The year in review

General matters

Although Australia is an island, for practical purposes we live and operate in an increasingly globalised and interconnected world, where distant actions can and do have a direct impact on the way in which we live our lives.

In the period since the 21st century commenced, there has been rising concern about the nuclear and other intentions of certain nation states, the global spread of acts of politically motivated violence by nation states and non-state players, the potential vulnerability of new technologies and critical infrastructure to individuals or groups with hostile intentions, and a developing awareness of the potential for climate change to have an impact on security.

In short the global security environment is not benign to Australia’s enduring national interests, it can and does change rapidly, and it is increasingly complex to navigate.

Key intelligence and security interests

During the period 1 July 2006 to 30 June 2007, the AIC focussed on a wide variety of monitoring, collection and assessment activities. It is impossible in any annual report to list the full range of these activities, both for valid security reasons and because they are too numerous to detail, but these interests included:

Continuing growth of the AIC

Following the 2004 review by Mr Philip Flood AO and other reviews such as that by Mr Allan Taylor AM into ASIO’s resources13, the AIC has expanded considerably.

It is not appropriate to provide specific details of the growth and current size of each agency (as to do so could inadvertently provide details of an agencies capabilities and priorities), but the announcement on 16 October 2005 by the Attorney-General, the Hon. Philip Ruddock MP, that ASIO would grow from 980 positions as at that date, to 1860 positions by 30 June 2011, is one indication which has been put in the public domain.

While each of the AIC agencies has suffered varying degrees of organisational stress associated with rapid growth, from what I have seen the AIC agencies have continued to function at a high level while juggling the competing demands of a complex and dynamic security environment, responding flexibly to new and emerging threats, undergoing significant internal restructuring and accelerating the education and development of new staff.

Consequential growth of OIGIS

When I first commenced as IGIS, the office comprised myself and four staff. This was maintained for approximately 12 months before I obtained funding approval to increase the size of the office, in recognition of the expanded role and functions of the office flowing from changes to the IGIS Act and other intelligence related legislation recommended in the Flood review, and to also match the actual and anticipated growth of the AIC.

The growth of OIGIS over the past two years has been phased, rather than occurring all at once. This has occurred so as to ensure that the changes to the office are digestible, and also due to the length of time it takes for preferred candidates for positions to this office to proceed through the extensive security vetting process.

As at 30 June 2007, OIGIS comprised myself and nine staff, each of whom perform a variety of inspection, inquiry, review, complaints handling and corporate functions. Further details about the composition of the office are provided in the Corporate and Communications chapter of this report.

Summary

It is against the above backdrop of an increasingly complex and dynamic security environment, the rapid growth of the AIC agencies, the extension of new powers to those agencies, and public debate about the potential loss of hard won rights and liberties that I report on the activities of my office for the reporting year 1 July 2006 to 30 June 2007 (hereafter “the reporting period”).

OIGIS – 20th anniversary

OIGIS commenced operations on 1 February 1987 and naturally enough celebrated its 20th anniversary on 1 February 2007.

The inaugural IGIS, Mr Neil McInnes AM, commenced operations in premises located at Macarthur House, Lyneham, ACT, but this arrangement lasted for approximately one year only, following which OIGIS accepted an invitation to lodge with PMC, in its building located at 3–5 National Circuit, Barton, ACT.

In the succeeding years OIGIS has been physically located in the PMC building and made significant use of the corporate facilities provided by our portfolio Department.

Despite our close organisational links and physical proximity to PMC, my predecessors and I have always been very conscious to maintain the separate identity of OIGIS. This is important as the IGIS, like the Commonwealth Ombudsman, is an independent statutory office holder and as the head of a watchdog agency must be prepared to be critical of government agencies when and where appropriate.

The effectiveness and utility of the office would be seriously eroded were it to be considered anything other than genuinely independent.

On 19 February 2007, PMC moved to new premises located at One National Circuit, Barton, ACT (i.e. immediately adjacent to their former offices). OIGIS moved at the same time, to the new PMC building. This was no simple exercise due to the security overhead associated with ensuring that the new premises were wholly secure from day one, but I am pleased to advise that this was achieved with little disruption to our day to day activities.

So as to mark the dual occasion of the 20th anniversary of the creation of the office, and our move to new facilities, I hosted a small function at our new offices on 9 March 2007, to which I invited my four predecessors as IGIS.

A brief pen portrait of each of the previous Inspectors-General is provided on the opposite page.

Mr N D (Neil) McInnes AM
(1 February 1987– 27 September 1989)

The inaugural Inspector-General was selected to establish OIGIS in late 1986, following a lengthy career observing and commenting on international relations and several subsequent senior level appointments within government.

In the course of a lengthy stint as a journalist based in Paris (1955-1978), Mr McInnes wrote four respected books which provided an in depth analysis on the development and theoretical underpinnings of the Communist parties of western Europe.

