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Australia's security and intelligence agencies - Reports of the Royal Commission (Justice R.M. Hope), dated December 1984 - Australian Security Intelligence Organization


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The Parliament of the Commonwealth of Australia

ROYAL COMMISSION ON

AUS TRALIA'S SECURITY INTELLIGENCE AGENCIES

Report on the Australian Security Intelligence Organization

December 1984

Presented 22 May 1985 Ordered to be printed 23 May 1985

Parliamentary Paper No. 232/1985

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I J Royal Commission on

, Australia's Security and Intelligence Agencies

)

REPORT ON THE

AU STRALIAN SECURITY INTELLIGENCE ORGANIZATION

December 1984

ROYAL CO~ISSION ON

AUSTRALIA 'S SECURITY AND INTELLIGENCE A.GENCIES

Report on the Australian Security Intelligence Organizat ion

December 1984

Australian Government Publishing Service Canberra 1985

"'

,.

© Commonwealth of Australia 1985

ISBN 0 644 04042 4

Other Reports:

Report on Term of Reference (c)

Report on the Sheraton Hotel incident

General Report

Report on the Australian Secret Intelligence Service

Report on the Defence Signals Directorate

Report on the Office of National Assessments and the

Joint Intelligence Organization

Mr Justice Hope's views on publication of this Report are given in paragraphs 1.15 and 1.16. Publication has involved deletion on national security grounds of Chapters 13 and 14 and Appendix M, and rna ter ial from Chapters 3 to 8, Chapter 15 and Appendix G. There has been minor consequential editing, including of the 1

table of contents and guide to recommendations. Furthermore, Mr II Justice Hope's concurrence has been obtained to the publication of Chapter 12 save for material classified by him on national security grounds. The pages and paragraphs of the published Report have been re-numbered seriatim.

Printed by C.J. Thompson, Commonwealth Government Printer, Canberra

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I

REPORT ON T HE AUSTRALIAN SECURITY AND INTELLIGENCE ORGAN IZA T ION

CONTENTS

Abbreviations Guide to recomm endations

INTRODUCTION

Chapter 1: SCOPE OF INQUIRY

Terms of reference ASIO and its functions Conduct of inquiry Preparation of report

Chapter 2: GENERAL OBSERVATIONS

Changes in ASIO since RCIS Complaints about ASIO Professor Russel Ward Church of Scientology ASIO's public image ASIO now and looking ahead

INTELLIGENCE FUNCTIONS

Chapter 3: ESPIONAGE AND OTHER FOREIGN

INI'ERFERENCE

Security and foreign interference Espionage Active measures of foreign intervention Use of agents of influence Activities of foreign origin

Proposed definition of objectionable foreign interference Reporting to and advising Government Operational performance

(iii)

Page

vii i ix

1

1

2

2

5

6

6

9

11

14

14

24

29

29

30

33

34

39

40

43

44

Para

1.1

1.3

1.5

1 .13

2.1

2.12 2.20 2.30 2.31

2.66

3.1

3.4

3.1 6 3.17 3.34 3.38

3.45 3.47

....

, . . . . ..

Chapter 4: SUBVERSION

Security and subversion Statutory provisions s.5(l) (a) s.S(l) (b) s.5(l) (c) Foreign subversion Recognition of right to dissent Re-arrangement and amendment of definition Sedition ASIO's activities in respect of subversion Targetting procedures Extent of operations

Universities Trade unions

Chapter 5: POLITICALLY MGriVATED VIOLENCE

Security and violence Background to ASIO's role ASIO's present and future role Terrorism

International elements Other politically motivated violence Protection of holders of high office Proposals for changes in definition ASIO's activities in respect of politically

motivated violence Targettin g Operations Threat assessments

ASIO's role in counter-terrorist ar rang emen ts

Page

45

45

51

53

63

65

66

68

69

72

75

76

80

82

84

86

86

88

89

91

92

92

96

102

104

104

107

110

112

COLLECTION AND HANDLING OF INTELLIGENCE

Chapter 6: COLLECTION OF INTELLIGENCE

General considerations Intelligence collection programs Review of targets Human sources Warrant operations Access to other record systems Collection of foreign intelligence in

Australia

( i v)

114

114

115

120

126

129

133

135

Para

4.1

4.29 4.32 4.62 4.70 4.75 4.81 4.85 4.92 4.103 4.104 4.117

4.122 4.130

5.1 5.10 5.15 5.18 5.21 5.23 5.37 5.54 5.57

5.57 5.66 5.76 5.85

6.1

6.8

6.23 6.46 6.55 6.71 6.77

Chapter 7: COLLATION AND RETENTION OF

INTELLIGENCE

General considerations ASIO's record system Criteria for opening files Review of file holdings

Impact of Archives Act on ASIO Impact of Freedom of Information Act Internal processing and dissemination of information

Chapter 8: ASSESSMENT AND COMMUNICATION OF

INI'ELLIGENCE

Assessment of intelligence Hidaka case Authority to communicate intelligence Communication to government agencies

Communication to police forces Communication to foreign liaison services Communication of incidental intelligence

PROTECTIVE SECURITY

Chapter 9: SECURITY CHECKING FOR ACCESS

Clearance system for access Responsibility for issue of c learances Criteria for clearance Allocation of responsibility for checking

ASIO's performance in carrying out assessments Extent of checking Periodic review of security clearances Security checking of members of intelligenc e

agencies Application of vetting

Chapter 10: SECURITY CHECKING FOR ENTRY TO

AUSTRALIA

Non-access checking procedures ASIO's part∑ in the checking system

(v}

Page

139

139

141

141

149

154

157

158

164

164

167

174

178

181

185

186

19 3

193

196

198

202

214

219

224

225

226

228

228

233

Para

7.1

7.8

7.10 7.35 7.55

7.66 7.69

8.1

8.12 8.35 8.47 8.57 8.67

8.73

9.1

9.7

9.14 9.28 9 .65

9.81 9.96 9.98

9.101

10.1 10.20

.,

. .. . '

Chapter 11: REVIEW OF SECURITY ASSESSMENTS

The review system Communication by ASIO of supplementary information Effect of SAT findings

Possible review of departmental decisions on security clearance Security Appeals Tribunal procedures

Chapter 12: PROTECTIVE SECURITY

Introduction ASIO's supportive role ASIO's performance Security audits Physical security

'Leaks' investigations Protective security policy Implications of ASIO's role in protective security

Legislative authority Resource implications Alternative arrangements Conclusions and recommendations

MANAGEMENT RESOURCES

Chapter 13: MANAGEMENT OF ASIO

Chapter 14: PERSONNEL ADMINISTRATION

Chapter 15: FINANCE AND RESOURCES

Funding and staffing Financial administration RCIS and response Legislative framework Conduct of financial affairs Conclusions and recommendations Auditing of ASIO External audit

Internal audit Recruitment of internal auditor Conclusions and recommendations

(vi}

Page

237

237

240

243

246

253

259

259

262

265

269

270

272

273

274

274

275

279

281

285

286

287

287

288

288

288

290

293

294

295

298

301

304

Para

11.1 11.15

11. 30 11.41

11.59

12.1 12.10 12.20 12.29 12.34 12.38 12.42 12.4 5

12.46 12.49 12.61 12.70

15.1

15.4 15.6 15.12 15.23 15.26 15.29 15.41 15.48 15.57

ACCOUNT ABILITY

Chapter 16: CONTROL AND ACCOUNTABILITY

Introduction Director-General Attorney-General's role ASIO and the Prime Minister

Minister's power of direction Section 8 ( 2) (a) and (b) Section 8(2) (c) Attorney-General's guidelines Minister's access to information Minister's knowledge of ASIO Departmental support for Attorney-General

New office of Inspector-General

Chapter 17: EXTERNAL ACCOUNTABILITY AND

REDRESS

Parliamentary oversight Leader of the Opposition Consideration of case for a parliamentary committee

Auditor-General Judicial review Accountability to the public Redress mechanisms

APPENDIXES:

A

B

c

D

E

F

G

H

I

J

K

L

M

Letters Patent Submissions at public hearings Spiegel v. Now~ Magazine Subversion

ASIO Guidelines for Coverage of Mass Issues Reporting on civil disorders and demonstrations involving a federal

interest ASIO's record holdings Form of agreement between the Commonwealth and certain States and

the Northern Territory Outline of overseas checking prac~ic~s Non-access security checking s~at~st1cs Security Appeals Tribunal .statlStlCS

Law and practice in re1at1on to review of security assessments (Deleted)

(vii)

Page

306

306

308

309

309

310

314

316

321

322

323

325

328

336

336

338

341

346

346

347

349

Para

16.1 16.3 16.17 16.20 16.22

16. 30 16.37 16.51 16.54 16.59 16.63

16.76

17.1 17.13 17.22

17.36 17.37 17.42 17.47

..

