THE YEAR IN REVIEW

 

 

 

 

Overview

The terrorist bombings which occurred in Madrid in March 2004 and London in July 2005, provided tragic bookends to another demanding year for the Australian Intelligence Community, and for the Office of the Inspector-General of Intelligence and Security (OIGIS).

The 2004–05 reporting period encompassed the direct attack of Australian interests abroad (ie. the Australian Embassy bombing in Jakarta in September 2004), direct Australian military involvement in hostile operating environments (principally in Iraq but also Afghanistan and elsewhere), as well as serious threats to the interests of Australians at home and abroad.

Significantly increased resources as well as a range of new powers have been provided to AIC agencies since the terrorist attacks on the United States on 11 September 2001 starkly highlighted the need for good quality and timely intelligence if similar attacks on Australians and Australian national interests are to be averted. In the period since 2001, the AIC and various other government agencies have devoted considerable effort to identifying and where possible, countering, the terrorist threat which has emerged in recent years.

I must also note that there is a vital public interest in ensuring that any new measures to protect national security which have been implemented, or are presently being contemplated, should not be unduly corrosive of the values, individual liberties and mores on which our society is based.

It is against the backdrop of such a global security environment that I report on the activities of the IGIS for the reporting year 1 July 2004 to 30 June 2005 (hereafter referred to simply as 2004–05).

AIC Related Reviews

Flood Inquiry

As mentioned in last year’s annual report, the government, acting on a recommendation made by the Parliamentary Joint Committee on ASIO, ASIS and DSD (the PJCAAD), initiated an independent inquiry into the performance of the intelligence agencies on 4 March 2004.

The review was conducted by Mr Philip Flood AO, who had previously served as the Australian High Commissioner to the United Kingdom (1998–2000), Secretary of the Department of Foreign Affairs and Trade (1996–98), and as a Director-General of ONA (1995–96).

Without seeking to limit his inquiry, the Prime Minister asked Mr Flood to provide advice on:

Mr Flood provided his report to the government in early July 2004, and a public version of the report was published on 22 July 2004. The Report of the Inquiry into Australian Intelligence Agencies is accessible on the Internet at http://www.dpmc.gov.au/publications/intelligence_inquiry.

Mr Flood made 23 recommendations, all of which were accepted by the government with the exception of a proposal for ONA to be renamed as the Australian Foreign Intelligence Assessments Agency.

Among the more significant of the recommendations made by Mr Flood were:

As one of Mr Flood’s key terms of reference was to inquire into and report on “the effectiveness of the intelligence community’s current oversight and accountability mechanisms”, I naturally met with Mr Flood several times to offer my perspectives. My staff and I liaised frequently with the secretariat which supported Mr Flood during his review.

Mr Flood offered the following thoughts in his final report on extant accountability arrangements in the AIC and on the role of my office:

“Our liberal, democratic society demands that all elements of government are accountable. Australians are entitled to be confident that government institutions are operating according to law, under the authority of ministers, and that they offer value for money, efficiency and effectiveness.

Intelligence agencies are no exception. Indeed, these obligations are, if anything, higher in relation to intelligence agencies than other branches of government. With the capacity to infringe on citizen’s privacy and to undertake acts that without specific legislation might be unlawful, Australians are entitled to expect that intelligence collection agencies are properly scrutinised and held to account.”1

“Overall, the accountability arrangements in the Australian intelligence community are working effectively. The National Security Committee of Cabinet is vigorous and engaged. The Intelligence Services Act has worked well in practice. The Parliamentary Joint Committee (by reviewing administration and expenditure) and the Inspector-General of Intelligence and Security (by reviewing operations and activities) provides complementary forms of scrutiny.”2

“The Inquiry found that the Inspector-General of Intelligence and Security performs an important function in the system of accountability of the agencies. Most valuable among the roles of the Inspector General is the power to investigate deeply into the conduct of the agencies. The penetrating character of those powers is a strong feature of Australia’s accountability systems.”3

Not with standing this positive assessment about the suite of accountability mechanisms which oversight and guide the activities of the AIC, Mr Flood also identified several apparent gaps or deficiencies. Some of these gaps related to the mandate of this office. In order to plug those perceived accountability gaps, Mr Flood made several recommendations in respect of the role and functions of the IGIS, as follows:

“Recommendation 2—… the Inspector-General of Intelligence and Security Act 1986 should be amended to include scrutiny of DIGO on a basis comparable with that which applies to DSD and ASIS.

