Australia confident money to Cambodia will help

Australia on Tuesday dismissed concerns that money given to Cambodia to resettle refugees could end up in the pockets of corrupt officials as Phnom Penh moves closer to joining Papua New Guinea and Nauru in accepting asylum-seekers.

Cambodia has agreed "in principle" to take asylum-seekers bound for Australia despite controversy at the prospect of them being taken to one of Asia's poorest nations.

Canberra currently denies would-be refugees resettlement by sending them to Papua New Guinea and Nauru.

While a deal has yet to be signed with Cambodia, Australian Immigration Minister Scott Morrison said talks were progressing.

"We are having positive discussions, and I appreciate the response we are getting from Cambodia, but we have still got some distance to travel, and we are traveling that distance," he said.

Cambodian opposition leader Sam Rainsy blasted the move, saying his "impoverished" country was not able to provide for its own people, let alone would-be Australian refugees.

"I don't think that it would be realistic, appropriate and decent to send any refugees from Australia, or any camp under the control of the Australian government, to Cambodia," he told the Australian Broadcasting Corp.

"Because this country, Cambodia, is not prepared. It is not equipped to receive any refugee.

"I think it would be a disgrace," he added.

"A rich, powerful and respected country such as Australia must face its responsibility in dealing with this humanitarian problem."

Rainsy said he fears that any money Australia gives Phnom Penh could be siphoned off.

"Cambodia is one of the world's most corrupt countries. So any money, especially from any foreign source, would be diverted and channelled into the pocket of our corrupt leaders with very little, if any, benefit to the ordinary people," he said.

Morrison declined to say how much money it was offering Cambodia to take refugees, but insisted there would be safeguards to ensure the money was not misused.

"We are not in the business of lining the pockets of officials, we are in the business of providing legitimate settlement packages that will help people get on their feet," he said.

"So I dismiss those suggestions; I don't think that is a risk here.

"We have the experience, whether it is working in our aid program or working in resettlement programs to ensure that we can get the resources to the people who need it."

In its budget this week, Canberra estimated its tough policies to prevent illegal boat arrivals would reap savings of A$2.5 billion ($2.3 billion) over five years, with detention centers in Australia now being closed down.

It also announced that A$86.8 million would be given to Indonesia, where many of the boats originate from, to help it manage its asylum-seeker population.