AFP

AOPM APS

AS IO

ASIS

CPA CS IS

DHC DIEA DSD DSO FBI

IDC ICP

IPSG J IO

KGB

NCDC NI SC ONA OSCAR PAM PSA PSB PSCC PSM PSR RCIS SAC-PAV

SAM

SM

SC EC

SCIS SIDC-PAV

SIRC SMOS USSR

LIST OF ABBREVIATIONS

Australian Federal Police Administrative Officers Procedures Manual Australian Public Service Australian Security Intelligence Organization Australian Secret Intelligence Service Communist Party of Australia Canadian Security Intelligence Service Department of Housing and Construction Department of Immigration and Ethnic Affairs Defence Signals Directorate Departmental Security Officer Federal Bureau of Investigation

inter-departmental committee intelligence collection program Inter-departmental Protective Security Group Joint Intelligence Organization Komitet Gosudarstvennoy Bezopasnosti (State Securit y Committee of the USSR)

National Capital Development Commission National and International Security Committee Office of National Assessments Office of Special Clearances and Records Personnel Assessment Manual Public Service Act Public Service Board Protective Services Co-ordination Centre Protective Security Manual Protective Security Review Royal Commission on Intelligence and Security Standing Advisory Committee on Commonwealth/State Co-operation for Protection Against Violence Security Assessment Manual Security Appeals Tribunal Security Construction Equipment Committee Secretaries Committee on Intelligence and Security Special Interdepartmental Committee on Protectio n Against Violence Security Intelligence Review Committee Department of the Special Minister of State Union of Soviet Socialist Republics

(viii)

GUIDE TO RECOMMENDATIONS

Recommendations which I have made in this report are referred to below. The purpose of listing is to provide a convenient point of reference to the recommendations. The references are not intended to act as a substitute for the terms of those

recommendations as they appear in context in the main body of the report .

Subject of recommendation

Scope of inquiry

Publication of report

Espionage and other foreign interference

Amendment of ASIO Act

Subversion

Amendment of ASIO Act

Amendment of Crimes Act 1914 Regulation and rev1ew of investigations

Politically motivated violence Amendment of the ASIO Act

Communication of information relevant to VIP protection Guidelines on collection of intelligence for VIP protection

Resource allocation Guidelines on targetting procedures Guidelines on agent operations Consultation about information related

to legal proceedings

Collection of intelligence

Changes in intelligence collection programs Review of need for progress report~ .

. . . . . d 1∑nvest1gat1ons Gu1del1nes on 1nqu1r1es an . Guidelines on aspects of agent operatlons

( i X)

Para.

1.16

3.44

4.91 4.102 4.116

5.54 & 5. 55 (a) 5.55(b)

5.55(c)

5.62 5.65 5 .75(a) 5.75(b)

6.18 6.19 6.45 6.54

i "

Subject of recommendation

Procedures for handling of intercepted material Issue of warrants for 12 months in certain circumstances

Arrangements for access to other records systems

Amendment of ASIO Act for collection of foreign intelligence

Inter-agency arrangements on foreign intelligence collection

Collation and retention of intelligence

Review of information procedures and systems Revised procedures for opening and maintenance of files

Revised policies for culling and destruction of files

Arrangements with Australian Archives

Application of Archives legislation

Need for care in placing any Archives records in public access

Processing and flow of intercept material from regional offices to head office

Measures to assure veracity of, and facilitate reference to, file contents

Assessment and communication of intelligence

Approach to preparation of assessments Checking of assessments Training in report writing Communication of intelligence to

other countries

(X)

Para.

6.59 6.70

6.76

6.84

6.87

7.7

7.34

7.54

7.65

7.65(b)

7.65(c)

7.80(a)

7.80(b)

8.34(a) 8. 34 (b) 8.34(c) 8.38

Subject of recommendation

ASIO and AFP to consider secondments Question of ASIO/police agreements between N.S.W. and Victoria

Authorisat .ion of officers to communicate intelligence Liaison with police forces Possible secondments to AFP Guidelines on provision of intelligence

about Australians to foreign services

Amendment of ASIO Act : communication of incidental intelligence

Security checking for access

Consultation in regard to security clearance process

Criteria for clearance Responsibility for security checking Arrangements within the Defence Department Timing of ASIO assessments

ASIO's administration of its security checking responsibilities 'Positive vetting " Revision of the Personnel Assessment Manual Some requirements for security checking

Scope of positive vetting

Periodic review of security clearances Security checking of members of the intelligence agencies Number of Top Secret clearances Review of national security classification

procedures

Security checking for entry to Australia

Criteria and procedures relating to . security checking for entry to Australla

Review of security assessments

ASIO's role in the review process Effect of SAT findings Ombudsman's role

(Xi)

Para.

8.65 8.66

8.72{a)

8.72(b) 8.72(c) 8.72(d)

8.89

9.13

9.27 9.61 9.62 9.76 9.80 9.91 9.92 9.93 9.94 9.95 9.97

9.99

9.103 9.104

10.19

11.29 11.40 11.58

&

I

Subject of recommendation

SAT procedures Dissemination of SAT findings Expenses of successful applicants Reference of questions of law to

the Federal Court Procedures for applicants SAT and the deportation of immigrants

Protective security

Responsibility for protective security policy and co-ordination

High level protective security committee SMOS to be responsible for protective security Agencies responsible for protective security Possible amendment of ASIO Act: recognition of

protective security function

Finance and resources

Legislative cover of financial administration Financial and administrative functions Finalisation of outstanding action Financial instructions Amendment of Audit Act 1901 Auditor-General's Office to second internal

auditor Director-General to review internal audit program Internal audit report to Inspector-General Control and accountability

Appointment of Director-General Director-General to approach Prime Minister Minister's power of direction Attorney-General's guidelines Record of ministerial access Departmental support for Attorney-General Office of Inspector-General

External accountability and redress

Tabling of annual report Public acknowledgement of identities of senior officers Amendment of ASIO Act: s.65(1)

Extension of right of appeal to SAT SAT to test information SAT role advisory Inspector-General to inquire into complaints

(xii)

Para.

11.66 11.69 11.71 11.73

11.75 11.77

12.73

12.77 12.78 12.79 12.80

15.25 15.25 15.25 15.25 15.59 15.59

15.59 15.59

16.16 16.21 16.46 16.52 16.58 16.75 16.102

17.12 17.46

17.56 17.58 17.59 17.60 17.69

CHAPTER 1

SCOPE OF INQUIRY

Terms of reference 1.1 The Royal Commiss1'on was t bl' h d b es a 1s e y Letters Patent issued by His Excellency the Governor-General on 17 May 1983 to undertake a judicial review of the activities of Australia's security and intelligence agencies. The Letters Patent which provide the terms of reference are reproduced at Appendix A.

