Australia's assistant minister for regional development and territories may extend the three month suspension of the Norfolk Island Regional Council.
Nola Marino initially suspended the Council from February for three months, citing its huge debts.
She said, at that time, the move came after an independent audit of the Council's financial viability - an audit the Council itself requested.
Ms Marino has said that this suspension may be extended.
But she has put back the elections for a new council until year.
A part time administrator, Michael Colreavy, was now handling the Council's work.
Hands up for democracy protest in Norfolk Island Photo: Facebook: Norfolk under siege
Canberra's action could arouse further local concerns around democracy, following the removal of the island's autonomy and Norfolk being an significant attachment to Bean constituency in the federal capital.
The island has no political representation in New South Wales despite the state running most government functions on Norfolk.
The Norfolk Island Council of Elders recently pleaded with Prime Minister Scott Morrison to intervene, to ensure the island's democratic rights were met.
In another move Marino appointed a commissioner to conduct a public inquiry into what happened at the Council.