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Thursday, 12 August 2004
Page: 26360

Senator HUTCHINS (3:50 PM) —I present the report of the Foreign Affairs, Defence and Trade References Committee entitled Bali 2002: security threats to Australians in South East Asia, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

Senator HUTCHINS —I seek leave to move a motion in relation to the report.

Leave granted.

Senator HUTCHINS —I move:

That the Senate take note of the report.

The DEPUTY PRESIDENT —Before you begin, I understand that an agreement has been reached on the allocation of times in this debate and I ask clerks to set the clock accordingly.

Senator HUTCHINS —To open my remarks I would like first of all to thank the previous chairman, Senator Peter Cook, for presiding over this committee up until 25 March this year, and also to commend the herculean efforts of the committee secretariat, in particular the secretary, Brenton Holmes, and his staff. Mr Deputy President, this report on the tragedy that was Bali opens with an important quote:

There is, I think, a tendency for us all to forget the self-evident truth that you cannot look forward with certainty, only backwards. Knowing an end point, it is easy to interpret, or reinterpret, the past.

This has been a very difficult task for the committee. We are conscious that for everyone involved, particularly the Bali victims, but also the government officials involved, the experience of the Bali bombings has been a life-changing one. It is one that all those affected will continue to reflect upon, often in anguish, for a long time to come. That Bali was a disaster is a cruel but simple fact of contemporary history. It was not so as a result of some culpable lapse by Australian government agencies or individual officials. Yes, there was a `failure of intelligence', but limitations on intelligence do not necessarily imply limitations on the skill and integrity of intelligence agencies.

The committee is satisfied that, on the basis of the evidence we received, there was no specific warning of the Bali attack. ASIO had, from September 2001 onwards, assessed the threat to Australian interests in Indonesia as high. Throughout 2002 there was a persistent escalation of advice as agencies came to better appreciate the capacity and intent of JI. This advice was variously conveyed in widely disseminated formal written `product'. The committee considers that travel advice about Bali being `calm' and with tourism `normal' reinforced the view that Bali was safe exactly when the terrorist threat to Westerners in Bali was the highest it had been. The advice sent the wrong message but was strictly correct and was deliberately included by DFAT in response to many questions about the state of affairs in Bali.

While it would be reasonable to assume that anyone reading the travel advice would understand that there was a generic terrorist risk—that bombs had exploded in the past, including where tourists gathered, and that further explosions may be attempted—what the travel advice reader may not have appreciated was that Bali was no safer than any other part of Indonesia in terms of the terrorist risk or the likelihood of a bomb going off. Bali has a special place in the minds of Australians as a safe, relaxing place where they can let their hair down. Travel advice should have taken that into account. Appropriate advice would have been along the following lines: `Bali has long been considered a safe haven, but the risks of terrorism are as high there as elsewhere in Indonesia.' Given that prior to the bombings around 200,000 Australians visited Bali each year, that sort of advice would have sent the right message. While this suggestion benefits from hindsight, it is also a properly contextualised, relevant and measured piece of factual advice, entirely consistent with ASIO's uniformly high threat assessments and the general intelligence picture at the time, and it also takes into account the mind-set of Australian visitors to Bali.

For DFAT, threat assessments produced by ASIO were a key consideration in the formulation of travel advice. Both ASIO and DFAT have stated to the committee that, notwithstanding the solid relationship and good communication that existed between the two agencies prior to Bali, their roles were `too compartmentalised' when it came to the preparation of travel advice. That situation was reviewed immediately after Bali, and new arrangements were put in place which integrated ASIO into the process whereby DFAT's Consular Division, its South and South-East Asia Division and its Jakarta embassy formulate travel advice. ASIO is now required to tick off on travel advice pertaining to any region where the ASIO threat assessment is high.

The committee is mindful of the fact that it has been unable to have access to the underlying intelligence assessments which gave rise to the threat assessments and travel advisories constructed by DFAT on that basis. Further, the committee is also mindful of the fact that the only previous inquiry conducted into these matters by the Inspector-General of Intelligence and Security did not have any terms of reference empowering him to examine the correlation between underlying intelligence assessments, threat assessments and travel advisories. For these reasons, the committee is of the view that the country's future arrangements in these areas may be advantaged by an independent commission of inquiry with specific terms of reference to address these and related matters.

During the year before the Bali bombings, DFAT travel advice contained generic threat advice. In July 2002, the travel advices were strengthened to convey to travellers the need to `monitor carefully developments' and to `maintain a high level of personal security awareness'. The advice also warned that bombs had been exploded `including in areas frequented by tourists' and that `further explosions may be attempted'. This language and warning level was appropriate to convey the level of this generic threat but, in the committee's view, the formation, information and warnings contained in the travel advisories for Indonesia during the month or so before the Bali attacks, while warning of an increased generic terrorist threat, nonetheless did not adequately reflect the content of the threat assessments that were available by that time that specifically warned that Australians in their own right were now seen as terrorist targets in Indonesia. (Time expired)

The DEPUTY PRESIDENT —Senator Hutchins, I understand you want to seek leave to incorporate the rest of your speech.