1.2 So far as the Australian Security Intelligence Organization ( 'ASIO' or 'the Organization') is concerned, the Letters Patent required me, among other things, to inquire into the activities of the Organization (especially since the completion of the Royal Commission on Intelligence and Security (RCIS)) with particular reference to:

the progress made in implementing Governmen t decisions on the recommendations of RCIS; whether ASIO has efficiently, effectivel y and properly served the interests of the Australian people and Government; whether any changes in law or practice are called for to ensure it is properly accountable and to provide for proper safekeeping of intelligence; whether there is adequate

for any per sons who may be

its actions;

provision for unjustifiably effective redress disadvantaged by

whether existing law enables effective oversight by the Auditor-General of the Organization in financial matters; whether the activities of the Organization have been carried out in compliance with the law.

ASIO and its functions

1. 3 ASIO is

organisation. the Commonwealth's It has a staff in

1.

domestic security the order of 700, intelligence the largest

group of whom work at the Head Office and others in regional offices in the capital cities of Australia. ASIO's expenditure for 1983/84 was $27.176m while the budget estimate for 1984/85 is $32. 749m (additional provision has been made elsewhere in the budget in connection with the planned move to Canberra). Its role

is confined by the legislation under which it operates to the collection, evaluation and communication of intelligence relevant to the protection of Australia and its people from a number of specified activities, including espionage and other acts of foreign interference, subversion and terrorism.

1.4 ASIO is not a police force. It has no powers to interrogate, detain or arrest people or to carry out or enforce other measures designed to thwart the activities with which it is concerned. Its job is confined to informing and advising government, including police authorities, in relation to those activities. ASIO's advisory function includes the provision of protective security advice to government departments and agencies and the furnishing to them of security assessments on people requiring clearance for access to security information or areas, or on foreigners seeking to enter or remain in Australia.

Conduct of inquiry 1.5 The nature of the matters to be inquired into was such that the greater part of the Commission's work had to be conducted in private and much of the information obtained could not be publicly disclosed. The Commission did seek, by notices published

in the national, metropolitan and ethnic press during 1983, submissions from members of the public about any matter within the terms of reference.

1.6 The Commission received about 75 submissions concerning ASIO from members of the public, private groups and a State

Government. Of these, approximately 50 complained of harassment or other illegal or improper activity on the part of the Organization. The remainder of the submissions suggested ways in

2.

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I

, I

which ASIO's operations and t' ∑ ∑ ac 1v1t1es might be made more effective, accountable or in the public interest.

1.7 Following consideration of these submissions , I agreed that a number of individuals and groups could make oral submissions at

sittings of the Commission which were held in Sydney, Melbourne, Adelaide and Canberra. The sittings were held in public except in cases where considerations of security or personal privac y dictated otherwise. A list of people and groups who made

submissions at public hearings is at Appendix B. on the Commission " s handling of complaints about 2.29).

I report below ASIO (2.12 to

1.8 ASIO was invited soon after the establishment of the Commission to make submissions on matters relevan t to the terms of reference and to indicate action taken to implement Government decisions on the recommendations of RCIS and the Protective Security Review affecting ASIO (see terms of reference, para.

(a) (i)). Following consultation with the Commission, ASIO settled on 19 subjects on which it prepared formal submissions for me. ASIO also provided me with written answers to questions, and

provided a good deal of additional material, during the course of the inquiry.

1. 9 I conducted extensive discussions with and questioning of

ASIO staff at all levels, supplemented by examination of files,

reports and other material and inspection of ASIO premises. I spent a number of days making on-the-spot inquiries at ASIO's Head Office, and Commission staff carried out inquiries there

over several months. I also visited the re9ional offices in New South Wales, Victoria, South Australia and the Australian Capital Territory and my staff conducted further inquiries in those Western Australia and Tasmania. In off ices and in Queensland,

numbe r of ASIO staff members made

addition, a considerable

e inquiries into written or oral submissions. I was able to pursu issues of interest in overseas countries.

3.

...

..

1.10 I received submissions from and discussions were had with a number of Commonwealth departments and agencies concernin g

their dealings with ASIO and related matters. With the agreement of State and Territory Governments, discussions were held w ith State police forces, together in some cases with S tate Government officials, on police relations with ASIO. I also had discussions with the Australian Federal Police. I discussed aspects of ASIO with the Attorney-General, with the Shadow Attorney-General (a former Attorney-General) and with the former Director-General of Security, Mr Justice Woodward.

1.11 The Director-General of Security and his staff co-operat ed throughout in meeting requests for information and in otherwise facilitating the conduct of the inquiry. I did find a tendency on the part of some officers to respond to questions in a narrow way, but formed the view that this stemmed from habit rather than any intention to obstruct, and I adjusted my questions accordingly. ASIO's own submissions, and the contributions of individual members of its staff, were of considerable assistance. I was also helped very much by submissions or assistance received from members of the public, private groups, agencies and individuals within the Government and people with whom I had discussions overseas.

1.12 In accordance with the terms of reference, I concentrated my inquiries on the activities of ASIO since RCIS. In a number

of instances, particularly in investigating complaints, I examined files .or considered matters going back beyond the date of the RCIS Report. But my general approach was that I should not pursue matters earlier than that Report unless it appeared that they had not been addressed by RCIS or that there was good reason for further inquiry.

Preparation of report 1.13 I have had to be selective in addressing issues in this report, concentrating on those that I regard as especiall y important and others on which I feel there may be something of

4.

particular use that I can say. I came across, or had drawn to my attention, included other issues in the course of the inquiry. These

issues of concern to particular of personnel ASIO employees, for and example in regard to aspects administration,

issues of wider import. Some were matters of a kind that can really only be worked out within ASIO's system of management. I did pursue some inquiry into many of these matters and some of them helped to form my perceptions on broader issues.

1.14 A draft of the report was made available to the manag ement of ASIO for comment with a view to ensuring, in particular, that it accurately and fa1"rly represented matters discussed in it.

1.15 The report has been prepared in the expectation that the Government will wish to publish as much as possible o f those parts that deal with matters of general public interest. I consider that a large part of the report could be published.

1.16 After consultation with ASIO, I have identified particular passages which contain material which should be classified on national security grounds. Material so identified could be excised if the Government decides to publish the report. Apart from material which in itself should be protected, consideration should also be given to the overall effect of publication of a considerable amount of detail about the workings of ASIO. A distinction should I believe be drawn between those parts of the report which deal with activities of ASIO which can have an

impact upon, and are of concern to, members of the public, and other parts, which deal with internal matters. I see Chapters 12, 13 and 14 and part of Chapter 15 (computerisation, technical resources and deployment of staff overseas) as in the latter category. Publication of details of ASIO's internal

h t ths an

d weaknesses, could

organisation, revealing bot s reng harm the effectiveness of ASIO and in that way risk damage to

Australia's security.

5.

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CHAPTER 2

GENERAL OBSERVATIONS

Changes in ASIO since RCIS 2.1 Considerable changes have been made to ASIO, or carried out within ASIO, since RCIS. In good part those changes have been in accordance with RCIS recommendations. In some cases I believe ASIO could have acted earlier,

recommendations for internal change. or with more energy, on

2. 2 RCIS reported on ASIO in late 1976 and, in October 1977, the then Government announced acceptance of most of the

Commission's recommendations including proposed amendments to the ASIO Act. In the event, a new Act, the Australian Security Intelligence Organization Act 1979 (ASIO Act) was enacted to replace the 1956 Act. The major features of the new Act, which came into force in June 1980, were:

a clear statement of ASIO's functions and their limitation

by reference to the concept of 'security' as defined;

the prohibition of ASIO' s use of certain intrusive methods of intelligence collection except under ministerial warrant (the Telecommunications (Interception) Act 1979 is also relevant in this respect);

the creation of a new statutory framework for the

preparation and communication by ASIO of security

assessments on individuals, and the provision to most people affected by prejudicial assessments of a right of appeal to an independent tribunal presided over by a judge.

2. 3 Mr Justice Woodward, OBE, then a judge of the Australian Industrial Court and of the Supreme Court of the Australian Capital Territory, was appointed Director-General of ASIO in

6.

March 1976. He remained ∑ th t f

1n a o fice until September 1981 and

was succeeded by his Deputy, and the present Director-General,

Mr T .H. Barnett.

