Asylum seekers arriving in Australia will no longer automatically be locked up, under a new, "more humane" policy announced today.

After almost a decade of controversy surrounding its draconian treatment of refugees, Kevin Rudd's Government has over-turned the detention system which has seen some asylum seekers held in camps for years.

Detention in often remote immigration jails will now be used only as a last resort, said Chris Evans, the Immigration Minister.

"Desperate people are not deterred by the threat of harsh detention. They are often fleeing much worse circumstances," he said in a speech at the Australian National University.

A person who poses no danger to the community would be able to remain there while their visa status was resolved and one of the most controversial aspects of the policy – holding children and their families in detention centres – would be scrapped, he said.

"This isn't about a mass opening of gates, this is about a more humane treatment of asylum seekers, a more humane detention policy," said Mr Evans.

The move by Mr Rudd's centre-left Labor government is the latest in a series of manoevres to relax the country's notoriously harsh treatment of asylum seekers.

In February, the Government kept an election promise to scrap the so-called "Pacific Solution" under which boat people were sent to special detention centres in the Papua New Guinea island of Manus, and the tiny Pacific state of Nauru.

The policy was established in 2001 by Mr Rudd's predecessor, the conservative Prime Minister John Howard, after the infamous “Tampa affair” in which 439 mostly Afghan refugees were prevented from landing in Australia by special forces soldiers.

The Afghans had been rescued at sea by the Norwegian freighter MV Tampa after their fishing vessel sank in international waters on its way to Australia. However they were left marooned off Christmas Island for weeks in a controversial stand-off with the Howard government which refused to allow them to set foot on Australian soil. In the end they were transferred to Nauru.

The Pacific Solution has been strongly criticised by rights groups and the United Nations High Commissioner for Refugees (UNHCR), which accused Canberra of breaching refugee convention responsibilities.

The Australian government’s tough stance on asylum seekers has been in place since September 1992 when all people arriving without proper travel documents have been immediately detained until they are granted a correct visa or deported.

But since the Tampa incident the asylum policy has been dogged by controversy. A German-born Australian resident, Cornelia Rau, was mistakenly detained for 10 months between 2004 and 2005, and an Australian citizen, Vivian Alvarez Solon, was mistakenly deported to the Philippines.

At the height of the furore surrounding mandatory detention, refugees staged protests at detention centres around the country, sewing theirs lips shut and staging hunger strikes in protest about their treatment.

The detention centres at Woomera and Baxter in outback South Australia have since been closed and refugees are now sent to a $400 million centre on remote Christmas Island, in the Indian Ocean between Australia and Indonesia.

Amnesty International today welcomed the announcement, saying the latest changes would see the release of almost 380 asylum seekers currently in Australian detention.

"Obviously what we're hearing is very good. Australia is the only country that has mandatorily detained anybody who has arrived without a document, and up until 2005 that included families with children," spokesman Graham Thom said

Mr Evans said the government would retain detention in a limited form for boat arrivals to pose a deterrent to people smugglers, but officials would have to justify why illegal arrivals posed a risk requiring confinement.

Since taking over the immigration portfolio last year, he said he had reviewed the cases of 72 detainees who had been held for more than two years. Of those, 31 should not have been detained and were on their way to getting visas.

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