Senator Hutchins —Yes, Mr Deputy President.

Leave granted.

The speech continued as follows—

The Committee agrees that ASIO properly assigned a threat level of HIGH to the situation in Indonesia (and thereby Bali). The Committee notes that ASIO, along with other agencies, was assiduous in the production of intelligence advice throughout the period as it came to better understand the nature, capabilities and intentions of JI. The Committee also appreciates that at no time was it appropriate for ASIO to issue a threat assessment at the top of its threat scale—something which would have required the threat to be confirmed by specific, reliable information about an attack.

But the majority of the Committee has somewhat different views from those held by the intelligence agencies about the particular vulnerability of Bali at least so far as these were conveyed to the Committee by agency heads during the Committee's hearings. Agency heads repeatedly told the Committee that the concentration of Australians in Bali, of itself, did not render Bali a more likely target than elsewhere. The majority of the Committee does not share that view.

DFAT has made major efforts to enhance the dissemination, accessibility and intelligibility of its Travel Advice, and to ensure that it works in close partnership with the travel industry to optimise the information flowing to intending travellers. The Committee commends the agencies on these initiatives.

The Committee has, however, recommended that the government, in consultation with the travel industry further develop and oversee a code of practice which would, among other things, make it mandatory for travel agents/advisers to provide to overseas travellers, at the time a booking is made, a copy of both DFAT's Travel Advice for the destination concerned and ASIO's threat assessment for the country itself. Travellers must be advised to consult the DFAT Travel Advice 24 hours prior to their departure.

During the inquiry, reference was made to various reports in the press and elsewhere claiming, for example, that relevant information from foreign intelligence agencies had been made available to Australian authorities, and that threat advice had been ignored. These reports and allegations were either simply erroneous or lacked foundation, or were highly contestable opinions.

In relation to the Blick Report, although the Committee did not have access to the classified material that informed the Australian intelligence agencies' assessments at the time, the Committee is in no doubt that there was no specific, actionable intelligence related to the bombings of 12 October 2002. This was the consistent evidence of the intelligence agencies and was the conclusion reached by the statutorily independent Inspector-General of Intelligence and Security, who did have access to all the relevant material. The Committee has no reason to (and does not) call into question Mr Blick's conclusions.

The terms of reference under which the Inspector-General operated did not require him to examine areas such as the formulation and accuracy of threat assessments, and their relationship to, and commensurability with, the travel advisories issued over that period. The Committee does not doubt in any way the professionalism and efficiency of the officials carrying out these duties within their respective agencies. Because the Senate Committee has not had access to the original intelligence, it has not been able to assess for itself whether the published threat assessments were congruent with the intelligence available. As well, given that such an assessment was also outside the terms of reference of the Blick inquiry, there is little the Committee can do to prevail against public criticism that this aspect of ASIO's work has not been subject to independent scrutiny.

This difficulty has not been overcome by the July 2004 report of the Flood inquiry which, by its own account, `did not inquire into ASIO per se because that would not have been justified by the terms of reference. For this reason, domestic security and intelligence arrangements are not the focus of this [Flood] report'.

Again, the Committee can only assess the commensurability of Travel Advice against what were the published threat assessments or what was otherwise revealed publicly to the Committee by the agencies. Nor was the Inspector-General required to make such a judgement. While the Committee is perfectly satisfied that its assessments are justified on the basis of the evidence placed publicly before it, the Committee concedes that this is unlikely to be enough to satisfy those who insist that such assessments are impeded by lack of access to the detail of the intelligence reporting.

As this Report conveys, it is not as though a terrorist action of some kind was entirely unexpected. There was, however, no clear warning in the form of specific intelligence which, if identified and acted upon, would have provided an opportunity to prevent the Bali bombing or to act to protect those there at the time.

Intelligence agencies had reported that Indonesia-based terrorists had the intention and capability to mount attacks against Western interests, and that Australian interests could not be regarded as exempt from such attacks.

In December 2001, from the interrogation of operatives involved in the Singapore bombings, emerged the unequivocal presence in the region of Jemaah Islamiyah (JI) as a terrorist organisation, certainly inspired by and probably with substantial links to al-Qa'ida. Within six months, few people with an interest in regional security were in any doubt that JI cells were active in Indonesia, that the US and its allies, including Australia, had been declared the enemy, and that JI strikes could include `soft targets'.

