The center on Manus Island was ruled "unconstitutional" by a court in PNG a year ago.
"We thank New Zealand for making an offer, we are not taking it up at this time".
Campaigners say the government in Canberra is "treating the men like animals" and are demanding they be allowed to resettle in Australia.
Australia turned down on Sunday an offer to take 150 asylum seekers being held in an Australian-run detention center in Papua New Guinea, where United Nations officials have warned a humanitarian emergency is unfolding. Fear of attack from local communities also prevents refugees from leaving the camp. More than 1,000 people protested in Australia yesterday against the treatment of hundreds of asylum seekers in an offshore detention centre that the United Nations has described as an "unfolding humanitarian emergency".
A refugee advocate holds a placard as she participates in a protest in central Sydney, against the treatment of asylum seekers in detention centres located in Nauru and on Manus Island, on October 15. They include Rohingya Muslims from Myanmar, Afghans, Iranians, Sri Lankans and other nationalities, and are nearly entirely men.
There's no food, water, power and limited access to healthcare.
Ardern acknowledged the two Tasman neighbors faced different immigration problems but said the offer remained open.
"We have serious concerns about the welfare, safety and well-being of the roughly 600 men who remain in the accommodation compound, who are too frightened to leave", Colville said. "They are starving and their bodies are getting weak".
New Zealand citizens are typically allowed to work and live in Australia, a pathway that Australia fears could be used by the refugees to move to Australia.
Adding to the drama, right-wing former Liberal immigration minister Kevin Andrews called on his own side of politics to consider New Zealand's offer. "We need your help".
New Zealand Prime Minister Jacinda Ardern said on Friday her country was willing to take 150 asylum seekers from among those held on Manus island and another camp on the tiny Pacific nation of Nauru. The leaders meet in Sydney Sunday.
For four years, Australia has paid Papua New Guinea, its nearest neighbor, and Nauru to house asylum seekers who attempt to reach the Australian coast by boat.
In his retirement, the Grand Chief says he is at liberty today to speak about the miserable manner in which Australia is trying to offload the Manus Island Refugees.