2. 4 ASIO' s funding has 1∑ ncrea d ∑ 1 se 1n rea terms since the RCIS. Its expenditure grew from $7.8m in 1976/77 to $27.l76m in 19 8 3/84 (and an appropriation of $3 2. 7 49m for 19 84/85) " In real terms there has been an increase of 122% over this period. This represents a significant increase in resources. Staff numbers have increased by 42% between 1 July 1977 and 1 July 1984.

During the period ASIO ∑ d "t ∑ , 1mprove 1 s recru 1 tment processes and attracted large numbers of young graduates for whom it devised a 'generalist intelligence officer' career program, involving training and experience throughout the Organization. This recruitment process has given ASIO staffing a noticeable 'new look'.

2.5 Efforts have been made to revamp ASIO's personnel policies and procedures as recommended by RCIS. A Personnel Branch was established in 1976 to take responsibility (previously dispersed throughout the Organization) for policy on conditions of service, recruitment manpower planning. subsequently became a career and salaries

and training, establishment control and Administration of staff entitlements Personnel Branch responsibility. A new structure for ASIO staff, differing

significantly from that applicable in the Commonwealth Public Service, was introduced in 1978. Negotiations on a new set of employment terms and conditions for ASIO staff were commenced but have not yet been brought to fruition.

2. 6 There have been two major organisational changes in ASIO since RCIS. Establishment of the Personnel Branch was the first. The second was the amalgamation in 1977 of Head Office research and operational functions through the creation of three new

branches, two of which have responsibility for intelligence collection and analysis in defined target areas, with the third providing operational support services. With this reorganisation

7.

came a new process for directing ASIO's intelligence collection efforts, centred on annual 'intelligence collection programs' which identify information requirements in target areas.

2.7 Following the RCIS recommendation that ASIO's Head Office should move to Canberra, construction of a new building

commenced there in February 1981 and planning is underway for the move.

2.8 ASIO was also affected to some extent by the implementation in 1979 and 1980 of recommendations of the Protective Security Review (PSR). PSR recommended, and the then Government accepted, that ASIO should be made solely responsible for producing national assessments in respect of politically motivated violence; also, that ASIO assessments should be made available to relevant State police who have the primary responsibility for protective measures. This is done.

2. 9 To

between facilitate and regulate the exchange of information ASIO and State police, PSR recommended and the

Government accepted that agreements covering such exchange be entered into between the governments of the Commonwealth and of the States and the Northern Territory. Agreements are now in force, except in relation to New South Wales and Victoria.

2.10 PSR emphasised ASIO' s role in advising on departmental protective security where national security is involved. Consequent upon critic isms made by PSR of departmental

arrangements for protective security, including in respect of training and support for departmental security officers, ASIO was given a broader role as the central point of reference for departments in protective security matters.

2.11 References are made throughout this report to particular recommendations of RCIS or PSR and, as is required by my terms of reference, to action on them.

8.

Complaints about ASIO 2.12 The Commission received approximately 50 letters and submissions from individuals and organisations alleging that ASIO has been involved in illegal or improper activities. It has

been all eged that AS IO has carried out physical surveillance, tel ephone tapping, mail interception, covert photography and used listening devices 1.n circumstances where such activities

were not just'fied. It has been claimed that ASIO has made

information, including false information, available to unauthoris ed individuals and organisations, and has maligned, harassed, disparaged and unfairly treated individuals.

2.13 The Commission followed up the allegations other than those to which it could not give credence and even then checked on some of those. The following are examples of the type of

allegation which I decided should not be investigated or investigated further following preliminary inquiries:

ASIO and a State police force ran an operation in a suburban

street concerning a person said to have died of bullet wounds and, in order to preserve the appearance of

normality, used memory suppressive drugs on people in the neighbourhood, the drugs being administered in milk;

an allegation by a person in a hospital under ASIO infra -red micro cameras;

that he was still

ASIO officers sprayed the complainant with acid water

Powder On h 1

∑m from the ceiling of his flat;

threw sneezing

and

the mercury detoxification of the staff of a ASIO prevented k local church; tertiary education institution and too over a persons on the

agencies 'can be or rays from some

't and intelligence black list of securl Y ∑ and are harassed with laser beams or beams other kind of electronic equipment'; 9.

'∑. I "

ASIO's surveillance devices were located in the fill ings of the complainant's teeth.

2.14 A number of the people making allegations were

interviewed; some presented oral evidence at formal hearings. Particular allegations were followed up by:

requesting ASIO to state, in writing, what interest, if any, it had in particular individuals;

checking the Personal Index in ASIO Head Office and then checking any relevant files revealed by it;

calling for and examining particular files in Head Office and regional offices; and

calling for and reading relevant RCIS files.

2.15 Most of the submissions received contained allegations of ASIO harassment of particular individuals. Of the 36 name s

submitted to the Commission in this context:

in seven cases the allegations were considered so implausible as to be not worth pursuing at all;

in two cases interviews were conducted before it was decided that the allegations did not merit further investigation;

in nine cases the person allegedly the subject of harassment was not known to ASIO and in a further four cases was know n only through representations to the Organization by or on behalf of him or herself~

in fourteen cases individuals were recorded in the Organization's files. However, security nature was not held

10.

adverse information of a on all of these persons.

(Individuals about whom ASIO holds files may not be

adversely recorded in security terms 7 13 7 4 - see " - .1 ) .

2 .16 The Commission saw no evidence that ASIO had harassed any

o f the fourteen individuals recorded in its files. However, I

consider that ASIO' s handling of one case indicated poor

judgment by an ASIO officer, in that an individual was

inte.rviewed without sufficient inquiries being made beforehand:

inquiries would almost certainly have indicated that an interview was not warranted or desirable.

2.17 One of the cases concerned the then Member for Fraser in

the House of Representatives, Mr Ken Fry, who made a written

submission and appeared at a public sitting. I made inquiries and am satisfied that Mr Fry was never a target of ASIO

surveillance or telephone interception.

2.18 I should point out that people outside ASIO claiming to have access to ASIO files or to be able to use 'security

connections' to 'fix people up', may be lying and in fact have no connection with ASIO at all. I suspect that this is usually

the case.

2.19 In fifteen cases it was alleged that ASIO was involved in or improper activity other than harassment of illegal individuals, or had made serious errors in its handling of particular matters. In six cases the matters raised were not pursued either because insufficient information was provided to permit inquiries to be undertaken or because the allegations were not considered to be credible. In the nine cases which were

investigated the commission was unable to substantiate charges of illegal or improper behaviour. As to errors made by ASIO in

the H idaka case~. see Chapter 8 "

Professor Russel ward 2. 20 One of the complainants, Professor before a public sitting of the Commission

11.

Russel Ward, appeared on 2 April 1984. He

outlined his political views and the activities in which he has participated and referred to his membership of the Commun ist Party in the 1940s. He claimed that he had been 'spied upon and harassed' for most of his life. In particular, he said that security authorities had:

compiled a dossier on him;

intercepted his telephone;

placed him under physical surveillance at Mosman in the 1940s, at Armidale in the late 1950s and again in the 1970s;

provided a report on him which resulted in him being

dismissed from a position as lecturer at Wagga Teachers College;

provided information to Professor Baxter which resulted in him not being permitted to take up a position as a lecturer in history at the University of NSW in 1956.

2.21 I examined Professor Ward's case carefully and, because of the publicity surrounding his evidence, have decided that it would be appropriate to report on my findings.

2. 22 ASIO holds a significant amount of material on Professor Ward. While a little information, including information pre-dating ASIO's formation, was already held, it appears that significant ASIO interest in him was only aroused in 1952 when

it was given information about his 'political affiliations'. Some basic inquiries were conducted which indicated he had had

communist sympathies.

