11/09/2015 1:09 PM AEST | Updated 15/07/2016 12:51 PM AEST

Peter Dutton Caught Joking About Pacific Islands' Rising Sea Levels

CANBERRA -- Prime Minister Tony Abbott and Immigration Minister Peter Dutton have been caught on camera in what has been described as a "huge diplomatic blunder", laughing over rising sea levels and tardiness in Indigenous communities.

The pair, with Social Services Minister Scott Morrison, were chatting in front of the media in Parliament House, while waiting for a community meeting on Syrian refugees to convene.

As it was running late, Dutton noted the meeting was running to “Cape York time”, a reference to the Prime Minister’s recent trip to the Torres Strait and remote northern Queensland.

Abbott replied "we had a bit of that up in Port Moresby".

Dutton raised laughs by adding "time doesn't mean anything when you're about to have water lapping at your door”.

Abbott has just returned from Papua New Guinea’s capital, where the Pacific Island Leaders Forum debated the regional effects and action on climate change.

Pacific Island nations are concerned about rising seas levels and have pleaded with Australia to help them.

He refused to give ground and go further than Australia’s existing greenhouse gas reduction commitment, describing the 26-28 percent reduction target on 2005 levels by 2030 as “ambitious”.

Asked later what he meant by the water lapping quip, Dutton said it was a "private conversation with the Prime Minister and I don't have anything to say further to that”.

Late in the exchange, Morrison drew his colleagues' attention to the large television microphone hovering over their heads.

“There is a boom up there,” he noted.

Greens deputy leader Larissa Waters says the exchange between the men was “breathtaking”.

“It’s a huge diplomatic blunder that will enrage our Pacific Island neighbours, who have been calling on Australia to save their homes," she said.

“What an insult for them to now hear the Australian Prime Minister laughing at the prospect of their homes going underwater.”

The Prime Minister’s Office has been sought for comment.