The Federal Government has slammed the Opposition's announcement of boosted asylum seeker capacity on Nauru as "childish", accusing it of putting the centre's planned capacity "up in lights".

The Opposition has announced plans to build a tent city for up to 2,000 asylum seekers on the Pacific island if it wins office.

Under the five-year plan, announced by Immigration spokesman Scott Morrison last night via commercial TV news and in today's News Ltd newspapers, the island could also host a village for people granted refugee status.

Immigration Minister Tony Burke says it may have been a "first class" media strategy "but in terms of doing something about people drowning on the high seas - it's childish".

"You don't set a limit on capacity. The moment you do that you give people smugglers a target to fill," Mr Burke said.

Key points: Coalition wants to build a tent city to house 2,000 asylum seekers on Nauru

Coalition wants to build a tent city to house 2,000 asylum seekers on Nauru Under the plan, Nauru could also host a village for people granted asylum status

Under the plan, Nauru could also host a village for people granted asylum status The announcement comes amid preparations to expand the Manus Island detention centre

The announcement comes amid preparations to expand the Manus Island detention centre The Manus Island site will eventually house up to 3,000 asylum seekers

"And instead of it being a policy for five years, by putting that limit on capacity, it's effectively a policy for a fortnight."

Mr Burke also said the Coalition's choice of words in warning asylum seekers there was "no guarantee" of settlement in Australia had left the way open for just that.

"You cannot leave the window open to settlement in Australia," he said.

"That gives people smugglers a product to sell, and if they have a product to sell we all know the tragic consequences that follow."

Mr Burke said he had had discussions about a similar idea with the government in Nauru, but said he would not "rush to announcement" without thinking through the details.

"Unlike the Coalition, I don't meet with the heads of foreign countries and run off to media conferences before we've finalised arrangements," he said.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Listen Duration: 5 minutes 22 seconds 5 m Sabra Lane discusses the Coalition's announcement Download 2.5 MB

"There are a number of issues still under discussion and still having details finalised.

"The concept of expansion? Yes - discussed."

Morrison went to Nauru for talks with government

Mr Morrison travelled to Nauru yesterday to talk with the government there.

Earlier today he told ABC News 24 that the Nauruan government was interested in the plan to permanently house those found to be refugees.

"There needs to be post-assessment accommodation of a permanent nature," he said.

"We have identified this site some years ago and I visited again today and we've commenced the discussions in an informal way with the Nauruan government, on the basis that if we were elected, flagging these are the things we'd like to pursue.

Sorry, this video has expired Coalition plans expansion of Nauru processing facilities ( Lydnal Curtis )

"And we've had a good level of interest to that because it would leave a positive legacy for the Nauruan people, in that this accommodation would ultimately be used by Nauruans longer term as housing."

This morning Opposition Leader Tony Abbott brushed aside a question about whether his shadow cabinet had been consulted before Mr Morrison announced the plan.

"It doesn't need that consideration because it is existing policy," Mr Abbott said.

He said the Opposition had been clear about its policies on offshore detention for more than a decade.

"The Coalition's clear policy to stop the boats has involved rigorous offshore processing in places like Nauru," he said.

"What we are saying today is that because of the crisis on our borders that Kevin Rudd created ... we would be prepared to rapidly ramp up the capacity of Nauru to 2,000 and beyond.

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"But we would certainly expect as many as possible to be resettled in third countries as happened under the Howard government."

Greens leader Christine Milne has condemned the policies of both major parties, saying they are trying to outdo each other on cruelty.

"Now they're outdoing each other in the sense [that] the government [is] saying: 'there's no chance people will be able to be resettled in Australia'; the Coalition saying, 'there's no guarantee that they will be resettled in Australia'; and the government now saying, 'uh hah - the Coalition isn't as hard as us'," she said.

"Well I think it's disgraceful."

Asylum seekers damaged $60 million worth of infrastructure at the detention centre on Nauru during a riot earlier this month.

Former prime minister John Howard first announced offshore processing on Nauru and Papua New Guinea's Manus Island in 2001 as part of the so-called Pacific Solution.

It was dismantled by Kevin Rudd when Labor won government in 2007.

But in 2012, an expert panel, commissioned by the Labor government, advised that offshore processing should be reopened to curb the numbers of asylum seeker arrivals.

Nauru was reopened for the business of offshore detention late last year.

Before the July 19 riot the Immigration Department was working towards a capacity on Nauru of 900 asylum seekers. There are currently 545 people being held on Nauru in temporary accommodation, while the buildings are repaired and rebuilt.

Riot charges against 21 asylum seekers dropped

Mr Burke has also said Australia will never be able to take enough asylum seekers through its humanitarian program to stop people trying to come by boat.

"We're still dealing with a situation where Australia on its own will never be able to take so many people that no-one ever thinks to pay a people smuggler, that no-one ever thinks to put their life at risk on the high seas," he said.

Since the Government announced its policy of processing and settling refugees in Papua New Guinea, 17 boats carrying 1,312 asylum seekers have been intercepted by Australian authorities.

Meanwhile prosecutors in Nauru have dropped charges against 21 of the asylum seekers involved in this month's riot at the Australian-run detention and processing centre.

More than 150 of the detainees were charged after most of the centre was burnt to the ground.

In a statement, Nauru's resident magistrate Peter Law said 21 men have since been discharged.