A report handed down after an immigration detention inquiry says steps must be taken to limit detention to 90 days, to make sure asylum seekers' mental health is not impacted.
The Greens and the Opposition had established an investigation into last year's riots at Villawood and Christmas Island detention centres.
The committee, chaired by Labor's Daryl Melham, said its recommendations aim to build on the successes of government community detention and bridging visa programs already underway.
"To this end, the committee recommends that all reasonable steps be taken to limit detention to 90 days, and that where people are held any longer, the reasons for their prolonged detention be made public," it said.
Committee deputy chair and Greens Senator Sarah Hanson-Young said of the 5,000 or so people in detention, more than 62 per cent had been there more than 90 days and others for 18 months or more.
"That 90-day period is what medical professionals over and over again told this committee is the key benchmark by which people's mental health starts to deteriorate," Senator Hanson-Young told reporters in Canberra.
"If we can get people out of the system before that 90-day period ... by that 90-day period ... they will be much healthier people.
"Overwhelmingly they are found to be genuine refugees - over 90 per cent of people who arrive by boat are subject to this type of detention."
The report says there's far-more effective and cheaper ways to process asylum seekers.
The inquiry also calls for SERCO staff to be better trained to deal with critical incidents, and for health and medical staff to be rostered on for 24 hours at non-metro centres.
Ms Young also said the constant movement of asylum seekers from one detention centre to another made it difficult to track them down and may have detrimental impacts on minors.
Ms Young cited the example of a whole family-- including parents and their children -- being kept in detention because the parents were deemed to pose a security risk. She says the reasons behind their detention were impossible to dig out.
Shadow Immigration Minister Scott Morrison, presenting the Coalition's dissenting report into Australia's immigration, said the opposition remains committed to a mandatory detention policy.
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