2.23 In October 1953 ASIO submitted to the Prime Minister a brief background summary of information held on certain members of the Australian National University, including Ward who was at that time a student. This was done in the context of

12.

conversat1 ' ons between th h e t en Director-General and the Prime Minister and corr d f espon ence rom the Director-General to the Prime Minister seek1' t b ∑ ng o o ta1n approval for the establishment o f a system of security checki_ng by ASIO of proposed appointees

to certain departments of the University.

2.24 Throughout the 1950s information was added to the ASIO file on Ward. Th1's 1'nform t' d d' a 1on concerne War s associations with certain persons and organisations, and information publicly available, was obtained by

apart from ASIO in the

course of watching, not ward, but those persons and

organisations.

2.25 In 1955, as a result of a Commonwealth Literary Fund

lecture by Ward, ASIO decided, after some hesitation, that the Prime Minister's Department should be advised orally of his security background. This action may have been taken pursuant to an instruction from the Prime Minister in 1952 that ASIO

investigate all persons put forward for Commonwealth Literary Fund fellowships.

2.26 In December 1960 the press carried allegat ions that Ward had been unsuccessful in his application for a position at the University of New South Wales in 1956 and had been prevented from taking up an appointment at the Wagga Teachers Training College in 1951 because of adverse security reports.

2.27 The allegations prompted ASIO to investigate, in December 1960 and January 1961, its actions in respect of Ward. It was concluded that ASIO had not supplied security information about ward to either institution. My inquiries have not revealed

anything that would contradict that conclusion.

2.28 Some further material was added to the ward file in the 1960s and the 1970s, but not ward by AS IO. The file has

years, apart from a further

as a resul t of any surveillance of been inactive now for quite a few internal review of ASIO' s earlier

13.

actions in respect of Ward after he appeared before this Royal Commission in April of this year.

2.29 It is important to note that where material on the file was produced as a result of ASIO surveillance, it was

surveillance directed at other parties, not at Ward. The file also contains material, concerning Ward, received from other security authorities. ASIO denied that Ward was ever the subject of surveillance or that it had ever intercepted his telephone. I found nothing to indicate that these denials were untrue.

Church of Scientology 2.30 I was aware, as a result of High Court proceedings a few years ago and publicity they attracted, that the Church of Scientology had alleged improper action by ASIO in relation to that group (Church of Scientology v. Woodward and others (1982) 43 ALR587). Although no complaint was made to the Commission, I investigated the matter. I found that ASIO had informed itself in the past about scientology by collecting available information and that it made inquiries of overseas sources. It did not conduct any form of surveillance. ASIO notified relevant authorities that the group was not of security interest for the purposes of the Act.

ASIO's public image 2.31 It is difficult to form a true picture of the way in which ASIO is generally regarded by Australians. Many people approve

of the Organization and its activities, regarding it as an arm of Australia's defence. Some people do not think about it at all. There are sections of the media, some politicians and persons engaged in political activities and some other citizens who dislike it with varying degrees of intensity and who either

criticise or lampoon it. My inquiries suggest that, despite this media attitude to ASIO and the significance that some people in public life may give to it, that attitude may be a minority one,

and the minority may not be very large.

14.

2.32 across I can

limited

Apart from hearing or reading the views of people from whole sections of Australian society, factors upon which place some reliance to judge the position include the number and the content of submissions made to the

present Royal Commission, and to RCIS, the number and nature of letters published in newspapers about ASIO and its activities, and parliamentary debates on ASIO and ASIO legislation. Only two organisations, the NSW Council for Civil Liberties and the Communist Party of Australia (CPA) , submitted that ASIO ought to be disbanded. (The CPA proposed that certain functions be given

to the police). Also, in making a complaint about ASIO

surveillance, one individual said that ASIO should be disbanded.

2.33 Whatever the overall attitude of the community to ASIO and its activities may be, there is no doubt that ASIO is viewed critically in some quarters. The fact that the activities of a public authority are unpopular or are criticised by some

significant part of the community does not of course mean that those activities should not be carried on. Different parts of the community take objection to the activities of many Commonwealth authorities, but that is no reason for any of those

authorities not to carry out their statutory responsibilities.

2.34 It does mean however that those responsible for the functions and activities of the public authority should try to determine the reasons for the critic ism, and consider whether any of its activities should be reviewed and, if necessary, altered because some at least of the grounds of criticism may be

justified.

2.35 The criticism of ASIO and its activities takes many forms. ∑ 1 grounds and some on pragmatic

Some is based on ideolog~ca

grounds; some criticism is reasoned, some is emotional. Many of Of the cold war and product the critics regard ASIO improperly based upon a as a

dogmatic belief that Australia is

inevitably drawn into the confrontation between Soviet bloc countries and must support the West.

15.

the West and the

2.36 Some regard the Organization as a conspiracy of the political right against the political left, even though it was founded by the Labor Government under the Prime Ministership of Mr. Chifley. Much of the criticism is based on activities of the

Organization before RCIS including its activity in relation to the defection and revelations of Mr and Mrs Petrov, and in relation to the war in Vietnam and demonstrations and other political activities associated with opposition to that war.

2.37 Some criticism is based on a belief of improper intrusion by ASIO into proper political activities, trade union activities

and activities of popular 'single-issue' movements. Some is based on an understandable confusion between activities by ASIO and activities by the various police forces. Some is based on a misreporting or a biased reporting of ASIO's activities. Some is based on a belief or assumption of clumsiness or inefficiency on ASIO' s part.

2.38 Notwithstanding the qualifications which have to be placed on much criticism of ASIO activities, there can be no doubt that

there is some criticism which is either justified, or in which there is some degree of substance. Before I go to this

criticism, I must say that almost all criticism which I have heard or read and which purports to be based on activities of ASIO relates, even if the allegations are true, to a small part

only of the Organization's activities.

2.39 When there is a commission of inquiry into the activities of any organisation, and particularly an orga~isation such as ASIO, much of the inquiry and of any ensuing report tends to be directed not to what the organisation does professionally, with propriety and with in its charter, but to problems and failings that might be discovered, and how they may be answered or

overcome. Likewise, it is not common to see an article or program in the written or electronic media devoted to praising an organisation like ASIO. These approaches leave a one-sided view of the Organization and its activities.

16.

2.40 its

It is necessary for ASIO, and for anyone responsible for activities, to understand the sources of the criticism and to try to form some informed judgment on its validity or

relevance. There is some criticism about which ASIO can and should do nothing. It is not for it to justify the existence of a security organisation, any more than police should justify the

existence of a police force or a Taxation Commissioner should justify the existence of a Taxation Office.

2.41 However, if criticism of some particular activity of ASIO has validity and relevance, ASIO should consider what (if anything) should be done about it. Here ASIO strikes one of its most persistent problems, for although it can describe its activities in general terms, it is not generally possible, whether for reasons of security or privacy or otherwise, for it publicly to give chapter and verse to justi fy criticised

activities.

2.42 There are some matters which can be discussed in general terms without creating security, privacy or other such problems. It is clear that what gives rise to much, if not most, of the criticism of ASIO is its activities, or its assumed activities,

in the area of subversion. It is in this area that it is often thought that its activities intrude improperly or unnecessaril y into proper political activity or upon privacy; and it is also an area which gives rise as often to fantasy as to fact.

2. 4 3 Many

telephones are surveilled by

organisations and tapped by ASIO or

ASIO. No amount

people belie ve that their that they are being physically of investigation will satisfy that their

not under

these organisations and people, where it is the case, telephones are not intercepted and that they are surveillance. From the point of view of public perception it is, to no small extent, irrelevant wh at the truth is, for the truth can rarely be publicly examined and established. This is a fact

that ASIO and those responsible for it must face, and which they ∑ h th r any steps should be

must take into account in dec id1ng w e e

17.

taken to try to answer or to diminish critic ism derived from beliefs of this kind.

2.44 ASIO must thus accept the fact that no amount of propriet y on its part will remove much of the criticism in∑ the area of subversion. What it must do is to satisfy itself as to the propriety and professionalism of its activities, and as to their relevance to the protection of the Commonwealth which is entrusted to it. What those with responsibility for ASIO can do

is to devise methods by which, as far as practicable, the public

can be satisfied that ASIO complies with the standards required of it .