Recommendation 3—The mandate of the Inspector-General of Intelligence and Security should be extended to allow IGIS to initiate inquiries at his or her own discretion into matters relating to ONA and DIO without ministerial referral, consistent with the IGIS jurisdiction in respect of ASIO, ASIS and DSD. The Inspector-General should also conduct a periodic review of ONA’s statutory independence.”4

The various government endorsed recommendations made by Mr Flood required significant planning and coordination to put into effect. To this end DPMC created an Inter-Departmental Committee (IDC) and several subsidiary working groups to facilitate the implementation of the agreed recommendations.

This office was an active and engaged member of the IDC and the IDC’s Accountability Working Group while these bodies were active (ie. throughout the first half of the reporting period). Details of proposed legislative changes flowing from Mr Flood’s recommendations are detailed in the section of this chapter which deals with ‘Legislation’.

PJCAAD—Review of ASIO questioning and detention warrants

The Commonwealth Parliament passed the Australian Security Intelligence Organisation Legislation Amendment (Terrorism) Act 2003 on 26 June 2003, and it received assent on 22 July 2003.

The effect of this Act was to insert a new Division into Part III of the Australian Security Intelligence Organisation Act 1979 (the ASIO Act), permitting the Director-General of Security, with the Attorney-General’s consent, to seek a warrant authorising the questioning or detention of a person where doing so would substantially assist the collection of intelligence in relation to a terrorism offence.

Recognising that the extension of these extraordinary new powers to ASIO was likely to remain a subject of public concern and ongoing debate, parliament inserted a three year sunset clause on the operation of these new provisions (via s.34Y of the ASIO Act), meaning these provisions will cease to have effect on 23 July 2006 unless renewed.

The execution of the first questioning warrants granted under section 34D of the ASIO Act occurred in the later part of 2003.

Practical experience derived from seeking and then executing these warrants, led the government to propose a number of modifications to the new provisions.

The modifications proposed by the government were contained in the ASIO Legislation Amendment Act 2003, which was assented to on 17 December 2003. This Act also effected several consequential amendments to the ISA, including amending the functions of the PJCAAD to require it to review, by 22 January 2006, the operation, effectiveness and implications of the new Division 3 of Part III of the ASIO Act, and to report the Committee’s comments and recommendations to each House of the Parliament and to the responsible Minister.5

I lodged a written submission with the PJCAAD on 30 March 2005. The submission provided an overview of the role of the IGIS in respect of these new powers, various observations on how Division 3 of Part III of the ASIO Act has operated in practice, and a series of proposals for further possible legislative refinements. A copy of the submission can be found at Annex 2 to this annual report.

The Committee conducted a series of public hearings in Canberra, Sydney and Melbourne, in May–June 2005. I appeared before the Committee in Canberra, on 20 May 2005. In my submission and in my oral evidence to the Committee, I supported the continuation of these powers in the short and perhaps medium term, but also the maintenance of a sunset clause.

The PJCAAD’s review of ASIO’s questioning and detention powers was still in train at the conclusion of the reporting period.

PJCAAD—Review of ISLA Bill 2005

The Intelligence Services Legislation Amendment Bill 2005 (ISLA Bill) was introduced into parliament on 16 June 2005. The Senate resolved the same day to refer the Bill to the PJCAAD for comment and to provide a report to the Minister for Defence (the sponsor of the Bill).

I and other affected AIC agency heads met with the PJCAAD, also on 16 June 2005, to provide a brief overview of the ISLA Bill and explain its likely impact on each of our agencies. A fuller explanation of the background to the ISLA Bill is provided under the ‘Legislation’ section of this chapter.

The PJCAAD review of the ISLA Bill 2005 was on-going at the conclusion of the reporting period.

Blunn Review of the TI Act 1979

On 18 March 2005, the Attorney-General, the Hon. Philip Ruddock MP, announced that he had asked a former Secretary of the Attorney-General’s Department, Mr AS Blunn AO, to conduct a review of the regulation of access to communications under the Telecommunications (Interception) Act 1979 (the TI Act).

The Blunn Review is intended to have particular regard to:

As recognised in the terms of reference for this review, any proposals to amend the TI Act are likely to have a significant impact upon the activities of many of the agencies for which the Inspector-General has oversight responsibilities. I met with Mr Blunn on 1 April 2005, and provided the perspective of this office on the matters he is reviewing.

The Blunn Review remained on-going at the completion of the reporting period.

Legislation

Intelligence Services Act

The ISA was passed by parliament in late September 2001, assented to on 1 October 2001, and came into effect on 29 October 2001.

Despite the apparent coincidence in timing, the ISA was not formulated in response to the 11 September 2001 terrorist attacks on the United States, but had been introduced into parliament several months previously, following recommendations contained in a Commission of Inquiry into ASIS6 and significant policy development and consultation.