Following his return to Australia, Mr McInnes filled the position of the Deputy Director-General of ONA (1978–1982), before being promoted as a Division head within the Department of Defence (1982–1983), and then as a Deputy Secretary in PMC (1983–1986). 

Mr J R (Roger) Holdich AM
(28 September 1989 – 5 April 1995)

Like the inaugural IGIS, Mr Holdich was another foreign affairs specialist.  After commencing his career in the South Australian Department of Trade, Mr Holdich gave many years of distinguished service to the Department of Foreign Affairs (1959–1976), during which time he rose to Ambassadorial rank (to the Republic of Korea 1975–1976).

Following his return to Australia, Mr Holdich headed up the International Division of PMC (1976–1983), before appointments at the Deputy Secretary level in the then Departments of Special Minister of State (1983–1987), and Administrative Services (1987–1989).

Mr R N (Ron) McLeod AM
(6 April 1995 – 18 February 1998)

Mr McLeod took up as Inspector-General following a long and distinguished career at the then Public Service Board and the Department of Defence.

In his time at the Public Service Board, Mr McLeod held positions at the Branch and Division head level (1971-1984), before being promoted to become the Deputy Secretary Budget and Management, in the Department of Defence (1984-1995).

In 1994, Mr McLeod was seconded to head a major review of the Public Service Act 1922, and made a series of recommendations which ultimately lead to the Act being wholly revamped in the form of the Public Service Act 1999.

Towards the completion of his first term as Inspector-General, the Government appointed Mr McLeod as the Commonwealth Ombudsman (1998-2003).  

Mr W J (Bill) Blick AM, PSM
(19 February 1998 – 22 March 2004)

Mr Blick commenced as the fourth Inspector-General in February 1998 immediately upon Mr McLeod’s appointment as Commonwealth Ombudsman.

Prior to his appointment, Mr Blick spent the majority of his career at various levels within the Department of the Prime Minister and Cabinet, ultimately heading up that department’s Government Division, before being promoted to the Deputy Secretary level (1996-1998). 

While in the later position, Mr Blick took a leading role in organising the Federal constitutional convention of February 1998 at which delegates were asked whether or not Australia should become a republic, and following a majority vote to this effect, which model for a republic they preferred.

In the midst of his career within PMC, Mr Blick served as the Deputy Commonwealth Ombudsman (1984-1986).

Also present at the 20th anniversary event was Mr Philip Moss, who holds the singular distinction of being the inaugural and thus far only Assistant Inspector-General of Intelligence and Security (1987–1997).

I additionally invited the Commonwealth Ombudsman, Professor John McMillan, in recognition of the close links between our respective agencies and because Professor McMillan holds a standing appointment to serve as the acting IGIS, whenever I am overseas, on extended leave, or otherwise unable to discharge the functions of the office.

I am pleased that this small but distinguished group was able to join with me, current OIGIS staff, and several other friends of the office, to mark 20 years of dedicated service to the principles upon which the office was founded.

Reappointment as IGIS

Mechanics and duration of re-appointment

The arrangements for appointing an individual as IGIS are set out in sections 6 and 26 of the IGIS Act.

Such appointments are made by the Governor-General, on the recommendation of the Prime Minister, following consultation with the Leader of the Opposition in the House of Representatives.

The IGIS may hold office for a period not exceeding five years, as specified in the instrument of appointment, but is eligible for reappointment, excepting that a person is not eligible to hold the office more than twice.

I was first appointed as IGIS for a period of three years, with effect from 23 March 2004. My first term as IGIS, therefore expired at the end of 22 March 2007.

I have provided some brief reflections on my first term elsewhere in this report.

Considerations for filling the position had not been completed by early March 2007, and the Prime Minister issued an instrument (pursuant to section 6A of the IGIS Act), appointing me acting IGIS for the period 23 March to 30 April 2007.

I was subsequently appointed as IGIS on a full time basis for a period of four years, commencing from 27 April 2007.

Instruments appointing Prof John McMillan as acting IGIS

It has been the practice of this office over several years to rely on the good offices of the Commonwealth Ombudsman to act as IGIS, in a personal capacity, to cover situations where the IGIS is on duty overseas, on extended personal leave, or on occasions when the IGIS is otherwise unable to discharge the functions of the office.

This arrangement has developed because the office has not had a need for an Assistant Inspector-General since the departure of Mr Moss in 1997, and there is too big a gap in work classification levels between the IGIS and the next most senior persons in the office (who are at the Executive Level 2 classification).

A standing instrument first appointing Professor McMillan as acting IGIS was issued by the Prime Minister on 8 October 2005.

As mentioned earlier, it was necessary for me to be appointed as acting IGIS between 23 March and 27 April 2007. The instrument appointing me as acting IGIS, voided all other instruments appointing persons to act in the office of IGIS (including the standing instrument appointing Professor McMillan).

