The Fraser cabinet was also told many of the refugees were unskilled, illiterate and had questionable character and standards of personal hygiene.
Cabinet documents released today by the National Archives under the 30-year rule reveal how Australia's decision to accept thousands of Lebanese Muslims fleeing Lebanon's 1976 civil war led to a temporary collapse of normal eligibility standards.
The emergence of the documents raises the question of whether the temporary relaxation might have contributed to contemporary racial tensions in Sydney's southwest, which exploded a year ago into race-based riots in Cronulla.
Former prime minister Malcolm Fraser rejected yesterday any link and said modern Muslim youth felt alienated because governments had not done enough to help them integrate into the general community.
But demographer Bob Birrell said the relatively depressed nature of Sydney's Muslim community could easily be linked to the lack of education and work skills of the 1970s migrants.
John Howard was accused of inflaming public hatred towards the Islamic community last February when he warned that aspects of Muslim culture posed an unprecedented challenge for Australia's immigration program.
The Prime Minister said while he remained confident the overwhelming majority of Muslims would be successfully integrated, there were unique problems that previous intakes of migrants from Europe and Asia did not have.
"I do think there is this particular complication because there is a fragment which is utterly antagonistic to our kind of society, and that is a difficulty," he told The Australian then.
"You can't find any equivalent in Italian, Greek, or Lebanese, or Chinese or Baltic immigration to Australia. There is no equivalent of raving on about jihad, but that is the major problem.
"I think some of the associated attitudes towards women (are also) a problem."
In September 1976, as a humanitarian response to the civil war raging at the time between Lebanese Christians and Muslims, cabinet agreed to relax rules requiring immigrants to be healthy, of good character and to have a work qualification.
Australia accepted 4000 Lebanese immigrants in 1976.
Mr Fraser told The Australian that cabinet had relaxed entry qualifications as a humanitarian response to the Lebanese civil war in line with Australia's international responsibilities.
He said it would be wrong to assert that current tensions in the Muslim community came about because his government had allowed "bad people" to enter the country.
Current racial tensions related to people born in Australia - not the immigrant refugees, he said.
Immigration minister Michael MacKellar told colleagues in 1976 officials had cited concerns about health and character requirements, personal qualities and the migrants' ability to integrate.
Whereas earlier Lebanese intakes had involved an even split of Christians and Muslims, the submission said 90 per cent of the migrants were Muslims and that a high percentage were illiterate and unskilled.
The officials had warned that many refugees were misrepresenting their background during interviews in "deliberate attempts to conceal vital information", Mr MacKellar reported.
And he said most of the applicants were being sponsored by relatives living in Sydney's southwest, where overcrowding was emerging along with evidence that husbands were leaving wives and children "without adequate support" to travel to Lebanon seeking displaced
relatives.
Dr Birrell, who heads Monash University's Centre for Population and Urban Research, said a study last year had shown Lebanese Muslims in southwest Sydney were less well-off economically than Lebanese Christians.
Dr Birrell said this reflected the lack of work skills and education of many of the refugees who arrived in the 1970s.
