Ministers say they are on track to meet their targets
Ministers have denied claims that an "effective amnesty" is in place for asylum seekers as it emerged 40% of a backlog of cases had been approved.
The Home Office says it is on track to clear by 2011 the 450,000 outstanding cases discovered in 2006 and says every case was being judged on its merits.
The department says it has now looked at 130,000 "legacy" cases with 40% of them given leave to stay in the UK.
The Tories said Labour was "no closer" to getting a grip on the issue.
The revelation in 2006 that there were 450,000 outstanding asylum cases which had not been dealt with embarrassed ministers and led to a major shake-up within the Home Office.
At the time, Home Secretary John Reid said it would be possible to clear the backlog by 2011 by reducing the amount of time it took to process cases while cutting the number of new applications.
In an update to MPs, the UK Border Agency said 130,000 of these cases had now been dealt with.
Of these, it said, just over 40% had resulted in people being given permission to stay in the UK. The Home Office could not say how many of the remaining 60% of cases had resulted in removal.
A spokesman said this was because the 60% included cases where records were found to be inaccurate or where applicants had either since died or left the UK voluntarily.
The Home Office also said it could not break down the reasons for applications being approved - but they include the danger to individuals of returning home, the length of time they had already spent in the UK, family ties in the UK or the fact some files may have been lost.
The 40% approvals figure also included cases relating to countries that had since joined the EU the spokesman added.
A spokesman said the applications system was working more effectively and was "on track" to deal with all 450,000 cases by 2011.
"We have ramped up performance in dealing with asylum 'legacy' cases and are now resolving several thousand every month with every case being looked at on its own merits," he said.
But opposition parties seized on the 40% approval figure, with the Conservatives saying that it represented an "effective amnesty" for asylum seekers.
"Despite all the spin, it is clear that Labour are no closer to getting a grip on illegal immigration," said Conservative shadow home secretary Dominic Grieve.
The approval figure has risen from 37% a year ago while, if rates were to continue at that level, 180,000 of the original 450,000 cases would result in people remaining in the UK.
However, the Border Agency said this ratio may not necessarily apply in the 320,000 remaining cases.
Immigration minister Phil Woolas has said the asylum applications process needs to be further speeded up to reduce uncertainty and distress for applicants.
However, he has attracted controversy over comments about immigration levels and remarks seeming to question the number of legitimate asylum seekers as opposed to economic migrants.