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The Home Secretary asked officials to study sending asylum seekers to isolated islands 4,000 miles from the UK, according to reports.
It is understood that public officials were asked to investigate how other countries manage their immigration systems.
Australia is a model, keeping asylum seekers abroad while their applications are processed.
The Financial Times reports that Ascension Island and Saint Helena were considered in the South Atlantic.
The locations suggested by the Foreign Ministry were said to be implausible.
Saint Helena and Ascension are tiny islands about 800 miles apart in the middle of the ocean, roughly halfway between Africa and South America.
Shadow Labor Home Secretary Nick Thomas-Symonds tweeted: “This ridiculous idea is inhumane, completely impractical and outrageously expensive. So it seems entirely plausible that this Conservative government came up with it.”
An Interior Ministry source told Sky News: “As ministers have said, we are developing plans to reform policies and laws on illegal migration and asylum to ensure that we can provide protection to those in need, while preventing the abuse of the system and criminality “. associated with it. “
Immigration and asylum remain a contentious issue, with more than 5,000 people crossing the English Channel so far this year, most in small inflatable boats.
A record 416 Made the trip in one day in early September.
Prime Minister Boris Johnson has called the UK a “target and magnet” for human traffickers and promised to change the law to help tackle the crisis.