Immigration Minister Scott Morrison has introduced legislation to parliament that resurrects temporary protection visas.
Regional communities struggling to find workers are the likely beneficiaries of sweeping changes to migration laws.
Thousands of asylum seekers could be released into regional areas to clear a backlog of 30,000 unprocessed claims.
Under legislation introduced to parliament on Thursday asylum seekers will be able to apply for a three-year temporary protection visa or a five-year safe haven enterprise visa.
The draft laws also aim to head off High Court challenges against boat turn-backs, claims by asylum seeker children born in Australia and human rights breaches under the UN Refugee Convention.
The return of temporary protection visas, a Howard-era measure abolished by Labor in 2008, comes after the government struck a deal with the Palmer United Party.
“It’s a game changer for our country,” leader Clive Palmer told reporters in Brisbane.
Asylum seekers who opt for the safe haven visa will be required to confine themselves to designated regions.
Those on TPVs will be allowed to live, work and claim welfare benefits wherever they please.
Labor fears people will be locked in permanent limbo, living their lives as “marginalised residents”.
The visas will not be available to asylum seekers in detention on Nauru and Manus Island in Papua New Guinea.
Mr Morrison insists both visas will be temporary and not a pathway to permanent residency.
But people on safe haven visas may get access to other visas, like those for skilled workers.
The legislation also closes off access to the Refugee Review Tribunal in a bid to discourage unmeritorious claims, fast track asylum-seeker claims and speed up removal of people who aren’t owed protection.
The deal with PUP opens the door for 1500 asylum seekers on Christmas Island, including 436 children, to be released from detention.
The government will stop transfers from Christmas Island to Nauru once the legislation clears parliament, likely in late November.
While Mr Morrison would not rule out transfers in the interim, he said there were no immediate plans so long as “everyone acts in good faith”.
Greens senator Sarah Hanson-Young took that as a threat to asylum seekers and the crossbench.
“He’s holding people to ransom,” she told reporters.
The Human Rights Law Centre said Mr Morrison’s trumpeting of TPVs was just the tip of the iceberg.
“Lurking beneath the surface is a suite of appalling reforms which impact on the way asylum seekers will be treated both here and at sea,” spokesman Daniel Webb said.
With PUP’s support the government has three of the six crossbench seats it needs to have its measures pass the Senate against opposition from Labor and the Greens.
HOW THE GOVERNMENT PLANS TO PROCESS ASYLUM SEEKERS WHO HAVE ARRIVED IN AUSTRALIA BY BOAT:
* Reintroduce temporary protection visas.
* Create a new visa class to be known as a safe haven enterprise visa.
* Create a new fast-track assessment process and remove access to the Refugee Review Tribunal for fast-track applicants.
* Remove most references to the United Nations Refugees Convention from the Migration Act and replace them with a new statutory framework which articulates Australia’s interpretation of its protection obligations under the convention.
* Statutory limit on the number of protection visas in each year.
* Tighter circumstances test for the “well-founded fear of prosecution” claim for protection.