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Wednesday, 1 June 2005
Page: 100

Mr McCLELLAND (4:28 PM) —The opposition supports the second reading of the Maritime Transport Security Amendment Bill 2005. It amends the Maritime Transport Security Act 2003 in respect of two issues which are summarised in the explanatory memorandum. First, the bill extends coverage of that act to offshore oil and gas facilities located within the territorial sea, in Australia’s exclusive economic zone and on the continental shelf and ensures that all regulated offshore oil and gas facility operators and other prescribed offshore industry participants develop and comply with an offshore security plan based on a security assessment of each regulated facility. Second, the bill amends the act to allow for the introduction of maritime security identification cards. The cards will be introduced to cover unmonitored personnel who are required to access what are called maritime security zones, which may be areas in ports, areas surrounding ships or areas on ships.

The card scheme will require the prospective holder to submit to a check of their background. These background checks will comprise a criminal history check undertaken by the Australian Federal Police and a security assessment by ASIO. If required, it may also be necessary to conduct an unlawful noncitizen check by the Department of Immigration and Multicultural and Indigenous Affairs. These cards will only be issued to persons who have successfully met background checking requirements. Of course, members will be familiar, as a result of the debate in the chamber over the last two days, with matters concerning a similar security card scheme that applies in our aviation industry, but all members will be anxious to ensure that the scheme operates successfully and not, as we would submit in respect of the aviation industry, with so many flaws in it.

Before I begin a discussion of the bill, it is appropriate to appreciate the environment in which we are placed as a nation and, in particular, the significance of our maritime environment. The threat of terrorism to Australia and the perceptions we have of such risks have to a large extent been shaped by recent global events including the September 11 attacks in New York and Washington and the Madrid bombings in Spain, but it was of course the bombings in Bali that drove home the devastating reality and proximity of the threat of global terrorism to Australia and Australian interests. Unfortunately, subsequent to the events in Bali, we have seen that with the bombing of Australia’s embassy in Indonesia.

To a large degree, Australia’s unique geographic location in the world has shielded us from some of the excesses of interstate conflicts and acts of global terrorism but, again, with the Bali bombings as an indication of the activities of terrorist based organisations in our region, we cannot dismiss the prospect. Indeed, when I was in the United States last year the experts there repeatedly stated, ‘You guys are living in a dangerous neighbourhood,’ in terms of the prospect of exposure to terrorism in the South-East Asian region. But Australia’s unique geography as an island continent certainly makes the maritime zone particularly important to us. Unfortunately, it is a zone that is particularly vulnerable.

One must always guard against inflating the reality of the threat posed by terrorism so that our response is reasonable, balanced and sensible and does not, by overreaction—either by breaking down our systems, structures and rule of law and so forth or by imposing unrealistic and unreasonable expense on participants—itself damage either our body politic or our economy. But it is worth noting that in April 2004 ASIO reported on the threat of terrorism to Australia’s shipping and port infrastructure. They stated in that report, in summary, that the al-Qaeda network in South-East Asia have stated an intent to attack Australian interests and that they have the capacity to conduct acts of terrorism, including maritime terrorism. ASIO stated that al-Qaeda’s capacity to conduct terrorist attacks continues to develop, but they concluded that the threat to most of Australia’s port facilities and infrastructure was rated as low, but that some, which for obvious reasons have been left unidentified, were rated at a medium level of threat. These are issues that cannot be ignored.

In terms of terrorism support and operational infrastructure in South-East Asia, it is unfortunate that terrorist organisations clearly still have access, as a result of their economic circumstances, to a population that is substantially underprivileged, has its own grievances and is openly exploited by those who promote extremist views. Unfortunately, they also have access to resources, frequently from other parts of the world. Those groups that we are familiar with include Jemaah Islamiah, which continues to flourish. Since 1997 the al-Qaeda network in South-East Asia has planned and conducted terrorist attacks against maritime personnel and infrastructure on land and at sea. Indeed, as I have mentioned, our embassy has been a target.

Since 11 September 2001, al-Qaeda and associated groups have consistently indicated that the energy sector in particular is a target. They see the energy sector as being particularly vital to world economic prosperity. Al-Qaeda have articulated plans to ‘cripple the petroleum industry’ with sea based attacks against oil tankers, and the maritime capabilities can be developed quickly. We recognise that the use of speedboats packed with weapons or explosives which can be used to evade law enforcement authorities and with a suicide bomber in control unfortunately has the potential to cause great destruction, particularly to our offshore oil and gas facilities. There have also been attacks on oil facilities and personnel in the Middle East, such as the attempts on the al Basra and Khor al Amaya oil terminals of southern Iraq on 24 April 2004.

