Australia's Environment Minister Peter Garrett was stripped of key responsibilities yesterday over a botched home insulation scheme that left four workers dead and heaped pressure on the government.

The former frontman for rock band Midnight Oil was demoted to Minister for Environment Protection, Heritage and the Arts, losing his energy efficiency role.

"There's no point sugar-coating this: it does mean a reduced range of responsibilities for Mr Garrett," Prime Minister Kevin Rudd told reporters, acknowledging "serious problems" in the scheme.

"No one would doubt his passion for protection of the environment itself, and therefore this change in responsibilities better enables him to focus in those areas," he added.

Mr Rudd had stood by Mr Garrett as calls for his resignation grew over the project, which provided free insulation for about one million homes, after three people fitting the material died from electric shocks.

A fourth worker collapsed and died from heat exhaustion while working in a roof cavity in November. Dozens of house fires were also blamed on poorly-fitted insulation.

Mr Rudd has accepted ultimate responsibility for the scheme, which Mr Garrett was forced to stop last week after ordering safety checks on thousands of properties.

The energy-saving measure was a centrepiece of Mr Rudd's environmental programme along with carbon-trading legislation, which has twice failed to pass Parliament, boosting the opposition in an election year.

Mr Garrett, whose 1987 hit "Beds Are Burning" has become an anthem for the anti-climate-change movement, won a Labour Party seat in 2004 and was handed the environment portfolio after Mr Rudd's 2007 election win.

Once an anti-nuclear campaigner and activist rocker, Mr Garrett shed his radical image to run for Parliament in 2004, leading some fans and the country's conservative opposition to accuse him of selling out.