It was a Saturday night community event and could have been in any small Australian town. A fund-raiser was being held for the Thai floods victims and proceedings began with local boys and girls playing short classical pieces on an electric piano. The room was colourful with red tablecloths and a predominantly Chinese, Thai and Malay audience, with a smattering of white Anglos.

This was Christmas Island in November and I was there to visit the large detention centre run by British multinational Serco and the Immigration Department. With a population of about 1500, situated three-and-a-half hours from Perth and serviced by only one airline, Virgin, as an Australian satellite, the island should be a tourist Mecca. Warm weather, Buddhist temples on the coast, palm trees, beautiful vistas across the Indian Ocean, lush rainforests, coconuts falling from trees and unique birds all contribute to a tropical oasis.

But these facts ignore what the Australian government has created out of sight and out of mind. “Everybody thinks of us as a prison island,” a United Christmas Island Workers union member told me. “I travel to Australia or Asia and that’s all they say.”

Gordon Thomson, head of the United Christmas Island Workers union — currently leading a fight against CI’s phosphate mine owners over higher wage demands — said: “We shouldn’t lock people up; it’s like a prison here.”

Christmas Island is full of contradictions. One night I attended, with hundreds of others, an annual event at a Buddhist temple. Two shamans were flown in from Malaysia to bless the community. One, with detailed tattoos on his back and arms, sucked two dummies for five hours while handing out sweets to children. He and his colleague were apparently in a trance and kept the crowd transfixed while the Malay community provided massive helpings of rice, meat, water and beer for the assembled crowd. Large, colourful incense rockets lit the night sky with wisps of jumping fire.

During the evening, I spoke to a young teacher who worked with small children in detention on the island. He had arrived with high hopes of being able to change the system from within. He said Serco staff were friendly enough but told a revealing anecdote. His school had put together an induction manual and gave it to Serco to examine. The response was that some Serco staff were unable to complete the task because they couldn’t read or write.

The island’s biggest employer is now Serco, with most of the workers housed in ’70s style, low-rise apartment blocks. The island’s infrastructure, despite periodic Australian government funding, is lacking, and resentment towards Canberra was palpable. As more boats arrive — I saw two carrying 100 asylum seekers come into shallow waters — many residents told me they couldn’t understand why asylum seekers were being so well housed while they still waited on better and more affordable housing and job opportunities.

The Labor government’s island administrator, Brian Lacy, said he regularly asked Canberra for more resources and had hired a consultant to assist designing a tourist campaign to reframe the island as more than just a prison.

The detention centre is situated on the far side of the island, a long way from any habitation; my visits there required navigating around various road closures due to the current crab migration. During the March riots, footage of a burning detention centre shocked Australia and the world. Viewing that vantage point requires a short hike up a hill. Road access is now blocked, I was told, to deny media easy accessibility.

The vista was expansive and revealing. The amount of resources required to maintain such a centre — when prices on the island for even the most basic products grow exponentially — is extraordinary. Currently holding about 700 asylum seekers, from a peak of more than 3000 earlier this year, an Immigration Department spokeswoman told me the instruction from Canberra was now to maintain relatively low numbers to avoid over-crowding and rising tensions. Nobody sleeps in tents at the centre any more, a common occurrence in the past.

The feeling of isolation, similar to the Curtin detention centre, is key to the soaring mental health problems of staff and detainees. Sister Joan Kelleher, who lives on the island and daily visits detainees, told me she was against mandatory detention because she saw the effects it was having on the men she was seeing.

On the day that I encountered Sister Kelleher on the foreshore, she was accompanied by four Afghan Hazara men, ranging in age from 30s to 40s, who were allowed a few hours with the woman, wading in the ocean and cooking a barbecue of sausages, onions and bread rolls. They had all been in detention, in Darwin and on Christmas Island, for more than 20 months and were awaiting judicial reviews of their claims. They were all on anti-depressant medication and keen to tell me their stories about repression in the Pakistani town of Quetta, where their wives and children still lived in constant danger.

The following day, a few hours before I left, I was finally granted access inside the detention centre to see one Hazara Afghan (after initially being rejected by bureaucrats on the mainland and negotiating with the facility’s departmental manager). I was introduced to the head case manager, Sally, after being ushered through what she acknowledged was “a maximum security prison”. She later added: “If it was built more recently it would be different, softer, less like a jail.”

After passing through heavy security doors, we arrived in a compound of clinical meeting rooms. Sally said Mohammed (not his real name) would arrive shortly. In the meantime she said she was happy to answer any of my questions (by this stage I knew I was getting red-carpet treatment, if such a thing was possible.)

I asked if she believed privatised detention, companies designed to make a profit from asylum seekers, was preferable. Although Sally said there were problems, she said Serco was an essential partner because the public service simply wasn’t capable of handling security, “intel gathering” and other services unless “we hire many more people”.

It reflected something I saw in other centres across the country, the symbiotic relationship between DIAC and Serco: they can’t live without the other and support each other’s secretive culture.

Mohammed arrived and through a Farsi translator — who told me he was from Afghanistan and came by boat in 1999 — explained that he was very depressed after 22 months in detention. He barely made eye contact and looked down at his hands during our time together. He couldn’t go back to Pakistan for safety reasons but he said DIAC never gave any concrete details about his upcoming judicial review. He took six different anti-depressants daily.

*Antony Loewenstein is an independent journalist currently working on a book about disaster capitalism