Following confirmation of my reappointment in late April 2007, the Prime Minister made a new standing instrument, in accordance with section 6A(1) of the IGIS Act, appointing Professor McMillan to act as IGIS as required. This instrument was signed on 28 May 2007.

AIC leadership changes

New Secretary of the Department of Defence

In a press release dated 2 November 2006, the Prime Minister, the Hon. John Howard MP, advised of the proposed retirement of the then Secretary of the Department of Defence, Mr Richard (Ric) Smith AO, and his replacement by Mr Nick Warner with effect from 4 December 2006.

I had cause to meet with Mr Smith several times during my first term as IGIS, and found him to be at all times very willing to discuss issues falling within his bailiwick, to provide resources and facilities where necessary to assist my work, committed to accountability, and to be genuinely responsive to the needs of my office.

New Deputy Secretary Intelligence and Security in Defence

As indicated in my previous annual report Mr Shane Carmody replaced Mr Ron Bonighton AM, as the Deputy Secretary Intelligence and Security (DepSec I&S) in the Department of Defence, following Mr Bonighton’s retirement in November 2005.

In October 2006, Mr Carmody accepted an appointment as the Deputy CEO Strategy and Support, with the Civil Aviation Safety Authority.

The then Director of DSD, Mr Stephen Merchant commenced as acting Deputy Secretary I&S upon Mr Carmody’s departure, and was confirmed in that position in February 2007. Subsequent to his appointment, Mr Merchant has also assumed functional responsibility for the International Policy Division of the Department of Defence.

New Director DSD

The short term movement of Mr Merchant to fill the vacancy created by Mr Carmody’s departure, and his subsequent confirmation as DepSec I&S, left a consequential vacancy in the position of Director of DSD.

It was announced in early May 2007 that Mr Ian McKenzie was the successful applicant for this position.

Mr McKenzie has spent many years working in various positions within DSD, and has also had extensive experience in a variety of senior level positions elsewhere within Defence, including as Director DIGO (2003-2006).

New Director DIGO

The filling of the Director DSD by Mr McKenzie naturally left the position of Director DIGO vacant. A senior DSD manager, Mr Clive Lines, accepted an invitation from the Secretary of the Department of Defence to transfer to this position.

Mr Lines has had extensive senior level experience in a variety of positions within the Department of Defence, including DIO and DSD.

Valedictions

Mr Allan Taylor AM

It is with sadness that I note the passing of a former Director-General of ASIS, Mr Allan Taylor AM, who died on 19 June 2007.

Although my term as IGIS did not overlap with Mr Taylor’s time as Director-General of ASIS, I nonetheless had interactions with him in various forums over the years, and developed a very healthy respect for his intellect, his sense of fair play, and his humanity.

Based on the work of my office, I know that Mr Taylor devoted considerable efforts to modernising various management and work practices within ASIS, and making it a more forward looking and responsive agency.

Mr Hadyn Strang

It is extremely unusual for current or former ASIO officers to be publicly identified, whether it be for praise or criticism. Indeed, section 92(1) of the ASIO Act, specifically prohibits the publication of the identity of current or former ASIO officers, without the written consent of the relevant Minister, or the Director-General of Security.

I am therefore grateful to the Director-General of Security for allowing me to briefly highlight the contribution of Mr Hadyn Strang, who sadly passed away on 24 January 2007.

Mr Strang served as ASIO’s principal legal adviser from 1988 until his retirement several years ago, following which he continued to provide legal consultancy services to ASIO.

As the principal legal adviser to various Directors-General of Security, Mr Strang made a huge contribution to ensuring that ASIO’s various legal obligations were being met, and developing guidance and advice on the myriad legal issues which an organisation such as ASIO must confront.

Honours and awards

Dr Peter Shergold AC

The Secretary of PMC, Dr Peter Shergold, was made a Companion of the Order of Australia in the Australia Day honours list, which was announced on 26 January 2007.

By virtue of his position Dr Shergold regularly attends meetings of the National Security Committee of Cabinet as an adviser, and also chairs the Secretaries Committee on National Security. As such, Dr Shergold is vitally involved in guiding the work of the AIC.

Mr Ian Cousins PSM

With the approval of the Director-General of Security, I would like to congratulate Mr Ian Cousins on the awarding to him of a Public Service Medal (PSM), in the Australia Day honours list, which was announced on 26 January 2007.

Mr Cousins has served as Deputy Director-General of Security for many years and has made a very significant contribution to ASIO over very many years. Mr Cousins has received his award for outstanding public service in the delivery of Australia’s security policy framework and critical infrastructure initiatives.

Dr Paul Taloni PSM

Dr Paul Taloni was also awarded a Public Service Medal in the Australia Day honours list, which was announced on 26 January 2007. Dr Taloni received his award for outstanding public service as Deputy Director of the DIO.