Al-Qaeda has in fact identified Australia as a legitimate target on seven separate occasions and has carried out threats and actions intended to damage Western economies and in particular, as I have mentioned, the oil and gas industry as a vital part of Western economies. The oil and gas sector in Australia brings in excess of $18 billion annually into our economy. The predominance of a small number of offshore oil and gas installations supplying Australia’s domestic and overseas energy markets makes these facilities critical elements of national security infrastructure and attractive targets for terrorists in the current security sensitive environment. Because of regional and global economic independence, terrorist events in one region can impose significant flow-on costs and cause damage to other areas of the global economy. Countries that fail to combat terrorism and ensure the safety of trade can expect to incur significant costs in trade and investment opportunities.

Numerous studies have been undertaken to assess the economic risks from maritime terrorism. In terms of maritime trade, for example, one study found that closing down all United States ports for a period of seven to 10 days would cost the United States economy some $75 billion. By way of comparison, Melbourne’s ports handle some $70 billion in trade every year and support some 20,000 jobs, while Sydney’s ports handle in the order of $45½ billion in international and domestic trade and generate more than 17,000 jobs.

In 2003, the Economic Analytical Unit of the Australian Department of Foreign Affairs and Trade produced a report on the overall cost of terrorism, with particular emphasis on maritime terrorism. It found that, while the cost of unchecked terrorism is significant for all economies, terrorism could pose a disproportionately high cost for the economies of the countries in our region—in particular, those that are continuing to develop.

The study found that most developing APEC economies depend more heavily on trade flows, particularly with the United States and OPEC economies; many regional developing economies rely on receiving strong foreign direct investment, which would be at risk from an increase in terrorist activities; and insurance premiums may be higher on cargoes and vessels travelling to and from developing countries because of uncertainty about the adequacy of local security procedures. We must bear in mind that the majority of our cargo comes through the regions which are exposed to those sorts of threats. The secure flow of maritime trade and production is therefore essential to the economic and national security interests of Australia, the region and indeed the globe.

Australia’s offshore oil and gas industry is currently not covered by the act, and therefore is not operating in a manner that is consistent with Australia’s maritime security regime. That regime requires certain maritime industry participants, such as ships and port operators, to develop and implement risk based security plans that contain details of access controls, maritime security zones and protocols for dealing with maritime security incidents and threats. At present, there are no formal mechanisms for responding to a potential terrorist attack. There are also no adequate mechanisms for dealing with unlawful access to offshore oil and gas facilities. The bill will bring the security of offshore oil and gas facilities in line with existing maritime security arrangements, providing a regime for these facilities to reduce the risk of unlawful interference.

There will be two main industry groups affected by the bill. The first are the operators of the offshore facilities. The second will be the various service providers to these facilities—notably, helicopter charter operators and ship based equipment stores supply services. Obviously, those services have access to these offshore installations. Under the bill, offshore oil and gas facilities will be required to develop security plans, as I have indicated, that consider the risk-assessed needs of the operators, including the special nature and location of the facilities.

The offshore facilities vary from conventional steel fixed platforms and concrete gravity platforms through to miniplatforms, monotowers, monopods and minipods, floating storage and offtake units and floating production storage and offtake units. These facilities will primarily be to the north and, in particular, north-west of Australia. These plans will be submitted to Department of Transport and Regional Services for approval, and they should complement existing safety plans that operate on those platforms. DOTARS will be responsible for regulating the offshore oil and gas industry security plans and for auditing these facilities to ensure they comply with the regulatory regime established by the act and the regulations. The bill puts in place the same risk based security planning for offshore oil and gas service providers—that is, contractors of specialist offshore related services or port related services, as I have mentioned, such as helicopter and supply vessel service providers.

DOTARS have indicated that they expect to receive 40 security plans and that they anticipate the cost of developing a security plan will be in the order of $50,000 for each facility. In accordance with the stated government policy that security is the cost of doing business, DOTARS have confirmed that industry will bear the cost of preparing those plans and that DOTARS will recover the cost of dealing with them. DOTARS have also indicated that they expect to receive draft security plans from facilities by 1 July 2005 and expect to have the security regime in place by 1 October 2005. In that sense the government claims—and the opposition recognises—some urgency in the passage of this legislation.

