Australia's Labor government will increase the yearly intake of refugees to 20,000 from 13,750. However, the almost 50 per cent hike would be based on the condition that the refugees are processed offshore.

Reports said that more than 900 refugees were bound for Australia in November, the highest number since Labor took office. On Friday, two boats with asylum seekers on board were picked up off Christmas Island.

The opposition criticised the proposal made by Immigration Minister Chris Bowen. Opposition immigration spokesman Scot Morrison warned that hiking the refugee intake by almost 50 per cent would strain current resettlement programs and affect the federal budget by about $1.4 billion.

"I agree with Chris Bowen that Australia does have the most generous refugee and humanitarian settlement program in the world.... The issue of increasing it is a very different matter," The Sydney Morning Herald quoted Mr Morrison.

Although the coalition supported Labor's stand on offshore processing and proposed an amendment to allow offshore processing with nations that have inked the UN Refugee Convention, Mr Morrison lamented that Labor did not engage with the coalition on hiking the number of refugee intake.