Prior to the award being announced Dr Taloni accepted another senior level appointment elsewhere in the Department of Defence. I wish Dr Taloni well in his new position and congratulate him on his award.

Mr Neville Bryan PSM

It gives me special pleasure to advise that one of my own staff, Mr Neville Bryan, was also awarded a Public Service Medal in the Australia Day honours list, which was announced on 26 January 2007.

Mr Bryan was officially recognised for outstanding public service in the monitoring of the AIC. My two immediate predecessors and I have all found Mr Bryan’s commitment, insights and sustained endeavours immensely valuable.

IGIS activities

The functions of the IGIS are set out in detail in the IGIS Act. Broadly speaking the business of my office can be divided into three parts, namely:

Complaints and inquiries

The IGIS Act generally empowers my office to receive complaints about the AIC agencies, and also provides a framework against which they can be processed or inquired into.

If my office receives a complaint which does not fall within our jurisdiction, we will promptly inform the complainant of this fact and whether or not there are any other avenues available to them for consideration of their concerns.

Section 11 of the IGIS Act provides the IGIS with wide discretion on whether or not to pursue a complaint. The underlying presumption of the section is that a complaint against an AIC agency will be pursued, so long as it is within jurisdiction, unless:

Additionally, the IGIS will not pursue an inquiry where a complainant has exercised or exercises a right to cause the action to which a complaint relates to be reviewed by a court or tribunal, unless the IGIS is of the opinion that there are special reasons for doing so.

Having considered whether or not a complaint is within jurisdiction, and determined whether it should be pursued, the IGIS has three options on how next to handle a complaint, namely administratively, as a preliminary inquiry, or as a full inquiry.

The bulk of complaints made to the office are handled administratively and the majority of the complaints in the reporting period related to purported delays by ASIO in processing security assessments for applicants for different classes of visa. I will comment separately on the processing of these complaints elsewhere in this report.

Of the remaining complaints which we receive and process administratively, the majority are dealt with in the office without referral back to the AIC agency which is the subject of the complaint. There are a variety of reasons why this is so, including that the complainant holds genuine but misconceived ideas about the role and functions of the AIC agencies, or the complainant has put forward suggestions which are highly unlikely (i.e. conspiracy theories) or manifestly impossible (i.e. purported new mind control or related technologies).

Notwithstanding that quick judgements can sometimes be made about a number of these complaints, all complaints are taken seriously with complainants being treated with courtesy and respect.

The next means by which a complaint can be processed is by way of a preliminary inquiry. Such inquiries are provided for under section 14 of the IGIS Act, and are ordinarily pursued if there is a question about jurisdiction or if the IGIS requires further information in order to form a view as to whether a fuller inquiry is required. Preliminary inquiries are, as the name suggests, less formal than a full inquiry.

The final means of investigating a complaint is by means of an inquiry, as provided for under Division 3 of the IGIS Act (such inquiries are colloquially referred to a “full inquiries” in our office, so as to distinguish them from “preliminary inquiries”).

Full inquiries are not initiated lightly, as a number of statutory steps need to be complied with, and because the IGIS may utilise his full suite of special powers in the course of a full inquiry.

These powers, which are roughly akin to those which are available to a Royal Commission, include the power to compulsorily obtain information and documents, to enter premises occupied or used by an AIC agency, to issue notices to persons to attend before the IGIS to answer questions relevant to the matter under inquiry, and to administer an oath or affirmation.

During the reporting period the office initiated 13 new full or preliminary inquiries. This compares with 20 such new inquiries initiated in the previous reporting period.

The decline in the number of matters which I judged required a full or preliminary inquiry is an encouraging trend, especially when considered against the substantial growth of the AIC, the numbers of newly trained officers who are now operating in the AIC, and an increasing operational tempo.

During the previous reporting period we received 53 complaints about AIC agencies which did not relate to the processing of security assessments by ASIO. In this reporting period this figure was 65. As can be seen this figure is relatively stable.

During this reporting period my office received 74 complaints about alleged delays by ASIO in preparing security assessments on applicants for various visa categories, which I chose to handle administratively. This represents a very substantial increase on the 26 such complaints OIGIS processed administratively during the previous year.

There are several reasons why the number of immigration related complaints has increased substantially, and these are separately addressed in the chapter on ASIO. Having said that, an increase of this kind is nonetheless disappointing, and certainly an issue which I will be paying close attention to in the year ahead.

A fuller examination of the level of complaints made to this office, and the timeliness with which they were dealt is explored in the ‘Performance’ chapter of this report.

Inspection program

The origins of this office lay in a recommendation made by Justice Robert Hope, in the final report of his Royal Commission on Australia’s Security and Intelligence Agencies, in December 1984.14

Justice Hope had a clear conception of the role of this office, when he suggested that a new body should be established with the proposed title of Inspector-General of Intelligence and Security, rather than another formulation such as Intelligence Ombudsman or Security Commissioner.