Under the bill, access to what are called maritime security zones—which may be areas in ports, areas surrounding ships, or areas on ships—are generally managed by each individual port or ship operator. However, there is no common legislative requirement for how these operators should ensure that only properly authorised persons can access these zones. At present, therefore, there is no regime in place that requires background checking of people working in Australian ports, ships and offshore oil and gas facilities, as is the current situation, as I have mentioned, in the aviation industry and in the maritime industry in comparable Western countries.

The security card identification scheme will be a nationally consistent identification card that states that the holder has met the background checking requirements to work in a designated maritime security zone. The card, however, is not an access control card. Anyone who requires unmonitored access to a maritime security zone will be required to have a maritime security card. They will include, among others, dock workers, truck drivers and rig workers. Applicants apply for the card from an issuing body. Private companies, employee trade unions or industry associations, among others, are entitled to apply to be an issuing body as long as they have the capacity to perform the regulatory function.

Through publicised fact sheets the department has indicated that the issuing bodies will not be given access to personal information gathered through background checking; rather, following the background checks conducted by the appropriate government agency, the relevant issuing body will only be advised as to whether the employee can be issued with an MSIC or not. We understand that the estimated cost of issuing the MSIC is in the order of $40 to $60, including the cost of conducting relevant background checks. The legislation provides that regulations will be made to enable the issuing body to recover the costs of issuing the cards. Although the framework for issuing the cards will be set out in regulations, these regulations, unfortunately, have yet to be issued. Despite assurances by the government that the opposition would be provided with, at the very least, a draft version of these regulations, we are yet to see the content or scope of the regulations. Obviously we would be assisted in the consideration of these measures if we could have access to at least the draft documents as expeditiously as possible.

At present, the bill merely allows the bodies that will be responsible for issuing MSICs to recover the costs involved in administering the process, including background checks. Again, however, we are yet to see how these costs will be passed on to employees who require security checks—many of whom, of course, will have worked in these industries for some years. MSICs are issued after the completion of several background checks, as I have indicated, including a criminal background check by the AFP and a security assessment by ASIO. If required, an unlawful noncitizen check will be conducted by DIMIA. As yet, we have not been informed as to the level of criminality that will prevent an individual from receiving an MSIC or had a chance to consider the appropriateness of how this level of criminality is determined. Of course, today in question time there was controversy as to whether or not a person who has served some eight years in prison for drug trafficking should appropriately have been issued with an aviation security card. These are issues we would like to contemplate and explore with respect to the appropriate level of offence that applies to the issuing of the maritime security card.

While we understand that those unions that have predominant coverage of offshore platforms have been consulted, there are concerns that a number of smaller unions representing individual trades may not have been consulted—although we recognise that common issues will obviously arise with respect to all unions and their members. In the context of revelations emerging around security failings at airports this week, it is worth noting, however, that the mere issuing of these security cards is no panacea against the potential for unlawful interference at an Australian port facility, ship or offshore platform. If there is simple access by a swiping system without face-to-face verification, obviously the system will be exposed to the theft or transfer of cards.

Given the concerns that we have raised, it is the opposition’s view that, while a second reading of the bill should be supported in the House, the bill should be referred to the Senate Rural and Regional Affairs and Transport Committee for a short inquiry to examine, among other things, the concerns I have just raised. We will therefore be seeking a short turnaround time for the committee to conduct the inquiry so that we can ensure the expeditious passage of the bill, which we recognise is important legislation. Again, the inquiry itself and the resolution of these concerns would obviously be assisted by the government providing a copy of the draft regulations that will accompany this legislation as soon as possible.

The government’s principal approach to maritime security protection, it must be said, is by legislative and regulatory means. Essentially, it is a light-touch approach where the legislative and regulatory framework is set by the government, but how that is complied with is essentially up to the private operators. In 2003 the opposition welcomed the passage of the Maritime Transport Security Act in order that Australia could develop and implement a nationally consistent maritime security framework. However, a point we repeatedly make is that legislation and regulation alone are incapable of preventing security threats and breaches at our ports, on our ships and on our oil and gas facilities.