During 2002, Australian intelligence agencies intensified their efforts to secure better information about the structure, capabilities and intentions of JI and other militant groups. In Australia, ASIO, ONA, DIO and others reported regularly on the progress of their understanding. While there was some variation in these assessments, the overall picture was consolidating rapidly around a high threat level, a domestic security situation in Indonesia that was becoming increasingly violent, and the existence of terrorist groups with both the capacity, resources and intention to target Western interests, both `soft' and `hard'. Australian interests could not be considered exempt.

Meanwhile, tens of thousands of Australian tourists roughly 20,000 per month continued to flock to Bali, the vast majority of them ignorant of the assessed level of threat, with very few of them apparently having consulted the DFAT Travel Advices pertaining to Indonesia, and probably not one of them aware of ASIO's view that the level of threat across Indonesia was `high', and that Bali could not be separated out from that assessment.

The Committee has not had access to classified intelligence material, and has relied on the evidence provided in public by agency officials, and on the publicly-released findings of the Inspector-General of Intelligence and Security (the Blick Report).The Senate Committee's Report attempts to deliver an account of this period which is faithful to the record of activities of Australian agencies as they presented it to the Committee, that is fair to both the intelligence services and to DFAT in its analysis and critique, and which avoids as far as possible the risks of judgements made in hindsight.

This is not to say that there is no wisdom to be found in hindsight otherwise any examination and reflection after the event would be redundant. The Committee scrutinises judgements that were made; it compares and contrasts advice produced by different sources and considers carefully the interpretations and emphases conveyed in that information and advice. The Report presents these in order to assist with an appreciation of how the agencies acted and why, and whether the reasons were sufficient and the decisions robustly grounded. The comments do not imply or infer blame, let alone apportion it.

This Report rehearses at length the sequence of intelligence reporting relating to the terrorist threat in Indonesia in the twelve months leading up to the Bali bombing. In short, the threat was high—officially so from September 2001; Australia's profile as a supporter of US action was growing, and Australia was being increasingly portrayed as anti-Islamic; it was increasingly clear that JI had the intention, capability and resources to mount terrorist attacks including against soft targets and Australians could not be considered exempt.

Other factors were also at play. It became more apparent during 2002 that JI had links with al-Qa'ida, and that Osama bin Laden-inspired jihadism was energising Indonesian militants. The Indonesian authorities were either unable or unwilling to act against them. Indeed, the secular Muslim government was held in almost as much contempt by the radicals as their nemesis the West.

Osama bin Laden had identified Australia as a crusader force and within Indonesia

there had been a surge of militancy against Westerners and their activities especially tourist and recreational activities that had long been regarded as decadent and offensive by Muslim activists. To terrorists like JI, nursing their potent grievances, and looking for suitable soft targets against which to exact their revenge, it is likely, in the view of a majority of the Committee, that Bali (along with other sites) would have been drawn into focus on the terrorists' strategic landscape.

Bali also enjoyed some qualities that distinguished it from other tourist destinations. It was renowned as the tourist destination of choice in Indonesia for Westerners who wanted to let their hair down. It was regarded as a safe holiday destination, with a Balinese (largely Hindu) population that seemed more tolerant or indulgent of Western tourists' mores and behaviour than their Javanese Muslim counterparts.

Westerners gathered in large numbers in the clubs and bars that were concentrated in Kuta, and there was virtually no security presence. The relatively small number of Muslims inhabiting Bali reduced the likelihood of collateral Muslim casualties should a strike be mounted. In the background was a strong sentiment amongst Indonesian radicals, notably Laskar Jihad, that non-Muslim communities should be cleared out of the region.

In the light of all these considerations, the majority of the Committee finds it difficult to agree with the assessment of agency heads that Bali was not any more vulnerable than any other part of Indonesia. It was, in the Committee's majority view, more vulnerable than many if not most parts especially given the fiercely anti-Western, jihad-inspired and self-righteous anger of Indonesia's extremists.

These views about Bali's vulnerability in no way detract from the legitimacy of ASIO's assessed threat level for Indonesia being placed at HIGH from December 2001. The Committee acknowledges that, in the absence of credible, specific information confirming a threat, ASIO could not have issued a threat assessment any higher than the penultimate level at which the assessment already stood. It is not in the `headline' threat assessments, but in the more general intelligence reports about terrorist threats in Indonesia that more consideration should have been given to the question of the vulnerability of Bali, especially given that around 200,000 Australians visited there each year. This might have also resulted in more appropriately crafted Travel Advice.

The Senate Committee has endeavoured to discharge its terms of reference thoroughly, and believes that it has done so to the full extent of the evidence presented to it. The Committee has made every effort to ensure that the relevant government agencies were given every opportunity to place their views and judgements on the public record, and to respond to the array of questions, concerns and allegations that have animated the public debate since Bali.

The Committee is satisfied that important lessons have been learned from the tragic events of Bali, and hopes that this Report will illuminate and extend those lessons.