“My own preference for the title of such an office is ‘Inspector-General of Security’ (or if, as I recommend in the General Report, the work of the office extends to other agencies, ‘Inspector-General of Security and Intelligence’)15. I believe the title ‘Inspector-General’ is more descriptive of the intended role of the office and is less likely to connote executive responsibilities than the title ‘Security Commissioner’.” 16

In suggesting the title for the recommended new office, Justice Hope clearly conceived that much of the focus of the office would be on inspection activities rather than dealing with complaints.

The underlying rationale for this was that, without undercutting the management prerogatives and responsibilities of responsible agency heads, there would be utility in a body such as IGIS actively monitoring the intelligence agencies to identify issues and trends of potential concern as they arise, rather than trying to deal with such concerns after they have become systematised or major concerns.

The need for such a focus was reaffirmed and emphasised by Justice Gordon J Samuels AC QC, and Mr Michael H Codd AC, in their Report of their Commission of Inquiry into ASIS, which was published in March 1995.17

During the reporting period the resources of the office (apart from what was necessary for corporate and administrative matters) were allocated so that approximately two thirds of the efforts of the office was spent on inspection activities.

As I have stated previously, I firmly believe in the positive effect OIGIS inspection activities have on influencing normative behaviour within the agencies.

The strength of the inspection program is indeed that it is proactive and attempts to influence the culture of the intelligence and security agencies and assists to prevent or forestall problems of illegality or impropriety.

If combined with professional leadership and governance in the agencies, the outcome should mean few, if any, genuine “scandals” and only a very modest rate of the sort of errors which are bound to occur in even the best organisations. It should also mean only a modest number of formal inquiries need be undertaken by this office.

Fuller details of the inspection activities of the office are provided in the individual chapters on each of the agencies, but the activities have included:

Notwithstanding the broad nature of our existing inspection program, there is always scope for it to be varied (so that it does not become stale), and to add new inspection tasks as new powers and functions are provided to the various agencies.

With the recent growth in the size of OIGIS, I also intend to initiate further pilot projects to see if particular extensions to the inspection program would be useful.

Liaison with other Commonwealth accountability bodies

Commonwealth Ombudsman

As detailed in my previous annual report, the Ombudsman and I formally entered into a Memorandum of Understanding (MOU) on 14 December 2005, to provide a framework within which complaints which might overlap our respective jurisdictions might be most effectively handled and unnecessary duplication be avoided.

I was very happy with the manner in which our two offices interacted during the reporting period. While I do not see any current or pressing need to alter the terms of the MOU, I will review its operation periodically, in consultation with the Ombudsman, to ensure that it continues to meet our common objectives.

Australian National Audit Office

Another key Commonwealth accountability agency with which this office has occasional dealings is the ANAO.

Section 16 of the IGIS Act requires that before commencing an inquiry into a matter relating to an agency, the IGIS should have regard to the functions of the Auditor-General in relation to that agency with a view to avoiding inquiries being conducted into the same matter by both agencies.

Although I did not initiate any inquiries in this reporting period which were likely to overlap with the Auditor-General’s role and functions, I have met periodically with the senior executive within ANAO with responsibilities for the AIC agencies to discuss matters of mutual interest or concern.

Australian Commission for Law Enforcement Integrity

The Australian Commission for Law Enforcement Integrity (ACLEI) was established on 30 December 2006 with the coming into effect of the Law Enforcement Integrity Commissioner Act 2006. This Act also established the new statutory office position of the Integrity Commissioner as the head of ACLEI.

Professor John McMillan served as the Acting Integrity Commissioner, for the first six months of ACLEI’s existence, before the Attorney-General announced via a media release dated 22 June 2007, his intention to appoint Mr Philip Moss as Integrity Commissioner, with effect from 23 July 2007. As advised elsewhere in this chapter, Mr Moss spent 10 years in OIGIS between 1987 and 1997, rising to become the inaugural and thus far only Assistant Inspector-General.

Although I expect that there will be little overlap between our respective offices, I welcome ACLEI to the ranks of Commonwealth accountability agencies, and congratulate Mr Moss on his appointment.

Community outreach

Although OIGIS is quite a small office it is important for the existence of the office to be known to as many people as possible. To this end, my staff and I contributed to, or participated in, a number of targeted outreach activities during the reporting period to raise awareness of the office within the community.

One means by which this was achieved was through our contribution to a small but important publication coordinated by ONA entitled The Australian Intelligence Community: Agencies, functions, accountability and oversight18, which was publicly launched by the heads of the AIC agencies and myself on 20 October 2006.

