THE federal government spent more than $5 million on the failed Malaysia deal and is yet to budget for the expected increase in boat arrivals following the collapse of offshore processing.
The Immigration Department secretary, Andrew Metcalfe, also told a Senate committee that detainees already rejected as refugees are likely to be among those granted bridging visas after a government policy shift.
Mr Metcalfe said bridging visas were cheaper than detaining people for long periods and reduced the risk of the Commonwealth being sued for wrongful imprisonment.
But he warned many asylum seekers will be unable to find jobs even if granted work rights, as they do not speak English.
And, if asylum seekers on bridging visas pass a means test and are declared destitute, they will receive financial support from the government, it has emerged.
The government had spent $360,000 refurbishing motels in Malaysia, almost $50,000 on rent, $4.6 million in operating costs, $272,000 on its legal defence in the High Court and another $200,000 on ''accrued costs'' before the Malaysia deal was declared illegal.
Despite the immigration department already exceeding its budget forecast of 750 people arriving by boat this year - more than 940 have arrived - it is yet to forecast the impact of the deal's collapse on the federal budget. Mr Metcalfe told the committee the increased cost would be ''significant'', and was being worked out.
Under questioning from the Liberal Senator Michaelia Cash, Mr Metcalfe said the department had chosen to reduce its forecast in the Budget for refugees arriving this year to 750 - ''based on figures in the Budget in 2002-03 following the Pacific strategy''.
Shedding further light on the federal government's decision to shift to community housing once the detention network reaches capacity, immigration officials told of long delays in processing existing detainees.
It will take another two years before rejected asylum seekers can be considered for removal overseas because of the length of time needed for 734 rejected Afghans to exhaust the judicial appeals process, officials said.
The only way to stop asylum seekers appealing to the Federal Court was a referendum to change the constitution, the committee was told.
The Immigration Department deputy secretary John Moorhouse said 451 detainees were diagnosed as mentally ill; 228 were on anti-psychotic medication and 527 on anti-depressants.
Capacit y in the country's detention network will be reduced when the lease on the Scherger centre in Queensland and Pontville expires next year, the committee was told.
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