The Children's Society has described the bill, which was introduced into parliament this week, as a "missed opportunity".
The charity's policy advisor Lisa Nandy said: "It looks as if there is no change of policy regarding the detention of asylum-seeking children and we will continue to seek an end to this practice."
Another concern surrounds a requirement in the bill for those seeking citizenship and asylum to speak English.
Nandy said: "This is to be welcomed in principle but sadly in practice there is little support for those wanting to speak English. There is little free entitlement for many going through the system and it is the children that end up suffering."
Because children have access to language lessons at school they end up as de facto translators for their parents, "in a number of highly inappropriate situations," she said. These include during medical check ups and legal meetings.
Despite her concerns Nandy does welcome a clause in the bill that the UK Border Agency and private contractors involved in immigration services must ensure children's welfare is promoted and their safety is a priority. This brings such services in line with section 11 of the Children's Act (2004) for the first time.
The Children's Commissioner for England, Sir Al Aynsley-Green, also welcomed the clause. He said: "This development has the potential to give children from overseas who are seeking asylum an equivalent level of protection enjoyed by UK-citizen children."
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