The brochure is the first occasion on which the AIC has attempted to simply set out in a public document its role and functions, the inter-relationship of the agencies with the higher-level intelligence setting and coordination committees, and the accountability and oversight framework in which the AIC operates.

In addition to the above initiative, my office arranged for the brochure explaining the role and functions of the IGIS to be translated into another 12 community languages, bringing the total to 16. Hard copies of these brochures have been circulated to relevant government offices and to interested community groups, and are also freely available electronically on our website at
<http://www.igis.gov.au/>.

I additionally spoke about the role and functions of the office, or participated in panel discussions, at the following forums during the reporting period:

Training

As the AIC continues to recruit heavily, and more persons become engaged in intelligence related activities, I believe it is vitally important for the underlying rationale for existence of my office, its role and functions, to be explained and for my staff and I to be as visible as possible.

As a consequence I and members of my staff have actively sought to make presentations at suitable agency training courses and seminars as often as possible. In this reporting period OIGIS made at least 48 such presentations to at least 1,100 staff from across the six AIC agencies, at different locations across Australia.

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

In addition to delivering presentations on the role and functions of the IGIS, members of my staff and I have also attended several agency training courses either as participants or observers.

International cooperation

During the reporting period, we again received a number of international visitors. Notable among these were visits from individuals in the senior ranks of the United Kingdom and Canadian governments who have responsibilities for intelligence and security arrangements in those countries.

IIRA Conference 2006

In October 2006, I attended the fifth International Intelligence Review Agencies (IIRA) conference, which was held in Cape Town, South Africa. The rest of the Australian delegation to the conference comprised the Hon. David Jull MP (Chair of the PJCIS), Senator the Hon Robert Ray and Mr Stewart McArthur MP (also members of the PJCIS), my Principal Investigation Officer, Mr Neville Bryan PSM, and the then Secretary to the PJCIS, Ms Margaret Swieringa.

The first meeting of what has subsequently come to be known as the IIRA conference occurred in October 1997, and was organised by the then IGIS, Mr Ron McLeod AM, to mark the 10th anniversary of the creation of this office.

The IIRA conferences have occurred approximately every two years since the inaugural gathering, rotating between the six nations which attended the first meeting (i.e. Australia, Canada, New Zealand, South Africa, United Kingdom and United States of America).

The theme of the conference in South Africa was ‘Balancing National Security and Constitutional Principles within a Democracy’.

As well as the inaugural members of the group, participants were also drawn from Belgium, Ghana, Namibia, the Netherlands, Norway, Poland and Tanzania.

Due to our historical, cultural and constitutional development Australia is naturally more likely to share views with countries with whom we have been traditionally aligned, however, it was an extremely useful and worthwhile exercise to hear the perspectives of delegates from outside of this realm and to learn more about the approaches of their countries to issues of intelligence oversight and accountability.

I wish to sincerely thank the co-hosts of the conference, the Hon. Dr Siyabonga Cwele (Chairperson of the South African Joint Standing Committee on Intelligence) and the Hon. Zolile Ngcakani (South African Inspector-General of Intelligence), and their hard-working staff, for putting together a most interesting and thought provoking program, for making all delegates so very welcome, and for organising what was a first class conference.

The sixth IIRA conference is to be hosted by New Zealand in 2008, following which hosting responsibilities will fall once more to Australia, at a date and venue to be determined, some time in 2010.

Other foreign visits

In April 2007 I visited some regional countries. The purpose of these visits was to meet with AIC staff, to gain some insight into their activities and to examine the various formal liaison arrangements which exist with local authorities.

In June 2007 I made a presentation to the Administration of Justice and National Security in Democracies conference, which was held in Ottawa, Canada, having been invited to do so by the conference organiser, the Hon. Allan Lufty, Chief Justice of the Canadian Federal Court.

The conference, which featured papers from, and round table discussion with, high ranking jurists from several jurisdictions, provided me with new insights into Canadian and United States approaches to issues with which we are also grappling.

The accountability of law enforcement and intelligence agencies is an issue to the fore in Canada following the release of two reports of a major public inquiry into the case of a Canadian citizen, Mr Maher Arar, who was rendered from the United States to Syria where he was imprisoned for one year and suffered degrading and abusive treatment.

The reports by Justice O’Connor (Associate Chief Justice of Ontario and Commissioner of the Inquiry) examined both Mr Arar’s individual case and the adequacy of existing policing and intelligence oversight arrangements in Canada.

I also took the opportunity of my visit to Canada to meet with members and staff of the Canadian Security Intelligence Review Committee, the Inspector-General of the Canadian Security Intelligence Service, the Commissioner of the Communications Security Establishment and his office, as well as a range of government officials operating in areas in which I have a functional interest.

Significant issues

In this reporting period my office either had a direct involvement in or monitored a number of issues of public interest or significance. A brief summary of these issues is provided in this section, with a fuller discussion of some of these matters provided in relevant chapters elsewhere in this report.