We note that in April this year the Australian Strategic Policy Institute published a damning report into the state of Australia’s security arrangements entitled Future unknown: The terrorist threat to Australian maritime security. This report identified a number of failings: a lack of specialised port police as seen operating in the United States and United Kingdom; an absence of a comprehensive security framework for the supply chain of container transportation across the Australian continent; inadequate security checks of crews from foreign flagged vessels arriving in Australian ports—in 2002, a total of 115,000 foreign crew arrived; an absence of a nationwide approach to manage the security of high-risk ships, such as foreign naval vessels and ships carrying dangerous goods like ammonium nitrate and other petrochemical substances; a lack of coordination between relevant agencies including Customs, Navy, the Department of Transport and Regional Services and state agencies; a lack of consistency between state and territory jurisdictions and their legislation covering maritime security; and a lack of critical information and data to properly assess the vulnerability of Australian ports.

Despite its consistent and often shameless ‘tough on security’ oratory, the government is undeniably failing in these key structural areas. The concerns raised by the ASPI are not new; federal Labor has been highlighting maritime security problems month after month, year after year, but the concerns are now clearly articulated by an expert body specifically established by the government to provide frank strategic advice.

The only response to this report that has come from the Deputy Prime Minister and Minister for Transport and Regional Services was:

... it was unlikely the Government would adopt the recommendations ... we’re continuing to look for any holes that might emerge in our maritime security net.

We believe it is high time the government not only looked for these holes in our maritime security arrangements but acknowledged that the holes exist and that they constitute a significant threat to Australia’s national security. The government must listen to this independent, expert advice and act swiftly to remedy the litany of threats to our maritime security. We need a commitment from the government that they will address these problems and assure the Australian public that their borders are secure and that the government are on the job.

In that context, we note that the Inspector of Transport Security, who was removed from office in February this year to conduct the Rau inquiry, also had responsibility in respect of maritime security when that office was originally established. As part of the national transport security plan it was stated that the mandate of that office would be to investigate major incidents and systematic transport security weaknesses to ensure security vulnerabilities were identified and addressed. That plan talks of a protective role and there is probably no-one better in Australia than former Federal Police Commissioner Mick Palmer to undertake that role, yet for the last four months, and despite the cost of his office being some $400,000 per annum, he has not been performing that function because he has been putting out other bushfires for the government in the form of the Rau inquiry and the immigration scandal that that matter involves.

Given that this regulatory regime is so light in touch—with the obligation for implementing schemes being essentially on the operators—an effective inspection regime is absolutely crucial to security. Moreover it must be one that is at arm’s length from the government. The minister can talk about the resources of the department of transport’s security wing—and certainly our inspection of that facility indicates that it is staffed by extremely competent people—but the bottom line is that these are issues of immense concern to our national interest and should be investigated without fear or favour by an independent office holder such as the Inspector of Transport Security. If, as a result of political pressure, the minister has dumbed down or neutered that role to be a post-fact role—that is, investigating a terrorist event after it has occurred—we sensibly ask the minister to revise his assessment. We ask the officials and experts that advise the minister to say, ‘Listen, if we want to ensure that everyone is doing the very best they possibly can in this area we must restore that independence.’

There has been some progress in maritime security, with the creation of the Joint Offshore Protection Command. The Minister for Foreign Affairs seemed to have been given the brief, prior to the last election, of ridiculing, with all the fanfare that he could muster, Labor’s plans to establish an Australian coastguard. But irrespective of whether or not you agreed with Labor’s plan for a coastguard there was and there remains a need for greater coordination of our maritime security zone.

Currently we have eight Customs vessels and 15—it will be 14—naval patrol vessels. Each of the eight Customs vessels comes under the command chain of the Australian Customs Service and obviously the naval vessels come under the command structure of the Royal Australian Navy. Essentially, under Labor’s plan they had their resources seconded from requests from the coastguard but in this case they will receive requests from the Joint Offshore Protection Command.  If that structure is to work effectively as a joint offshore protection command it seems logical that it should be given statutory recognition, and any vessel, crew or officer seconded to undertake work for the command should sensibly be under the control of the command.

We recognise that the quality of senior officers in the Joint Offshore Protection Command is exceptional but they should be given the authority to have a system of protection. The fact that it is based on the fragmented laws and agency structures that we still have in our maritime zone is unsatisfactory. Whether or not the government, for political reasons, disputes the need for the establishment of a coastguard, this needs to be refined. It needs to be coordinated and responsibility needs to be given to an authority with independent statutory control and command. Unless and until we do that there is always going to be a risk that security incidents fall between the competing responsibilities of respective agencies. In summary, we are talking about words on pieces of paper. We support these measures but our point is that words are not enough—we need detailed coordinated action to protect our maritime zone.