Lee Anderson has accused the “lunatic” Labour Government of “migration madness” over Britain’s deal to send migrants from the Chagos Islands to a remote island in the South Atlantic.

The Reform UK MP challenged a Foreign Office minister to defend the policy which would see migrants transported from the islands in the Indian Ocean to St Helena to have their asylum applications processed.

Mr Anderson told the Commons: “If illegal migrants arriving in St Helena are granted asylum, does that mean they can then apply to come to the UK? And if so, is that not creating another market for the people smugglers?”

Foreign Office minister Stephen Doughty replied: “No, absolutely not. There is no automatic right for them to travel from St Helena to the UK. St Helena would undertake the processing of any of those cases in a proper way and, of course, anybody who failed to get a positive decision would then be removed.”

He went on to explain that as with any British Overseas Territories, people would be able to apply for British Overseas Territories citizenship, but it is not automatic.

Taking to social media after the exchange in Parliament, Mr Anderson wrote on X: “More Migration Madness. Labour have struck a deal to send illegal migrants from Chagos to St Helena 5,000 miles away to claim asylum.

“Once they’ve been granted asylum they can then apply to come to the UK. The lunatics have taken over the asylum.”

On Monday, MPs called for a cap on the number of migrants who can be sent to St Helena after they arrive on the Chagos Islands.

Conservative MP Sir Julian Lewis argued the Labour Government’s deal with St Helena, a British overseas territory in the South Atlantic Ocean, could become a “pull factor”.

The Government announced its decision to relinquish sovereignty over the Chagos Islands earlier this month.

Despite no migrants arriving on the British Indian Ocean Territory since 2022, Mr Doughty said an “interim contingency solution” had to be found before Mauritius takes control of the territory.

He said: “Once any treaty with Mauritius comes into force, following of course its proper parliamentary scrutiny, Mauritius will be responsible for any migrants that arrive there.

“However, we needed to find an interim contingency solution for the period before that agreement comes into force.

“Given that there is no permanent population, [British Indian Ocean Territory, Biot] has never been an appropriate long-term location for migrants due to the logistical challenges of providing appropriate care in such a remote place without civilian infrastructure.

“On October 15, a new memorandum of understanding was reached with the government of St Helena that any new migrants arriving in the interim period would be transferred to St Helena and the intention is for that agreement to last until the treaty with Mauritius comes into force, recalling that in practice no new migrants have arrived on Diego Garcia since 2022.”

During an urgent question on the agreement, Sir Julian (New Forest East) said: “There is a danger of creating a pull factor, and if that happens and a much larger number arrives than is expected, will he put a cap on the number that can be transferred to St Helena?”

Mr Doughty declined to commit to a cap, saying: “That is exactly why we have concluded the agreement that we have with Mauritius, and this agreement with St Helena.

“Biot is not a suitable place for migrants to be present, there is no permanent population, there is not the suitable facilities, and that’s absolutely why we’re taking the steps to close down that route and ensure that people do not make that dangerous journey.”

Earlier in the session, Shadow Foreign Secretary Andrew Mitchell raised concerns “an influx of migrants could adversely impact what is a very tight-knit local community” in St Helena. He asked: “What is the estimated number of migrants that will be sent to St Helena?

“Bearing in mind that the entire population is less than 5,000, will he be imposing – an admittedly low – but nevertheless, a limit?”

Mr Mitchell added: “We do not oppose the principle of offshoring, but we are perplexed by the Government’s choice of destination, a small British overseas territory, which is thousands of miles from Diego Garcia.

“Not least because a number of asylum seekers who landed on the British Indian Ocean Territory have already been transferred to Rwanda.

“Labour has of course scrapped the Rwanda scheme, so can the minister tell the House whether the Government’s approach has now changed, and does the Government welcome offshoring as a means of injecting deterrence within the complexities of illegal migration?”

Mr Doughty replied: “What we are doing is providing pragmatic and practical solutions to respond to the situation that we inherited. There is no comparison with the Rwanda scheme.”

He added the scheme will cost £6.65million, with additional costs for each migrant.

Conservative former minister Sir Desmond Swayne argued that “the opportunities available to any migrant are vastly greater in Rwanda”.

Mr Doughty replied: “Well, why didn’t they go there? I mean, four people for £700m. This is an absurd comparison to make.”