Review of ONA statutory independence

In the Report of the Inquiry into Australian Intelligence Agencies published in July 2004, the report’s author, Mr Philip Flood AO, recommended that the IGIS should conduct periodic reviews of ONA’s statutory independence.19

Mr Flood explained the rationale for this recommendation in the following terms:

“Given the nature of the assessment business, where individuals’ judgements are a key factor in the final product, and ONA’s direct line of responsibility to the Prime Minister, with the consequent potential for charges of political interference, there is a need for some external process to ensure independence is preserved, and is seen to be so. This relates to the content of what is reported, and to what is not reported.”20

The Flood report also emphasised that “…while intelligence priorities should be driven by policy needs, intelligence judgements must be uninfluenced by policy or political considerations”.21

So as to give practical effect to Mr Flood’s recommendation, the IGIS Act was amended, with effect from 2 December 2005, by the inclusion of subsection s8(3)(c). This subsection provides that, the IGIS may:

“at the request of the responsible Minister or of the Inspector-General’s own motion, … inquire into any matter in relation to the statutory independence of ONA.”

Section 35(2) of the IGIS Act was amended at the same time so as to require that the IGIS include in his or her annual report, comments on any inquiry conducted in accordance with the new s8(3)(c).

In the second part of the previous reporting period I initiated a review of ONA’s statutory independence, using as my authority the general inspection powers afforded to the IGIS under section 9A of the IGIS Act.

This inspection activity involved reviewing various lines of ONA assessed products, surveying and interviewing ONA analysts and senior managers, interviewing customers of ONA products, and interviewing senior ministerial staff members.

I concluded this activity with the presentation of a report of my findings to the Prime Minister on 15 December 2006.

A fuller description of these processes and a general summary of my findings is provided in the chapter on ONA and at Annex 6.

While I do not believe that it is necessary or appropriate to continually conduct review of ONA’s statutory independence, I was keen to build on the work done via my first review, and therefore decided in January 2007, to initiate a follow up review, which would be undertaken as a formal inquiry, as provided for under subsection 8(3)(c) of the IGIS Act. I did so to enable a more in-depth analysis of issues associated with ONA’s statutory independence.

This inquiry into ONA’s statutory independence was on-going at the conclusion of this reporting period.

Security assessment of UK citizen Mr Rhuhel Ahmed

In October 2006 I was alerted by media reporting of claims that a former Guantanamo Bay detainee, Mr Rhuhel (sometimes rendered as Ruhal) Ahmed, had been denied an entry visa into Australia, allegedly on advice from ASIO, thereby denying him the opportunity to speak to audiences in Australia about his experiences, and to promote a related film, of which he was a subject.22

Shortly afterwards I received 37 letters, expressed in nearly identical terms, from members of the public expressing concern that Mr Ahmed had been denied a visa to enter Australia. Each of these correspondents asked me to investigate what role ASIO had played in this decision, and whether the decision was politically or otherwise improperly influenced.

Having separately reflected on the merits or otherwise of formally pursuing the matter, I initiated a formal inquiry on 28 November 2006.

The inquiry I conducted involved a review of all relevant documentation associated with this matter, consideration of the legal and administrative framework in which the decision to refuse Mr Ahmed a visa was made, the conduct of interviews/discussions with relevant ASIO personnel, and also obtaining statutory declarations from several ASIO officers with a connection to the matters under review.

I concluded my inquiry and provided a full report of my findings to the Attorney-General and the Director-General of Security on 12 March 2007.

I subsequently wrote to each person who made a complaint to my office (where we had sufficient contact details) on 2 April 2007 attaching an unclassified version of the report I had provided to the Attorney-General.

The conclusion I reached was that ASIO had been involved in making a security assessment of Mr Ahmed, in response to his application for a Business (Short Stay) Visa, and that in doing so it had acted legally and properly. There was no evidence or indication that the assessment had been the subject of improper influence.

A copy of my unclassified report into this matter is provided as Annex 3 to this annual report.

NSW coronial inquiry into the late Mr Brian Peters

As advised in last year’s annual report23 the NSW Coroner has been conducting an inquest into the death of Mr Brian Peters in East Timor, in October 1975. Mr Peters was one of five newsmen killed at that time who have come to be collectively known as the ‘Balibo Five’.

My predecessor, Mr Blick, conducted an extensive investigation in 2000–01 into claims that intelligence information said to have been in the possession of DSD before the killings was not passed on to the government, and that if it had been, the Balibo Five could have averted their fate.

