Opposition Leader Tony Abbott is refusing to accept blame for the government's decision to temporarily abandon plans for the offshore processing of asylum seekers.
But the government insists the Coalition is adopting a short-sighted approach to changes to the Migration Act that aim to resurrect the Malaysia people swap deal.
Mr Abbott is not giving ground on the issue, telling the government if it was serious about offshore processing "they could have it tomorrow".
"All they have to do is accept the opposition's amendment," he told ABC Television.
The Coalition says it will back Labor's migration law changes, provided offshore processing is limited to third countries that have signed up to the UN refugee convention.
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Malaysia is not a signatory to the convention.
Labor does not have the numbers to clear its changes through parliament's lower house, after losing the support of key crossbenchers and the Australian Greens.
Mr Abbott said resolving the impasse was the government's responsibility.
"This matter is entirely of the government's making," he said.
The government has decided to put its legislative changes on hold until it secures Coalition support. In the meantime, it will allow more asylum seekers to stay in community detention, in response to an expected surge in boat arrivals.
Mr Abbott took aim at Prime Minister Julia Gillard blaming her stubbornness for the government's dilemma.
"She should have known weeks ago that the Malaysia people swap was dead," he said.
"She has never had a plan B."
But Immigration Minister Chris Bowen defended the government's record, including striking a deal with Malaysia despite it being quashed by the High Court in August.
Mr Bowen said the court's decision also ruled out the coalition's preferred options of Nauru and Papua New Guinea.
"It just underlines the short-sighted nature of the Liberal Party's approach to this," he told ABC Radio.
Mr Bowen confirmed asylum seekers in detention now would be eligible for bridging visas that would allow them to live in the community.
Determinations would be made on a case-by-case basis, he said.
Human Rights Commissioner Catherine Branson welcomed the government's proposal to issue more bridging visas.
"We believe it will show over time there is no real impediment to handling all asylum claims while people live in the community," she told ABC Radio.
Refugee lawyer David Manne, who ran the High Court challenge against the Malaysia deal, said the government had to start playing by the rules of the UN refugee convention.
"That includes processing people's protections claim here in Australia instead of searching around the region to do the job for us," he said.
Human Rights Commissioner Catherine Branson welcomed the government's proposal to issue more bridging visas.
"We believe it will show over time there is no real impediment to handling all asylum claims while people live in the community," she told ABC Radio.
Refugee lawyer David Manne, who ran the High Court challenge against the Malaysia deal, said the government had to start playing by the rules of the UN refugee convention.
"That includes processing people's protections claim here in Australia instead of searching around the region to do the job for us," he said.