2. 45 ASIO' s propriety and professionalism are discussed later in this report. Its standard of propriety in the carrying out of its statutory functions is generally good and often high. Overall, its professional ism is reasonably good, but could be

better in some areas. In some limited areas its professionalism has at times been bad and must be improved. In some areas its professionalism is high.

2. 46 Some lack of necessary standards appeared in some of the evidence made public in the hearings in respect of paragraph (c) of the terms of reference the Ivanov-Combe affair. That evidence disclosed mistakes in facts reported to the Director-General, the Prime Minister, and the National and International Security Committee of Cabinet, a negligent and erroneous identification of a person assumed to be present at a breakfast meeting and phonetical and spelling mistakes in the transcriptions of intercepted telephone calls.

2.47 The phonetical and spelling mistakes were criticised in the media, sometimes in reports which themselves were replete with similar mistakes. It was a long while before some parts of the press were able to spell Mr. Combe's name correctly. No doubt the media mistakes were explicable because of the pressure under which the reports were produced. The ASIO records, which

18.

we re

were the

copies of made under

identities

the original full or consider able pressure of people referred to

epitomised and some

were not

transcriptions, at a time when

known to those

doing the transcribing.

2.48 It would of course be better if these mistakes, including the phonetical mistakes, could be avoided, but this is by no me ans e::1sy to achieve. Records of the transcription of taped

court or commission proceedings regularly contain mistakes of this kind, even though the transcr ibers have extremely high standards. Another basis of criticism, that the original transcriptions should have been tidied up and corrected for presentation to the Commission, may, if this crit icism had been

foreseen and met, have involved an inappropriate, if not improper, alteration of the evidence which ASIO was required to produce.

2. 4 9 The mistaken reporting of facts was a serious matter and requires steps to be taken to ensure, as far as possible, that this does not happen in the future. It may be that perfection is not attainable but within the scope of financial and other resources improvement is possible and steps should be taken to attempt to achieve it. Likewise the wrong identi fication at the breakfast meeting was negligent and unprofessiona l, and ASIO' s practices should ensure that such mistakes do not happen. These matters are dealt with later in this report.

2.50 steps Beyond which

ensuring could be

propriety taken to

and profession alism there are satisfy the public on these

matters. tt S later 1.

. n my review of

I discuss some of these rna er

mechanisms to ensure an appropriate

oversigh t of ASIO 's is the making public at least of ASIO 's

activities. One of information step which could be taken about the extent of some activities. Thus, I do not think that there is any security

from the Public a general knowledge of reason for withholding the extent of the activity undertaken by ASIO for the purposes of subversive studies of the kind described in Chapter 4.

19.

. .

2.51 One area of criticism, or perhaps of fear, in respect of ASIO' s actions in the area of subversion is that it intru des

into the activities of institutions such as trade unions and universities without any, or any sufficient, justificatio n. ASIO's activities in areas such as these are discussed 1n Chapter 4, and it will be seen that the criticism or fear is now

not justified.

2.52 At least since 1979, ASIO has been particularly sensiti ve about being involved in trade unions and universities, and indeed views have been expressed that the Organization has been over-sensitive. It is said that if an investigation of a matter by ASIO is justified, it should not stop short or hesitat e because of a policy against intrusion into the activities of one of these institutions, if the adequate investigation of the particular matter calls for that intrusion. I discuss the nature and extent of these activities in Chapter 4.

2. 53 Although the extent of ASIO' s activity in the subversion area is limited, it can have a significance for the protection of the Commonwealth. As it happens the subversive threat is singularly low at present; in the future it may remain at the same level, decrease further, or become greater. Even with the low extent of the present threat, ASIO's activities in the subversive area enable it to monitor foreign intrusions into the Australian political scene against Australia's interests, and to monitor bodies which are fomenting violence as part of longer

term subversive objectives.

2.54 Another area that has given rise to some disquiet is what is thought to be the relationship between ASIO and the

Australian Federal Police and State and Territorial police forces. The relationship between ASIO and the State and Northern Territory police forces is now regulated by written

inter-governmental agreements save in respect of New South Wales and Victoria.

20.

2.55 My inquiries indicate that, where agreements do exist, the exchange of intelligence between ASIO and the police forces is in accordance with the terms of the agreements and conforms with requirements of propriety. The same is true of propriety in respect of the two also in relation

States to the

where there Australian are no agreements, Federal Police.

and

What

intelligence is exchanged relates almost entirely to terrorism and to information relevant to the protection of international or Australian holders of high office.

2.56 There is little public criticism of ASIO in relation to its counter-espionage activities, save in relation to the question of effectiveness. Although the media commonly reported evidence given to the Commission in respect of the Ivanov-Combe affair in a way critical of ASIO, that criticism, whether

justified or not, did not suggest that ASIO should not have investigated Mr. Ivanov in order to discover whether he was a KGB agent, and having discovered that he was, should not have

investigated what he was doing with Mr. Combe. There was a

little, but in my opinion unjustified, critic ism of ASIO for having reported to the Government upon the matter. Mistakes made in the course of that reporting were properly criticised.

2.57 A matter which was the subject of much criticism was the cutting off of access by Mr. Combe to ministers. That was not the subject of any recommendation by ASIO, but was action taken by the Government. ASIO learnt about the decision some days

after it was taken. What criticism there is of ASIO in its counter-espionage activities, apart from that going to effectiveness, is really criticism of government policy, and is not something for which ASIO is answerable.

2 . 58 No c r i tic ism is d i r e c ted a g a ins t AS I 0 in r e 1 at ion t 0 its

activities in the area of terrorism, again save criticism as to effectiveness. It is difficult to imagine justified criticism of ASIO for becoming involved in this area, for it is a real

although fortunately as yet a limited problem for Australia and

21.

. -∑

..

ASIO has unique access to much intelligence which is vi tal to

attempts to combat terrorism.

2. 59 Apart from intelligence collection ASIO' s principal activity is the making of security assessments in respect of individuals for access or other purposes. Much of the crit icism previously directed to it in relation to these assessments has been answered by the institution of a system of review.

Critic ism has been made of procedural aspects of these reviews but they are regulated by the ASIO Act and not, save to a very limited extent, by ASIO. There are however a number of problems in the security checking system which are discussed in Chapter 9 and which require some solution to make the system more

effective and fair.

2.60 This review of the criticism of ASIO would suggest that, apart from ideological views, it stems mainly from two sources -a lack of public awareness of what it is that ASIO does, and

mistakes or negligence on the part of ASIO in the carrying out of its functions. The remedy for the mistakes and negligence is largely, although not wholly, in ASIO's hands. Limitation of resources necessarily places some limit on what ASIO can do by way of training and monitoring its own activities. Nonetheless

there are undoubtedly steps which it can take to minimise inefficiency.

2.61 ASIO's ability to remedy the problem of a lack of public knowledge of its activities is limited, but there are some steps which it can take. Steps can also be taken to provide a syste m which should result in a greater public satisfaction that ASIO

is acting with propriety.

2.62 Among the steps which could be taken are ones directed to rebutting false and harmful allegations about ASIO in the me dia. I referred above (2.37) to misreporting and biased reporting about ASIO. Misreporting can be accidental, or in any event not malicious. Biased reporting can be based on honestly held

22.

! I

beliefs, or on a view (right or wrong) f o what the public want to hear. ASIO's standing is ∑ 1 1 1∑ s1ngu ar y 1able to be damaged by these forms of reporting because of its inability to reply, and in particular to reply by giving the facts, but in the ordinary

case this is a problem with which it has to liv e .

2.63 Some reporting about ASIO is however so inaccurate and so damaging that it falls a long way outside these descriptions.

