Parliament and legislation

Overview

The level of public and parliamentary interest in matters pertaining to intelligence and security and the rate of associated legislative development has risen dramatically in the period since the 11 September 2001 terrorist attacks on the United States.

In keeping with this trend, this reporting period saw high levels of public and parliamentary scrutiny of the activities of the AIC, the development, passage and implementation of various laws which extend the powers of the AIC agencies (and therefore have an impact upon this office), and a series of formal reviews being conducted which will also be influential in shaping the future legislative framework in which the AIC operates.

The following chapter briefly sets out my interactions with parliamentary bodies during the reporting period, summarises legislative developments affecting the AIC in which I have an interest, and briefly details input I have made to several legislative reviews.

Parliamentary oversight

PJCIS

The Chair of the PJCIS for the duration of the reporting period was the Hon David Jull MP, while the position of Deputy Chair was filled by Mr Anthony Byrne MP.

Mr Jull has announced that it is his intention not to contest his seat in the forthcoming Federal election, meaning that a new person will fill this position when the new Parliament is convened. Mr Jull has consistently shown a thoughtful and considered approach to the leadership of the PJCIS during his tenure as Chair of the committee, and I must thank him for the courtesy which he has always shown to this office in our appearances before the PJCIS.

During this reporting period I appeared before or met with the PJCIS on four occasions, as follows:

My staff and I also met with members of the Secretariat which supports the PJCIS on two occasions during the reporting period, to discuss matters of mutual interest.

Senate Finance and Public Administration Committee

I prepared for and was available to appear before the Senate Finance and Public Administration committee during its consideration of Supplementary Budget Estimates in October 2006, Additional Estimates in February 2007, and Budget Estimates in May 2007, but was not called upon on any of these occasions.

Legislative developments

AML/CTF Act 2006

The Anti-Money Laundering and Counter-Terrorism Financing Bill 2006 was introduced to Parliament on 1 November 2006 with the purpose of:

After a period of debate the above Bill was passed by both houses of Parliament and came into force on 12 December 2006, as the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act).

The AML/CTF Act imposes new obligations on reporting entities in respect of identification, verification and ongoing monitoring of customers, reporting suspicious matters and financial transactions above a set threshold, ensuring customer information accompanies international funds transfer instructions, and record keeping obligations.

These requirements will be progressively phased in over a two year period, so as to allow affected businesses sufficient time to implement necessary compliance and reporting measures.

In addition to putting in place a legislative framework to give effect to these objectives, the AML/CTF Act also formally recognised a range of government bodies as being ‘designated agencies’ with strictly limited and controlled access to data which is gathered by the Australian Transaction Reports and Analysis Centre (AUSTRAC).

AUSTRAC is Australia’s AML/CTF regulator and financial intelligence unit and by virtue of the function it performs is a pivotal player in identifying and suppressing the financing of terrorism.

While AUSTRAC is not a member of the AIC per se it has developed linkages with some elements of the AIC, most notably ASIO, given their common interest in identifying and suppressing terrorist related financing.

The fact that AUSTRAC has a relationship with ASIO is a matter of public record and the exchange of information between the two bodies is regulated by a long-standing MOU. ASIO’s compliance with the requirements of its MOU with AUSTRAC is monitored by my office.

ASIO and IGIS were each listed as being a ‘designated agency’ in the AML/CTF Act.

AML/CTF Amendment Act 2007

The introduction and passage of the AML/CTF Act was a large undertaking, and not all that was proposed to be done could be achieved by the passage of that Act.

As a consequence, the Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2007, was introduced to Parliament on 15 February 2007, for the purpose of making technical amendments to the AML/CTF Act and six other Acts.

One of the more significant amendments made as a consequence of the AML/CTF Amendment Act 2007 (AML/CTF Amendment Act) being passed was to make ASIS a ‘designated agency’ with access to financial transaction records maintained by AUSTRAC, and to enable ASIS to communicate such information to foreign intelligence agencies where appropriate.

This amendment brought ASIS into line with ASIO which, as described above, has had a long standing formal relationship with AUSTRAC.

As a consequence of the passage of the AML/CTF Act and the AML/CTF Amendment Act, ASIO is presently reviewing the terms of its MOU with AUSTRAC, while ASIS is developing an MOU.

I will review the terms of my existing arrangements with AUSTRAC, and the inspection activities conducted by this office, in the light of these developments.

Inspector-General of Intelligence and Security Act 1986

The AML/CTF Act and the AML/CTF Amendment Act made amendments to section 22 and section 25A of the IGIS Act. These were essentially technical amendments designed to ensure that appropriate reporting of inquiry and inspection activities could be carried out.

I also began discussions with PMC (as the Department of State for the portfolio), about possible further amendments to the IGIS Act.

The amendments I have proposed are intended to plug minor gaps in my jurisdiction, correct minor drafting anomalies, or provide me with additional flexibility in certain circumstances.

