LABOR'S Papua New Guinea Solution to stop boat arrivals has failed politically.

More importantly, the latest sinking of a people-smuggler boat off Christmas Island and the arrival of almost 3000 asylum-seekers since Kevin Rudd's dramatic announcement of the PNG deal mean Australia's response has failed practically.

The rate of arrivals is now so out of balance with the rate of banishments to PNG and the number of voluntary repatriations of asylum-seekers to Iran, Sri Lanka and Afghanistan, that the government cannot say all of the 3000-odd arrivals will not stay in Australia.

The object of the Prime Minister's July 19 announcement was to frighten people off setting to sea in leaky boats to seek asylum in Australia, so as to restore immigration control and stop deaths at sea.

It has not worked.

Rudd made no apology for "lurching to the Right" with his PNG deal or holding out the prospect of appalling and threatening living conditions for asylum-seekers who would never set foot in Australia, even if deemed to be refugees.

GRAPHIC: Fact Check

Indeed, Labor played upon such fears and based the PNG Solution on the premise that large capacity at Manus Island or elsewhere would not be needed because the asylum-seekers would be afraid to come.

It was designed to be a self-fulfilling policy of fear that meant the undefined costs of expanding PNG detention centres to a capacity of 3000 - a figure the government did not want to reveal - wouldn't be an issue because the expansion wouldn't be necessary.

In a reverse of the "build it and they will come" theory, Labor has worked on the basis that "they won't come so we won't have to build". It got an immediate boost in the polls on the handling of asylum-seekers and dared to think of "flipping" the issue into a positive for the government.

But the ability of people-smugglers to continue to fill boats and send people to Australia and their deaths, to the extent that even the future capacity of Manus Island is now overwhelmed, has stamped failure on the "solution".

Just as the suspension of Sri Lankan and Afghan refugee applications only served to create a backlog of refugee claims and clogged detention centres as boats continued to arrive, the illegal trade has adjusted once more to testing Australia's resolve.

Rudd and Immigration Minister Tony Burke never wanted to reveal a capacity target for people-smugglers, and were wary of suggesting there would be a sudden fall in boat arrivals.

The first arrivals were chalked up to the boats having left for the five- to seven-day trip before the announcement.

A lull in boat arrivals led Rudd to claim on August 12 that there had been a 30 per cent drop in illegal trips since the PNG Solution was announced and reports of "intelligence" about Iranians "asking for their money back" were cited as further success.

While claiming capacity to hold asylum-seekers at Manus Island was not a threat to the scheme, the government pulled out all stops to expand the facilities into a tent city to be able to keep its word of sending everyone who arrived since July 19 to Manus.

Despite the $37m advertising campaign and all the threats, more, and bigger, boats have arrived as the people-smugglers seek to overwhelm the government's capacity to keep its word.