Australia’s Costly Asylum-Seeker Policy Contributes to Nation’s Deficit Woes

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Paula Bronstein / Getty Images

Detainees walk inside the Immigration Detention Center on Christmas Island, Australia, on Feb. 25, 2012

When Australian Treasurer Wayne Swan delivered the national budget yesterday, he blamed the nation’s $17.8 billion deficit on the stubbornly high Australian dollar, softening company-tax revenue and a slowdown of the China-driven mining sector. But an estimated $2 billion to $3 billion of that deficit (the true figure won’t be known until September) comes from the blowout of the government’s controversial border-protection budget. 
And for that there’s nothing and nobody to blame but the ruinously expensive policy known in Australia as the “Pacific Solution.”

Conceived as a deterrent against illegal immigration by former Prime Minister John Howard in 2001, the policy has seen thousands of mostly Afghani and Iraqi boat people intercepted at sea after leaving Indonesia on rickety boats. They are then interned at offshore detention centers — essentially squalid tent cities — in Pacific backwaters like Nauru and Papua New Guinea’s Manus Island, which are breeding grounds for malaria and mental illness.

The solution was described as “costly, unsustainable and wrong as a matter of principle” by current Prime Minister Julia Gillard when in opposition in 2003 and suspended when her party was swept to power in 2007. But following a sharp increase in boats — attributed in part to a new wave of Tamil asylum seekers fleeing poverty and persecution in Sri Lanka — Gillard reintroduced the Pacific Solution in August.

(MORE: Why Does Australia Want to Send Refugees to Malaysia?)

As a deterrent, the policy is a failure: the boats have kept on coming and then some. Stretched to breaking point, Australian naval and police vessels have plucked more than 20,429 asylum seekers from leaky fishing boats in the Indian Ocean since the start of this financial year on July 1.

Based on current projections, the opposition has predicted the cost of border protection under the Pacific Solution will rise as high as $6.38 billion across the next three years — a $5.18 billion overspend on the $1.2 billion Swan originally budgeted for the same period. Australia’s foreign-aid budget will be raided to make up some of the shortfall. Some $374.6 million was plucked from that kitty in December 2012, and Foreign Minister Bob Carr announced on Monday that Australia would defer its pledge to lift foreign aid to 0.5% of gross national income by 2015, in order to make savings of $3 billion over two years.

In another attempt to soften the fiscal impact of the Pacific Solution, Immigration Minister Brendan O’Connor announced last week that boat people arriving with children would be considered for bridging visas and released into the community. The backflip followed a damning exposé by the state-funded Australian Broadcasting Cooperation on the appalling and unsafe conditions at Nauru and Manus Island, with the Australian Medical Association describing the placing of 1,062 children in detention as a form of child abuse.

(MORE: Australia: Refugees Killed in Christmas Island Shipwreck)

Despite the financial and ethical difficulties involved, Australia’s opposition has vowed to toughen border security if, as a long run of polls have predicted, it wins the upcoming federal election on Sept. 14. Promises by opposition leader and Liberal Party boss Tony Abbott to “stop the boats” include measures like preventing asylum seekers from appealing failed asylum claims, ending free legal advice and ordering the navy to turn back the boats — a move former navy chief David Shackleton has described as “dangerous.”

While Abbott continues to trumpet Treasurer Swan’s alleged $5.18 billion border-protection black hole, his party has failed to say how it will hedge costs. 
“Unless the opposition puts time limits on the length that refugees will remain in detention, costs will keep on ballooning,” Greens Senator Sarah Hanson-Young tells TIME. A key parliamentary ally of the Gillard government — and one that has endlessly taken it to task over Australia’s humanitarian and legal obligations under the U.N. Refugee Convention — the Greens want the detention centers at Manus Island and Nauru shut down and for asylum seekers to be released into the community as quickly as possible.

Current and future governments — and Australian taxpayers — should pay attention, if only for the bottom line. “We have worked out it costs 600 Australian dollars [$599] a day to detain an asylum seeker offshore,” Hanson-Young says. “If you then assume they’re kept there for a minimum of 5 years as current policy dictates, it comes to 1.2 million Australian dollars [$1.2 million] per person, which is just ludicrous. But if they’re allowed to live in the community while their claims are assessed, we have worked out the cost to be 38 Australian dollars [$37.95] a day.” The only problem is that such a policy is likely to prove unpopular with voters: a July 2012 poll found that 60% of those surveyed considered the Labor government’s handling of asylum seekers “too soft,” and that those backing the opposition’s approach to the problem outnumbered supporters of Labor’s approach more than 2 to 1. The Pacific Solution is proving costly for Treasurer Swan and the Labor Party. Ending it could prove even costlier.

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