The changes I have in mind are technical and minor in nature, do not unduly hinder me in achieving the objectives of my office pending amendment action, and I expect they will go forward in a portfolio bill in due course.

I am also contemplating whether to recommend some other, more substantive amendments to the IGIS Act. These possible amendments, which have been informed by my experiences during my first term as IGIS, require further thought, research and development before they are brought forward for formal policy consideration and approval.

Privacy Legislation Amendment (Emergencies and Disasters) Act 2006

The Privacy Legislation Amendment (Emergencies and Disasters) Bill 2006 was introduced to Parliament on 13 September 2006, passed through both Houses on 28 November 2006 and was assented to on 6 December 2006.

The Act was developed in the wake of the 2004 Boxing Day tsunami disaster, to overcome concerns that a too strict application of the Privacy Act 1988 (the Privacy Act) inhibited the capacity of some agencies to respond quickly and flexibly in the face of a crisis involving mass casualties and missing persons.

The Act provides for the readier flow of personal information by and between government agencies when an emergency declaration has been made by either the Prime Minister or the Attorney-General, by temporarily relaxing statutory confidentiality or secrecy provisions, excepting where a ‘designated secrecy provision’ is binding upon the IGIS and/or the intelligence agencies.

Relevant legislation applying to the IGIS and the intelligence agencies already provides the agency heads with a measure of discretion about the release of information in emergency situations, although this Act made some minor amendments to section 18 of the ASIO Act to ensure the Director-General of Security has similar flexibility.

Crimes Legislation Amendment (National Investigative Powers and Witness Protection) Bill 2006

In addition to being affected by legislation which passes through the Parliament, my office is frequently consulted on, or pays close attention to, draft legislation which may affect the office or the AIC.

One such bill upon which I was consulted as it was being developed was the Crimes Legislation Amendment (National Investigative Powers and Witness Protection) Bill 2006, which was introduced into Parliament on 29 November 2006.

One of the purposes of this Bill is to expand existing national model legislation to protect the identity of covert operatives who give evidence in court, by extending the scheme to include protection for security and intelligence officers and other authorised persons (such as foreign law enforcement officers) granted an assumed identity.

The Bill further proposes that ASIO and ASIS be required to make an annual report to the IGIS, as soon as practicable after the end of each financial year, on the extent to which they have authorised the use of assumed identities and or used witness identity protection certificates, and cognate information relevant to their use.

The requirement to make a report on the use of witness protection certificates is naturally a new requirement, but reflects the existing procedure set out in section 15XUA of the Crimes Act 1914 in relation to assumed identities.

This Bill was still under consideration at the conclusion of the reporting period.

Human Services (Enhanced Service Delivery) Bill 2007

Another bill upon which I have been consulted and in which I have a potential functional interest is the Human Services (Enhanced Service Delivery) Bill 2007.

The genesis of this Bill lies in an announcement made by the Australian Government on 26 April 2006 that it planned to introduce a new access card for use in the administration and payment of various health and social service benefits, that the card would utilise smartcard technology and that the card was expected to replace up to 17 cards that are currently used to access Australian Government health, social service and veteran’s benefits.

The Government introduced a Bill in February 2007 which detailed those matters which needed to be included in the first tranche of legislation to introduce the access card. On 15 March 2007, the Minister for Human Services accepted a recommendation from the Senate Finance and Public Administration Committee to consolidate all proposed tranches of the access card legislation into a single consolidated Bill. In the period since, the Department of Human Services has been working assiduously to develop a successor to the original bill.

My interest in the access card principally lies with what access, if any, agencies such as ASIO or ASIS should have to information which is collected for, or contained on, the proposed access card, and if access is to be provided, how this access is to be regulated and monitored.

Development of a replacement Bill to create the proposed access card was on-going at the completion of this reporting period.

Telecommunications (Interception and Access) Amendment Bill 2007

In my annual report for 2004–05, I provided some basic background information on a review of the then Telecommunications (Interception) Act 1979 (T(I) Act), which was conducted by Mr A S Blunn AO.29

The purpose of the Blunn Review was to examine the adequacy of the regulation of communications which was provided for under the then T(I) Act, balanced against:

The Government responded to Mr Blunn’s recommendations by introducing a first tranche of changes via the Telecommunications (Interception) Legislation Amendment Act 2006, with the intention of introducing a second tranche at a later date.

This first tranche of legislative changes covered such matters as stored communication warrants and B-Party intercepts and were summarised in my previous annual report.30

The Telecommunications (Interception and Access) Amendment Bill 2007 was introduced to Parliament in June 2007, to give legislative effect to those of Mr Blunn’s recommendations which were not dealt with in the earlier legislation.

The Senate referred the provisions of this Bill to the Senate Standing Legal and Constitutional Affairs Committee on 21 June 2007 for inquiry and report by 1 August 2007.

I made a submission to this Committee on 11 July 2007, but as this submission was sent following the conclusion of this reporting period I have not included it in this report, but it is accessible via the Committee website.31

Statement of Procedures – warrants issued under Division 3 of Part III of the ASIO Act 1979

The Australian Security Intelligence Organisation Legislation Amendment (Terrorism) Act 2002 inserted a new Division into Part III of the ASIO Act 1979, which provided for questioning, and questioning and detention warrants.

