Opposition leader Tony Abbott is proposing to build a tent city on Nauru housing at least 2000 people for around five years.
Immigration Minister Tony Burke says while the plan is not without some merit, he says signalling the number of asylum seekers that can be processed on Nauru gives the people smugglers a target to exceed.
"Be in no doubt people smugglers want to know what the figure is they could then overwhelm. They want to know that. To put the figure of two thousand on it at a time where people smugglers in the current surge are getting more than a thousand people a week means that effectively the Coalition are putting up in lights 'If you want to overwhelm the policy, here's how'"
At least 2000 people would be sent to a new camp to be built by the coalition if it wins government, but thousands more would be located elsewhere, with no guarantee of final settlement in Australia, Coalition immigration spokesman Scott Morrison says.
The Australian Lawyers Alliance spokesman Greg Barns says he is particularly critical of the coalition's plan to expand processing facilities on Nauru when there are adequate facilities to assess asylum claims in Australia.
"For a developed world government in an extremely wealthy country to be talking about setting up a tent city for refugees is extraordinary," he says.
"I think it certainly indicates that when it comes to asylum seekers, there is no limit to the way in which both major political parties will strip people of dignity and rights."
Mr Abbott said the tent city idea was simply the coalition sticking to its guns, and he didn't need to inform Nauru of any new policy because it was a clear stance it had had for a decade.
He brushed off concerns that asylum seekers could end up living in temporary accommodation for a long time, saying he'd been to Nauru and it was a "pleasant island".
"Nauru is by no means an unpleasant place to live," he told the Seven Network. "Over time, you would have better facilities."
The Australian Greens have accused both sides of federal politics of trying to compete against each other for the toughest offshore processing policy for asylum seekers.
It comes after the coalition announced it would house at least two thousand people for up to five years in a new camp on Nauru if it won government.
The Rudd government recently announced plans to expand the offshore processing of asylum claims on Manus Island in Papua New Guinea under a deal with the P-N-G Government.
Greens Leader Christine Milne says the major political parties are harming Australia's reputation as a defender of human rights by pursuing inhumane policies.
"It is time that this cruelty stopped. It's time that Kevin Rudd and Tony Abbott stopped this appalling attempt to outdo each other with cruelty and barbarism in the hope that it will win more votes."