One wa y in wh ich some of this report ing could be dealt with is

by the Minister answering selectively the grosser charges. A

similar problem would arise if an alle gati on of misconduct against ASIO were true. I discuss this matter in the General Re port, and conclude that notwithstanding the harm that baseless

charges do to ASIO and its officers, the traditional course of

making no comment should be adhered to, except in special

circumstances. It is only in this way that the interests of the nation, which outweigh more particular public interests and the

interests of ASIO, can be maintained.

2.64 A problem about many answers by the Minister, if he chose to make them, and particularly if he made them in defence of AS IO, is that often he can answer only on the bas is of what he

has been told by ASIO. If

Inspector-General are accepted, my recommendations about another and possibly

an

more

effective measure would be for this office r to investigate allegations of this kind and, as well as reporti ng on them to the Attorney-General, include his general findin gs in his annual sui table and credible means of report. This would provide a helping the public to obtain a true picture of ASIO and of its activities.

2.65 More generally, in regard to AS IO's h istorical background, Intelligence/Security

I mention that a history o f Australi an Services 1900-1950 was prepare d for RCIS by a is already published material on this subject, could be given to publication of the whole o r

of that work.

23.

consultant. There but consideration appropriate parts

ASIO now and looking ahead

2. 66 The ASIO that I have reviewed is very different from the ASIO that I got to know during RCIS. It has broken away from the

rather unthinking pursuit of old targets, and the laxity of standards that characterised the Organization then. AS IO as it operates now under the present Act is more focussed in it s activities and much more conscious of the sensitiv ities pertaining to, and the proper limits of, its activities.

2.67 While, as indicated later in this report, I consider that ASIO has not been as rigorous as it should have been in

reviewing targets in certain areas, and has not followed through as it should have in carrying out certain requirements of the ASIO Act in its internal procedures, I am satisfied that AS IO

has in its operations in all significant respects kept within the limits of the Act and otherwise within the law. In

particular, I did not come across any evidence of the use by ASIO of unlawful methods of collecting intelligence whether in

regard to the special powers requiring the Attorney-General's warrant or otherwise.

2.68 ASIO's staff generally speaking are not characterised by the rather fixed mind-set that was apparent among many staff at the time of RCIS. There has been a large infusion of new, better qualified staff and the staff now appears to be mo re

representative of the Australian community than it was before.

More than half of the staff have served in the Organization for

less than 5 years.

2.69 As with most if not all organisations of any size, ASIO has staff varying in quality from mediocre to very good. My overall impression is of men and women, often relatively young, who are able, intelligent and committed to their work.

2.70 I believe that many of the critics of the Organization who are wont to caricature its employees would be struck first by the 'ordinariness' of most staff, in the sense that they are the

24.

k ind of Australians one commonly meets working in other

o rganisations in th bl" e pu 1c or private sector. The only "difference' is that they are working for ASIO. The same critics

m ight be su.rprised too at the nature of discussion and debate

that goes on among staff within the Organization about what they

are doing or should be doing. There appears to be no lack of

adherence to or respect for liberal-democratic values.

2.71 My overall view is that ASIO has properly served the interests of the A t 1 ∑ 1 us ra 1an peop e and Government in recent years and that it has done so with a fair degree of

effectiveness. I refer throughout this report to a number of

significant areas where I believe there is room for improved

effectiveness and efficiency.

2 .72 In particular, I note the

arrangements

and for the

for the establishment need for

of policies more and

co-ordination of ASIO's activities. I

effective priorities also make

recommendations and suggest ions for changes in the law and for

changes in administrative practices to improve the control, oversight and accountability of the Organization. I recommend a more limited role for ASIO in some of its present protective security functions, partly so as to enable it to focus more on

its security intelligence role.

2. 7 3 The terms of reference do not expressly require me to consider Australia's continuing need for a security intelligence organisation like ASIO. This question was addressed in RCIS (4:1-104). It will be apparent from what I say below, and I here

state, that I still see a need for ASIO. I remain of the view that the proper fields for investigation by ASIO should be carefully defined in the legislation and I recommend some refinement and tightening up of present definitions.

2. 7 4 The case for AS IO rests essentially on the need, which I regard as plain, for Australia to be able to protect itself and its people against espionage and other forms of foreign

25.

. ∑. . :'

interference, ends. ASIO's terrorism function is

and

to

domestic violence inform itself of for political any dangers o r

emerging dangers in these areas, and to alert the Government to them as appropriate. Other functions, such as those on the

protective security side, would have to be undertaken elsewhere if they were not undertaken by ASIC. (I suggest in this report that some parts of these functions be transferred out of AS IO).

2.75 ASIO's security intelligence functions, and particular ly those concerning terrorism and political violence, could conceivably be committed to a Commonwealth police organisati on and at a future stage of the development of the Australian Federal Police this option may be more feasible than it appears

to be now. But from the viewpoint of the liberty of the subject, it is far from clear to me that such a change would bring about any lessening of the concerns that are attendant upon the carrying out of the functions. Indeed, a police force charged with such functions could more readily become the kind of secret or political police force that ASIO is, inaccurately, described as being by some critics.

2.76 I have given thought to the option of winding-up ASIO and making a fresh start with a new body charged with similar

functions. Such a change might at least be a means of laying to rest some of the ghosts from ASIO's past. And, _in some respects, particularly on the management and internal organisation side, I must say that I would have liked to have found more progress within ASIO since RCIS.

2. 77 My firm conclusion, however, is that this option is not warranted and would be unjustifiably disruptive. ASIO has gone through a considerable process of evolution in recent years and I believe that it is capable of further positive development. Its task is an uncommonly difficult one and it makes more sense to build on the experience of the Organization, and its staff, than to throw all that away and start again. A contin ued commitment to ASIO does not rule out a change in its name, but

26.

the present name describes accurately the Organization's functions, and I d t o no propose any change.

2. 78 Looking ahead,

report, for quite a I do see a need, as I indicate in this

number of cha ∑ h nges 1n t e legislation and e con ro an oversight of ASIO and in other arrangements for th t 1 d its internal management and procedures.

2.79 1nce ou grown t e 'family' The Organization has long s ∑ t h style of organisation, under strong personal leadership, that marked its early years. It is now a medium-sized organisation e c anges 1n management but is still coming to terms w1∑ th th h ∑

style and procedures, at all levels, that this requires. After RCIS ASIO made a start in recognising and facing up to some of

the demands facing it and the way it ran. In recent times it has made a further attempt to face up to those problems.

2.80 ASIO faces a very great challenge in the period ahead in responding to the need for organisational changes as well as to changes that may be imposed on it, whether as a result of this report or otherwise, in coping with the Head Office move to Canberra and at the same time effectively discharging its

important functions. It is a challenge that will demand the very best of the many members of the present staff who are committed to ASIO and concerned to see it operating as well as possible, as well as offering opportunities for new staff.

2.81 One matter about which care will need to be taken is that the growth in the 'bureaucratisation' of the Organization is not at the expense of its intelligence collecting capacity. There are signs already of growing imbalance between the intelligence collection function and administrative support functions, with

t t the growth in

marked growth in the latter. To some ex en

managerial and administrative support staff is simply a product of the growth in ASIO' s size. It is a reflection too of the demands of accountability and control procedures to which ASIO is subject, and to the administrative demands of other external

27.

requirements such as those stemming from the applicatio n of the Archives Act 1983 to ASIO.

2 .82 It will behove ASIO's management to keep the Organization as trim as possible, and to ensure that the resources devoted to its primary functions are not neglected. There will be no point in having a large, well equipped organisation, capable of

efficiently assessing and communicating security int elligence, if it is not capable of collecting the right kind of

intelligence.

2.83 Concerns of this kind are turned around by some critics into arguments that moves to regulate ASIO and make it more accountable will strangle it with legalism and render it ineffective. It is possible that ASIO could be subjected to restrictions and requirements so oppressive or inappropriate as to bring this about. It is a danger of which I am very

conscious. I do not believe that the system under which ASIO now operates, or the system as it will be if recommendations I make are adopted, will have this effect.

