SYDNEY: Australia is negotiating a deal with the Philippines to transfer asylum seekers being held indefinitely in controversial detention centres on remote, impoverished islands, Australia's immigration minister said on Friday.

Asylum seekers have long been a contentious political issue in Australia, although it has never received anywhere near the number of refugees currently flooding into Europe as they flee conflict in the Middle East and North Africa.

Successive Australian governments have vowed to stop asylum seekers reaching the mainland, turning boats back to Indonesia when it can and sending those it cannot for detention in camps on Manus island in Papua New Guinea and on the tiny South Pacific island of Nauru.

Harsh conditions at the camps, including reports of systemic child abuse, have been strongly criticised by the United Nations and human rights groups.

Former prime minister Tony Abbott, ousted in a party-room coup last month, struck a deal last year with Cambodia under which it would get A$40 million ($29 million) in additional aid from Australia for accepting asylum seekers, regardless of the total number.

However that deal has struggled, with Cambodia threatening to pull out of the agreement after taking only four refugees from among the hundreds held in PNG and Nauru.

Immigration Minister Peter Dutton said Australian Foreign Minister Julie Bishop had spoken with her Philippines counterpart about a similar deal, but declined to elaborate.

"We have a bilateral arrangement with Cambodia. If we can strike other arrangements with other countries, we will do that," Dutton told reporters.

"If we can strike an agreement that is in the best interests of our country and from the Philippines' perspective, their country, we will arrive at that point," he said.

Australia's highest court this week began considering whether the policy of sending asylum seekers to Nauru for long-term detention is in breach of the constitution, a major challenge to the controversial policy.

New Australia Prime Minister Malcolm Turnbull said last month he was concerned about conditions in the camps but gave no indication of a major policy change.

Australia has defended its detention policy as necessary to stop deaths at sea. No one processed at the Nauru or Papua New Guinea camps is eligible for settlement in Australia, even if they are found to be genuine refugees.

An independent U.N. investigator postponed an official visit to Australia last month, citing a lack of government cooperation and "unacceptable" legal restrictions.

Some investors in the company that runs the camps, Transfield Services Ltd (TSE.AX), have also said they will push for greater transparency and oversight.