Australian Prime Minister Malcolm Turnbull has rejected Wellington's offer to resettle refugees in New Zealand.

Turnbull snubbed New Zealand's renewed offer to resettle 150 refugees illegally held at remote Pacific camps despite the closure of one detention centre in Papua New Guinea, which has triggered a standoff between refugees and the Australian authorities.

The issue re-emerged when the Australian prime minister met his New Zealand counterpart Jacinda Ardern for the first time Sunday in Sydney.

Canberra has been forced on the defensive by the move from Wellington's new government, with Prime Minister Malcolm Turnbull saying Australia would instead prioritise a similar deal with the US to resettle refugees in the US, despite slow progress.

Australia had come under fire from the UN High Commissioner for Human Rights, with a spokesman in Geneva Friday calling on Canberra to move the refugees from Manus to Australia and criticising the offshore asylum processing policy as "unsustainable, inhumane and contrary to its human rights obligations".

"We urge the governments of Australia and Papua New Guinea to fully respect their human rights ... and to enter into a dialogue with the men to ensure these rights are duly respected, protected and fulfilled," the spokesman added.

About 600 detainees are refusing to leave citing safety fears if they move to transition centres where locals are reportedly unwelcoming.

But conditions in the camp are deteriorating with limited food and water and electricity cut off, with the United Nations warning of a humanitarian emergency.

Under its strict immigration policy, Canberra sends asylum seekers who try to reach Australia by boat to two camps, in Manus and Nauru, and they are barred from ever resettling in Australia.

Australia has struggled to move the refugees to third countries, such as Cambodia or Papua New Guinea.

"The offer is very genuine and remains on the table," Ardern told reporters after meeting Turnbull.

But the Australian leader replied that while he appreciated the offer, first made by Wellington in 2013, "we are not taking it up at this time."

"We have an arrangement with the United States ... so we want to pursue those, conclude those arrangements and then in the wake of that, obviously we can consider other ones," he said at the joint press conference.

Under the American deal, struck with previous US President Barack Obama and bitterly criticised by his successor Donald Trump, just 54 refugees have been accepted, with 24 flown to the US.

The agreement had envisaged resettling up to 1,250 refugees from Manus and Nauru to the US, but the vetting process has been slow.

Turnbull said his government had successfully stopped the arrival of asylum seeker boats and cited fears the people-smuggling trade could be restarted.

"Many of those people smugglers were trying to get people to New Zealand," he added.

Despite widespread criticism, Canberra has defended its policy.