Mr Blick ultimately concluded that intelligence material meeting the above description did not exist, although there was intelligence material relating to journalists in Timor. Mr Blick further concluded that all relevant material held by DSD was passed to government and that DSD did not deliberately withhold a particular item of intelligence.24

After at least one year of preparatory investigations, the NSW Deputy Coroner, Ms Dorelle Pinch, began a series of public hearings in February 2007, taking evidence in relation to a wide range of matters associated with the death of Mr Peters. These hearings were conducted over a number of weeks between February and June 2007, and involved a wide variety of witnesses including a number of former employees of the ADF/Department of Defence, including several who were associated through their work with DSD.

In his summary of the evidence which had been adduced before the inquest, the senior Crown counsel assisting the inquest, Mr Mark Tedeschi QC, was reported as saying that despite the historical record of intelligence records relating to the Balibo incident being incomplete, there was no sign of any conspiracy by the government to withhold relevant intelligence from the inquest.25

Mr Stephen Merchant (Deputy Secretary Intelligence, Security and International Policy, Department of Defence) also sought to set the record straight, as he saw it, on a report in The Age newspaper that quoted the senior Crown counsel assisting the inquest as saying “seven intercepts of Indonesian military signals relating to Balibo (were) evidently lost, misplaced or destroyed…”.

In a letter which was subsequently published in The Age26, Mr Merchant said that the words attributed to Mr Tedeschi about records being lost, misplaced or destroyed, were not actually used by him in his final oral submission to the coroner. Mr Merchant referred to the possibility that references to missing intercepts may simply be a reflection of the fact that in some instances, 32 years after the event, witnesses’ recollections did not exactly match the document trail.

Mr Merchant concluded his letter by stating that:

“I can assure the public that the Defence Signals Directorate has gone to great lengths to ensure that all documentation it holds regarding the deaths of the newsmen in Balibo in 1975 has been made available to the inquest.”27

In early June 2007, the NSW Deputy Coroner adjourned the inquest until a date to be fixed, at which time she would deliver the report of her findings. It is expected that this will be sometime in the first half of the 2007–08 reporting period.

It would be inappropriate for me to comment on matters which are still before the Coroner, other than to state that I have naturally been following these proceedings closely.

The Cole ‘Oil-for-Food’ Commission

On 10 November 2005 the Hon. Terrence Cole AO RFD QC was appointed to conduct an inquiry into and report on whether decisions, actions, conduct or payments by various Australian companies mentioned in the Final Report of the Independent Inquiry Committee into the United Nations Oil-for-Food Programme breached any Federal, State or Territory law.

Commissioner Cole conducted a series of investigations and public hearings relevant to his terms of reference, before ultimately presenting the Report of his Inquiry to the Governor-General on 24 November 2006.

I advised in my previous annual report that I had not felt it necessary for me to initiate an inquiry into the conduct of any of the AIC agencies in relation to these matters while Commissioner Cole’s inquiry was in progress, but would consider this again when Commissioner Cole’s report was finalised.28

Having now had the opportunity to read and reflect upon Commissioner Cole’s report, having regard to the detailed and forensic nature of Commissioner Cole’s investigations, and the fact that no adverse findings or imputations were made about the AIC in general, or any AIC agency in particular, I am not minded to initiate an ‘own motion’ inquiry into any AIC agency, in relation to these matters.

Footnotes
13 See IGIS Annual Report 2005-2006, Canberra, October 2006, p. 23.
14 Justice R. M. Hope, Royal Commission on Australia’s Security and Intelligence Agencies, General Report, AGPS, Canberra, December 1984, p. 25, paragraph 3.26.
15 Elsewhere in the General Report, and in his report on ASIO, Justice Hope reformulated the title of the proposed office as the ‘Inspector-General of Intelligence and Security’.
16 Justice R. M. Hope, Royal Commission on Australia’s Security and Intelligence Agencies, Report on the Australian Security Intelligence Organization, AGPS, Canberra, December 1984, p. 330, paragraph 16.85.
17 Justice G. J. Samuels, and M. H. Codd, Report on the Australian Secret Intelligence Service, Public Edition, AGPS Canberra, March 1995, p. 94, paragraph 9.4.
18 This publication can be accessed at  <http://www.ona.gov.au/publications/aic.htm> (as at 10 August 2007).
19 Flood, op. cit., p.106 and p. 180.
20 ibid., p. 105
21 ibid., p. 9.
22 See for example, ‘ASIO thwarts film promotion’ by Mr Garry Maddox, The Sydney Morning Herald, 28 October 2006.
23 IGIS Annual Report 2005-2006, Canberra, October 2006 pp. 8–9.
24 An unclassified version of Mr Blick’s report was published at Annex 3 to the 2001-2002 IGIS Annual Report, pp. 82–90.
25 ‘MP’s ‘dupes’ in game of deceit’ by Hamish McDonald, The Age, 31 May 2007.
26 Letters to the Editor, ‘For the record’ by Mr Stephen Merchant, Department of Defence, published in The Age on 6 June 2007, p. 20.
27 ibid.
28 IGIS Annual Report 2005–2006, op.cit. p. 9.

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