear waste dump in the Northern Territory for low and medium-level radioactive waste.
This includes material such as needles, surgical gowns and other material used in the treatment of cancer.
"Nuclear waste, these days, is an item which can be stored in a very secure manner," Mr Macfarlane said.
Prime Minister John Howard is a keen supporter of the debate on nuclear energy and he has said nuclear power stations would be a good answer to the pollution problems of coal-fired power stations which currently provide Australia's electricity base load.
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