The immediate practical effect of the ISA was to:

While generally satisfied that the ISA was achieving the objectives set for it, my predecessor as Inspector-General, Mr Bill Blick PSM, identified several issues, of a predominantly technical nature, which he believed should be addressed whenever the ISA was next to be amended.

Mr Blick formally pursued this matter with Dr Peter Shergold (the Secretary of DPMC) before his retirement in March 2004. Dr Shergold, wrote to me shortly after I took up my appointment agreeing that such a review would be valuable.

This review, which was administrative in character, was conducted by officers of DPMC between October 2004 and March 2005. My office contributed significantly to this review, liaising frequently with the DPMC reviewers on the one hand, and acting as a sounding board for the AIC agencies on the other.

The ultimate result of this review activity was to complement changes flowing from the Flood review, and both sets of changes are included in the ISLA Bill.

IGIS Act

There were no amendments to the Inspector-General of Intelligence and Security Act 1986 (IGIS Act) during the reporting period. However, as indicated elsewhere in this chapter, Mr Flood made several recommendations in his report which will require changes to the IGIS Act.

I took the opportunity presented by the ISA review to propose a number of essentially minor, technical amendments to the IGIS Act.The vehicle for these amendments is also the ISLA Bill.

The amendments which I have proposed to the IGIS Act, separate from Mr Flood’s recommendations, include the insertion of provisions which would provide me with a guaranteed right of access to any place where the subject of a detention warrant issued under section 34D of the ASIO Act, is being detained. This change is necessary because the extant legislation only provides the IGIS with a right of access to premises occupied by an AIC agency. If the detention provisions of the ASIO Act were to be invoked, it is likely that the detention would occur at premises other than those occupied by an AIC agency (eg. a gaol or watch-house, or similar such facility).

A minor amendment to section 16 of the IGIS Act has been proposed to provide a clear basis for me to consult with the Commonwealth Ombudsman prior to commencing an inquiry in relation to an AIC agency. This is with a view to avoiding duplication in inquiries and clarifying jurisdiction where necessary.

I have proposed amendments to sections 15 and 21 of the IGIS Act to establish alternative mechanisms for providing advice of an inquiry, and for providing copies of draft reports relating to inquiries, where the inquiry relates directly to the head of an agency in a personal capacity. The desirability for an amendment of this kind was highlighted by a recent inquiry conducted by this office, in which an agency head was a key figure, rather than being a participant simply by virtue of his office.

The proposed amendments would allow the Secretary of the Department of Defence to serve as the principal point of contact for IGIS inquiries should any future cases arise where the head of any of the Defence members of the AIC (ie. DSD, DIGO and DIO) is personally involved, and the responsible Minister in the case of any of the other members of the AIC.

Training

I have actively sought to make presentations at suitable agency training courses and seminars as often as possible. In 2004–2005 I or a senior member of staff presented to approximately 700 staff in the six agencies.

The presentations are tailored to the particular agency or audience, but all cover the history and activities of this office, the importance of the rule of law and agencies acting in accordance with the law, and the need for accountability and community confidence in their use of special powers and capabilities.

Inspections, Complaints and Inquiries

Inspections

As in previous years, inspection of the activities of the intelligence collection agencies (namely ASIO, ASIS, DSD and DIGO) has occupied a significant proportion of the resources of the office.

My office visits each of these agencies regularly to inspect operational records, to check that their activities are conducted with propriety and comply with the law. Details of the specific inspection activities are set out in the chapters of this report that deal with each respective agency.

Complaints

During 2004–05 this office received 33 new complaints leading to preliminary or full inquiries (23 in 2003–04) and 45 new complaints which specifically nominated an AIC agency that were handled administratively (35 in 2003–04).

Although these raw figures might suggest an increase in public dissatisfaction with the agencies, the increase is attributable to an upsurge in immigration related complaints directed against ASIO.

During the reporting period I pursued 14 preliminary inquiries into complaints about alleged delays on the part of ASIO in conducting immigration related security assessments, and 17 similar complaints were handled administratively. The treatment of these complaints is explained below, and in the chapter of this report dealing with ASIO.

The underlying level of complaint about AIC agencies prior to the terrorist attacks of 11 September 2001 was quite low. There was an upsurge shortly thereafter and in the wake of the Bali bombings in October 2002, driven by an increase in overt operational activity on the part of ASIO (eg the execution of a number of entry and search warrants). In more recent times the level of complaints has essentially stabilised (or, if the immigration related complaints are removed, slightly declined) but can be anticipated to fluctuate depending on the level of operational activity.

Immigration related complaints

In previous years, this office has received occasional complaints about the timeliness or manner in which ASIO conducts security assessments of individuals seeking protection visas, or permanent residency in Australia. In 2003–04 two such complaints were received which led to preliminary inquiries.

