The Department of Home Affairs says HMAS Maitland spotted the boat early this morning. It is being taken to Christmas Island so passengers can undergo security, identiity and health checks. The Federal Opposition says the boat shows people smugglers do not take the holidays off.

The Opposition's spokesman on border protection, Michael Keenan, says stronger policies are needed to deter people smugglers. "We need to return to the policies that have worked in the past, and that is a return to a form of temporary protection visa," he said.

"Qe need to turn the boats around if it is appropriate and safe to do so, and finally we need to have a proper policy of offshore detention because of course being brought to the Australian mainland is exactly what the people smugglers can sell."