Asylum seekers on boat
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Australia asylum panel recommends offshore processing

13 August 2012 Last updated at 16:59 BST

Australia should set up offshore processing centres for asylum seekers in Nauru and Papua New Guinea, and pursue a refugee agreement with Malaysia, a panel has recommended.

The three-strong independent panel was appointed by PM Julia Gillard to break government deadlock on the issue, but critics argue that offshore processing is "inhumane".

Duncan Kennedy reports.