The amendments to the Migration Act narrowly passed the lower house Friday morning after a stormy late-night debate in the upper house.

The "temporary protection visas" grant refugees protection for three years but do not give them the right to settle in Australia for good.

They could also be returned to their home country after a reassessment at the end of that period.

The government re-introduced the visas, used by previous conservative governments, to deal with a backlog of 30,000 asylum-seekers who arrived by boat.

However it also pledged to increase the overall refugee intake by 7,500 and free hundreds of children held in detention.

"This is a win for Australia," Prime Minister Tony Abbott said.

He confirmed that in a trade-off agreed by the government to get the bill through the Senate, about 470 asylum-seeker children will be among 1,500 people released from detention centres and placed in the mainland community.

Australia has come under international pressure over its offshore detention of asylum-seekers on its Indian Ocean territory of Christmas Island, where some children are held, and in Pacific camps as well as for the turning back of asylum boats. "We always said that three things were necessary to stop the boats -- offshore processing, turning boats around and temporary protection visas and last night the final piece of policy was put in place," Abbott said.

"This will enable the government to deal with the backlog of 30,000 people who came to Australia illegally by boat under Labor," Abbott told a press conference, referring to the previous government.

"These people, if they're found to be refugees, will receive temporary protection visas which means that no one coming to Australia illegally by boat can expect to get permanent residency."

Strong message to people smugglers

Immigration Minister Scott Morrison said, in another trade-off, the official quota of refugees allowed into Australia would increase to 18,750 a year.

"We have got stronger borders at sea because of the powers we've given our maritime agency," he told reporters.

"Not only the government has sent another strong message to the people smugglers about our resolve to end their business forever, but it has sent a strong message of resolve from the Australian parliament and that is something that will only further strengthen our country's borders."

New five-year safe-haven enterprise visas will also be brought in to encourage refugees to live in more remote areas with labour shortages.

The government negotiated Senate support for the legislation over bitter opposition from Labor and the Greens.

Greens Senator Sarah Hanson-Young accused the government of "using children as hostages" to persuade senators to back the bill.

The legislation reflects hardening attitudes Australian governments have taken against asylum-seekers attempting to enter the country on unauthorised boats. Those who do make it are sent to camps in Papua New Guinea and the Pacific state of Nauru and denied resettlement.

In November, Canberra also said it was slamming the door on UN-registered asylum-seekers in Indonesia, which has been a hub for refugees seeking to reach Australia. Those who arrived in Indonesia after July this year are no longer eligible for resettlement.

Only one boat has reached the Australian mainland since December, compared to almost daily arrivals previously under the Labor administration, when hundreds of people died en route.

The government's "Stop the Boats" policies include turning back asylum-seeker vessels approaching Australian waters.

The most recent case involved a people-smuggling boat carrying 38 Sri Lankans that was halted northwest of the Cocos Islands two weeks ago as it made its way to Australia. -AFP