But the opposition says the tragic event should not be used for political purposes.
Indonesian authorities confirmed at least seven deaths late yesterday, saying the vessel went down just hours after leaving from a port in Central Java.
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The toll is expected to rise, with more people still missing.
Immigration Minister Chris Bowen says the boat, which was well inside Indonesian waters, was clearly heading towards Australia and has called on the opposition to support government legislation legalising offshore processing.
Opposition Leader Tony Abbott said people smugglers were responsible for the tragedy.
"My understanding is that Scott Morrison and Chris Bowen had an informal agreement not to go out and politicise this," he told Macquarie Radio.
"(But) we had a junior government minister (Home Affairs Minister Brendan O'Connor) come out and try and say the coalition had blood on its hands.
"This is again the kind of thing that we get from a really desperate government that wants to blame everyone but itself for the problems that it is facing ...
"This is a tragedy, it is a terrible, terrible tragedy, and the only one that we can blame for this are the people smugglers."
Even prior to the news on the boat arriving, the federal government yesterday put aside their differences on asylum seeker policy to strengthen anti-people smuggling laws.
The move comes in the face of a legal challenge to be heard later this week.
ATTACK ON ASYLUM SEEKERS: GREENS
The Australian Greens say it is yet another attack on asylum seekers, being pushed through parliament without proper scrutiny.
The legislation passed by the lower house on Tuesday evening clarifies laws that criminalise people smuggling.
It will make it illegal to organise a group of five or more people to come into Australia without them having a "lawful right" to do so - that is, without having a valid visa or being excepted, as New Zealanders are.
This will apply retrospectively to the date the Migration Act was changed by the Howard government in 1999.
Home Affairs Minister Brendan O'Connor told parliament this would make it easier to prosecute people smugglers and would send "a clear message that the Australian parliament does not tolerate people smuggling".
Greens MP Adam Bandt told the house the bill was being pushed through so quickly to stop a court case that will be heard in the Victorian Court of Appeal later this week which challenges the people-smuggling laws.
"Because this case is coming up we now have an instance where this bill is being rammed through without any proper scrutiny," he told parliament.
"We have another instance of Labor and the coalition working together to diminish the legitimate right of people coming to this country to seek asylum."
Independent MP Rob Oakeshott also expressed concerns about the speed with which the legislation was passed.
Mr O'Connor said there had been "significant consultation" between the government and the opposition and Greens regarding the bill's importance.
Mr O'Connor was at pains to say the bill did not affect the rights of people seeking asylum, only those who tried to make profit from bringing them to Australia.
Opposition border protection spokesman Michael Keenan said it was "clearly important" for the meaning of the law to be clarified.
His colleague, immigration spokesman Scott Morrison, said while there was disagreement between the major parties about how to deal with boat arrivals, there was agreement on this point.
"It's people smugglers who are responsible for deaths at sea," he said.
"It is not illegal to seek asylum; it is illegal to enter Australia without a valid visa."
The Deterring People Smuggling Bill 2011 passed 54 minutes after it was introduced into the House.
It now goes to the Senate for approval.
