The directive says applicants who arrive in Australia by boat will receive the lowest priority in the family migration scheme.
Mr Morrison has told SBS in a written statement that the measure was undertaken to ensure “that the limited places under our family reunion programme are not taken up by IMA [Illegal Maritime Arrival] families at the expense of other applicants.”
The move is retrospective, meaning applicants who are permanent residents in Australia and have been living here for years, will be affected.
Greens Senator Sarah Hanson-Young has slammed the move.
"This move is not acting as a deterrent,” the Senator told SBS. “It’s just cruelty for its own sake."
Refugee advocates are outraged, saying a ministerial directive is harder to challenge than legislation.
"Under the current move by the minister, it looks very unlikely that they [refugees who arrive by boat] will ever be reunited with their families," advocate and migration agent Marion Le says.
The body overseeing migration service providers, the Migration Institute of Australia, says it will be raising objections with the Minister.
"We'll certainly be making some comments and passing on our members' concerns to the minister,” Chief Operating Officer Kevin Lane says.
The changes came into effect on December 19.
Listen: Family reunion setback for refugees who came by boat, Thea Cowie and Shalailah Medhora reports
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