Several sections of the amending Act required the development of a written statement of procedures (namely a ‘protocol’) to be followed in the exercise of such warrants and provided that no warrant of this kind could be issued until the protocol was tabled in Parliament.

The background to the development of the protocol and a copy of the protocol were included in my first annual report as IGIS.32

Due to a technical oversight this protocol lapsed in September 2006 and had to be remade. The remade protocol is substantially the same as the previous protocol but has been retitled as a “Statement of Procedures” and incorporates clearer headings and a slightly revised internal numbering system (to permit for some introductory remarks about the commencement of the procedures and the revocation of the previous protocol).

The new ‘Statement of Procedures’ was issued by the Attorney-General on 16 October 2006, and has been added to the Federal Register of Legislative Instruments. I have attached a copy of the ‘Statement of Procedures’ as Annex 4 to this report.

Contributions to public sector governance

Membership of the Security Legislation Review Committee

In October 2005 the Attorney-General established the SLRC, under the chairmanship of a retired judge of the NSW Supreme Court, the Hon Simon Sheller AO QC, to review the operation, effectiveness and implications of six pieces of legislation relating to terrorism which were introduced or amended in 2002 and 2003. I was appointed to the SLRC as an ex-officio member.

While the work of the SLRC itself was completed during the previous reporting period, as discussed elsewhere in this chapter I appeared before PJCIS inquiries in July 2006 and April 2007 to discuss the findings of the SLRC.

I continue to closely monitor developments relating to the recommendations of the SLRC and will continue to contribute my thoughts to appropriate forums, on cognate issues, as appropriate.

Membership of the Administrative Review Council

The Attorney-General announced in a media release dated 26 April 2007, that I had been reappointed as a part-time member of the Administrative Review Council (ARC) for a further three years. While the announcement coincided with my reappointment as IGIS, the appointment has been made to me in a personal rather than official capacity.

During the reporting period I participated in a seminar to mark the 30th anniversary of the founding of the ARC, attended four ARC meetings, and participated in two ARC related teleconferences. Although not all matters considered by the ARC relate directly to the AIC, many issues under consideration do, and there are advantages to my role as IGIS from my participation in ARC meetings and functions.

Providing advice on the outcome of complaints investigations

In the early part of 2006 I informally canvassed the views of the Australian Public Service Commissioner, the Privacy Commissioner, and the Commonwealth Ombudsman as to whether a too strict interpretation/ application of the Privacy Act was inhibiting the capacity of various public sector agencies to provide comprehensive advice to complainants about the outcome of investigations into their complaints, especially where the outcome involved disciplinary action being taken against one of the parties.

I had raised this issue in the light of a particular IGIS investigation but as IGIS Act inquiries are not typical of those conducted across the public service (due to the frequent interplay of security as well as privacy issues), thought it best to informally seek the views of experts in this field, as to whether this was an area of actual or potential concern.

These informal soundings led to the creation of a small working group to which my office contributed during this reporting period, which is examining this issue.

ALRC review of the Privacy Act 1988

On 31 January 2006 the Attorney-General provided a reference to the ALRC for an inquiry into the extent to which the Privacy Act and related laws continue to provide an effective framework for the protection of privacy in Australia. This inquiry is being led by ALRC Commissioner, Associate Professor Les McCrimmon.

I met with Professor McCrimmon on 15 March 2007, to discuss a range of privacy related issues pertaining to the AIC, with a focus on how the privacy rules and guidelines which exist in the AIC are interpreted and applied.

The ALRC plans to release a discussion paper on this review in September 2007, with the final report and recommendations due to be delivered to the Attorney-General by 31 March 2008.

ALRC review of Client Legal Privilege and Coercive Investigative Powers

On 29 November 2006, the Attorney-General asked the ALRC to inquire into the application of legal professional privilege to the coercive information gathering powers of a number of specified Commonwealth bodies.

Although the OIGIS was not one of the Commonwealth agencies specified in the terms of reference provided to the ALRC, my office does possess strong coercive powers, and this being so, the President of the ALRC, Professor David Weisbrot AM, invited a submission on this subject from my office.

I provided a submission in response to Professor Weisbrot’s invitation (see Annex 5 of this report) and also visited the ALRC offices in Sydney on 26 June 2006, where I spoke to the contents of my submission.

Footnotes
29 IGIS Annual Report 2004-2005, Canberra, October 2005 p. 5.
30 IGIS Annual Report 2005-2006, Canberra, October 2006 p. 14.
31 The submission is located at the following website (as at 14 August 2007) <http://www.aph.gov.au/senate/committee/legcon_ctte/telecommunications_interception/submissions/sub14.pdf>.
32 IGIS Annual Report 2003-2004, Canberra, October 2004, pp. 5-6, and Annex 2.

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