As noted in the preceding section, in 2004–05 there was a marked increase in the level of immigration related complaints to this office concerning timeliness. I initiated a number of preliminary inquiries into such cases.

Upon investigation my office learnt that the workload had increased significantly and that systems employed by ASIO for processing these applications were under significant strain as important resources were reallocated to high priority tasks. Delays were also caused due to issues about the transfer of data between agencies.

Significant resources were allocated in the most recent Federal budget to address various processing and information technology issues associated with this subject. The government also made an important announcement in June 2005 that included a commitment to timelier processing by the Department of Immigration, Multiculturalism and Indigenous Affairs and by ASIO.

I am hopeful that this injection of funding and the commitment of the responsible agency heads, will address those concerns which gave rise to an upsurge of complaints to my office.

As at the end of the reporting period, there was still a steady stream of immigration related complaints. The practice now is to handle these complaints administratively (eg my office ascertains when the request for a security assessment was levied, where in the queue the application sits, and if there are any unusual features or complexities which would justify a deeper level of inquiry). I will now only proceed to a preliminary or full inquiry in unusual circumstances.

Search warrants

As has been widely reported in the media, and subsequently confirmed by the Attorney-General, ASIO executed a number of entry and search warrants against persons of interest, in June 2005.

It has also been publicly reported that my office has received complaints relating to the execution of these warrants. These complaints are concerned with whether there was a proper basis for granting the warrants, and allegations that sensitive information was released to the media without proper authorisation, with a view to prejudicing the interests of the subjects of the warrants. My inquiries into these complaints were ongoing as at the end of the reporting period.

Although not strictly falling within the reporting period, I can advise that my office was also contacted in July 2005 by several individuals who had goods seized during the execution of these warrants. In each instance the individuals concerned wished to have the return of those goods expedited.

The terms of the relevant warrants require the return of seized goods within a reasonable time frame. My office has been closely monitoring progress on the return of these goods, to ensure that the terms of the warrants are complied with. These contacts have been handled administratively rather than as inquiries.

Recruitment/employment concerns

The number of staff employed by the AIC has risen substantially in the last few years. As a consequence, the AIC agencies have been undertaking large-scale recruitment campaigns.

While grievances of staff members within agencies are generally outside my jurisdiction, we received several complaints about recruitment practices and background security checking during 2004–05 which did fall within the jurisdiction of this office. These complaints were, in a relative sense, few in number and were spread evenly across the agencies.

Defence Force complainant

As was reported in our last annual report, a serving member of the ADF, Lieutenant Colonel Lance Collins, wrote to the Prime Minister in March 2004, with a series of grievances which were subsequently made public.

In his letter to the Prime Minister, Lt Col Collins was critical of an inquiry conducted by my predecessor as IGIS, Mr Bill Blick PSM, which was finalised in May 2003.

I was appointed Inspector-General in late March 2004. Shortly after my appointment, the then Chief of the Defence Force, General Peter Cosgrove AC MC, referred various papers for my independent consideration. I reviewed these papers as well as Mr Blick’s report administratively, rather than in the guise of a formal IGIS Act inquiry.

On 3 May 2004, I wrote a letter to Senator the Hon Robert Hill, Minister for Defence (copied to General Cosgrove) offering my views on the papers I had reviewed. I concurred with the majority of findings made by Mr Blick in his May 2003 report but suggested that one line of investigation whilst comprehensive, was not exhaustive. That being so, I suggested that this issue could be pursued by me, as a formal IGIS inquiry.

Senator Hill formally requested me to inquire into this matter, in accordance with section 8(3)(a)(ii) of the IGIS Act, on 6 May 2004.

I provided the report of this inquiry to Senator Hill on 30 November 2004. In my report I suggested that Senator Hill seek further advice from the Secretary of the Department of Defence in respect of certain issues.

Senator Hill issued a press release on 9 December 2004 in which he indicated that he had sought advice from the Secretary to the Department of Defence, on matters raised in my report, and that the Secretary was pursuing legal and administrative issues arising from the report. Senator Hill attached a copy of my letter to him of 3 May 2004 to the press release. This letter is reproduced as Annex 3 to this report.

Senator Hill released an abridged version of my inquiry report publicly on 25 August 2005. This is reproduced as Annex 4.

Footnotes
1 P Flood, Report of the Inquiry into Australian Intelligence Agencies, Canberra, July 2004 p.51 (cited hereafter as 'Flood').
2 Flood, p.57.
3 Flood, p.59.
4 Flood, p.180.
5 Section29(1)(bb)(i)(ii) and (c) of the Intelligence Services Act 2001 refers.
6 GJ Samuels and MH Codd, Commission of Inquiry into the Australian Secret Intelligence Service, 1994-1995.

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