There are now more asylum seekers and refugees in Australia for medical treatment than remain on Manus Island and Nauru.

Home Affairs secretary Mike Pezzullo said 953 people had been brought to the mainland for medical care or to accompany family members, outnumbering the 915 people held offshore.

More than 500 refugees have been settled in the US and 822 people have voluntarily returned to their home countries, Mr Pezzullo told a Senate estimates hearing on Thursday.

There has been a massive surge in medical transfers from Nauru in the past nine months.

Just 35 were brought to Australia for medical treatment in the previous financial year.

This has increased more than ten-fold over the past nine months, with 461 people evacuated up until the end of March.

Scott Morrison is spending more than $185 million reopening an immigration detention centre on Christmas Island to accommodate medical transfers.

However, the Prime Minister plans to shut the centre down again in July, after repealing laws making it easier for refugees to receive medical transfers. That decision – announced in Tuesday’s federal budget – led the Refugee Council of Australia to label the Christmas Island move a “cruel political stunt”.

Taxpayers spend about $1 billion a year maintaining Australia’s network of offshore processing centres.

An investigation has been launched into a controversial $423 million contract given to security company Paladin on Manus Island.

Australia’s auditor-general is investigating whether the Home Affairs Department “appropriately managed the procurement of garrison support and welfare services for immigration processing centres”.

Mr Pezzullo said he welcomed the audit, noting his department was also undertaking an internal review into the contract.

Paladin provides garrison support and welfare services for Australia’s offshore detention regime on Manus Island. That costs $20 million a month.

The little-known company, whose Australian arm was until recently registered to a beach shack on Kangaroo Island, was awarded the contract in 2017 through a closed tender process.

In February, Paladin’s Manus Island staff walked off the job claiming they had been underpaid and overworked.

The company has rejected suggestions of misconduct or corruption over the contract.

The audit is expected to be tabled in parliament in January 2020.

-with AAP