2.84 I am firm in the view that- effectiveness and

accountability are not incompatible in a body like ASIO. Great care is required, however, in striking the right balance in imposing requirements on the body. And those charged with carrying out and directing its work have to be capable of meeting the challenge, including the challenge of instill ing understanding of and respect for the limits on activity whil e

inculcating initiative and eschewing excessive caution.

28.

CHAP TER 3

ESPIONAG E AND OTH ER FOREIGN INTERF ERENCE

SECURITY AND FOREIGN INTE RF ERE NC E

3 .1 ASIO 's functi ons and powers under the ASI O Act hinge

o f security as defined in s.4. That

c lasses of activity, the protection of

from which constitutes security for the

largely on the concept provision describes five

Au str alia and its people purposes of the Act. Two of the specified activities,

'espionage' and 'active measures of foreign intervention', are diffe rent forms of attack carried out by, or for , foreign pow ers

or foreign polit ical organisatio ns. Also, the definition in s.5 of 'subvers ion' - which is one of the other activiti es specified in the definition of 'security' distinguishes 'acti vit ies of

fore ign origin' from domestic subversion. The other two, sabotage and terror ism, organised, supported or may have a domestic origin, or may be

influenced by or on behalf of some

foreign power or foreign political organisation.

3.2 In this chapter I deal with the activities comprehended by the references in the definition of 'security' to 'espionage', 'active measures of foreign intervent ion' and indirectly to 'activit ies of foreign origin'. I do this not only because they

have the same external origin, but because, in practice , the carrying out of these activities may run together, or be organised by the same intelligence or other agents acting for a foreign power or foreign political organisation.

3. 3 There

is, I believe, a large measure of acceptance of the 1 . about espionage or other

need for intel 1gence foreign powe rs in

Australian Government's clandestine affairs. ASIO's functions in these areas are close to the heart of the reason for its existence.

interference by

29.

. .

Espionage 3. 4 The nature of espionage, its occurrence in Australia and the need for Australia to take steps to protect itself against espionage were discussed in general terms in RCIS (4:1, 38-41). I adhere to and will not repeat what was said there, although it

will be necessary to bring some parts of what was said there up to date. It was said in the RCIS report that espionage is spying, and quoting from the report of the Royal Commission on Espionage (the Petrov Commission) it was pointed out that, whilst espionage had been, in former years, connected mainly with military aims and objects, the position has now so changed that 'no part of the machinery of government or of the

organization of civil life, can be regarded - even in times of peace-as exempt from its attentions'.

3.5 Spying can be carried on for many purposes. Classical espionage was primarily used to discover the actual or potential enemy's military and political plans and capacity. The subject of this type of espionage is now much enlarged, but nonetheless

it is undertaken for national or quasi-national purposes, that is, by or on behalf of one foreign power or foreign political organisation against another country or its government. (I include the expression 'foreign political organisation' as well as " foreign power' - as does s. 5 { 2) of the ASIO Act - because

there are foreign political organisations which represent people hostile to the recognised government of the country where they live, or of the country which they have left, or which have been established by a power, generally outside the territory of that power, to carry out the wishes of that power in other countries.)

3.6 Another form of espionage is what may be called industricl espionage, when an industrial corporation or other entity tries to find out the scientific or technological secrets of a rival, whether operating in the same or another country, for the purpose of improving its position in the world or local market, that is, for monetary gain, unrelated to any national

consideration.

30.

3.7 It is to the first of these two forms of espionage (and there are no doubt other forms but it is not necessary to consider them here) that the definition of 'security' l.S primarily directed. However there is no simple line of division

between these two types of espionage. The immense and contin~ing advances of science and technology are so great and so important

across whole areas of human activity, including military activity , that industrial secrets can have an importance far beyond the mak ing of a monetary gain. What may appear to be only an act of industrial espionage may, in fact, be an act of

national espionage as well.

3. 8 One power may wish to steal

technologica l knowledge or skill available the

to

scientific another power and

to

promote its defensively. own capacity to wage war, whether offensive ly or It may want to obtain the same information to

maintain or to advance its own economy, including its economic capacity to wage an offensive or defensive war. It may want to obtain it for other reasons designed to promote its own interests against the interests of other powers. Clandestine attempts designed to break restrictions on what is often called

'technology transfer' are becoming an important aspect of national espionage.

3.9 The secrets held in Australia which could be the subject of espionage can take many forms, as can the means of their

acquisition by spies. The clandestine or deceptive acquisition by a person of any of these secrets for the benefit of a foreign

power or foreign political organisation falls within the scope

aga1 ∑nst which ASIO has a duty to protect

of the word 'espionage' the Commonwealth.

3.10 The

'Espionage section as concept of

sidenote to s. 78 of the Crimes Act 1914

and similar activities '. The matters specified in

is:

the

the

the Offence are narrower than constituting espionage that I have described. They relate to certain activities 1

∑ntended to be prejudicial to

'for a purpose

31.

..

'I

the safety or defence of Queen's dominions'. The other matters, including

the Commonwealth or of part of Act contains provisions directed the disclosure of information

the

to

by

Commonwealth officers prohibited places (s. (s. 70), official secrets (s. 79) and 80) " I do not propose to discuss those provisions here, save to say that they describe activities other

than those described in s. 78 which would, if done for the benefit of a foreign power, constitute espionage as that word is used in the definition of 'security'. (A discussion of these sections is to be found in RCIS 4:2 App. 4-F).

3.11 The language of s. 78 is derived from the older concept of espionage which related it only to the physical safety of Australia. I have no doubt that there are many matters which are not so related, or certainly not so related directly, which would constitute espionage for ASIO' s purposes. The essential components of espionage for ASIO's purposes are that there should be a clandestine or deceptive obtaining of intelligence by or for the benefit of a foreign power or foreign political organisation, when the provision of that intelligence to that power or political organisation is detrimental to the nationa l

interests of Australia. This includes, but is not limited to, the handing over of any classified document or a copy of such a document, or information as to its contents. The intelligence will normally be secret, or at least not readily available to the foreign power or political organisation.

3.12 The precise nature of the espionage against which Australia needs to be protected may vary from time to time. I do not think that any good purpose would be served by attempting to formulate a legislative definition of the proscribed activity. If ASIO were in doubt about the propriety of its investigation of some particular activity as a form of espionage, the appropriate course would be for the Director-General to consult the Attorney-General.

3 2.

3.13 A function which is closely connected to counter-esp ionage is counter-intelligence . Th is is the expression used to describe ac tivities which are concerned to identify, study or penetrate

hostile o r potentially hostile intell igence services. It comprehends

succeeding seek to

action take n

in the specifi c d isting uish

to prevent those services activ ity between of espionage. I will

counter-espionage

from not

and

counter-intell igence 1n this Report if only because, for ASI0 1 s purposes, they substantially merge.

3.14 E spionage ma y be carried out by professio nal intelligence officers employed by a foreign power or foreign political

organisati on, or it ma y be carried out by persons who have

established themselves in the Au stralian commun ity in a way that does not associate them or their activities with a foreign power

or foreign political organisation. These people are referred to as 1 illegals' in intelligence terms. Most intell igence offi cers enter Australia as members of foreign diplomatic, consular, trade or other official missions in this country.

3.15 It is important for Australia to retain, and, if possible, enhance ASIO's capability of protecting it from e sp ionage.

Active measures of foreign interventio n 3.16 ∑ ∑ t t ∑ n

1

as used in the 'Active measures of fore1gn 1n erven 10 , definition of 'security' in s. defined in that section to mean taken by or on behalf of a

interests of that power'. These in RCIS ( 4 : 1 1 42-54). Reference

4 of the AS IO Act, is itself

'clandestine or deceptive action foreign power to promote the

active measures were considered was made to activities by 'an

unfriendly power

∑ fl e or subvert the

clandestinely to ln uenc

policies of another power, to take a variety of other

to feed it with false information, or clandestine or decepti ve actions to 42). Among the forms

weaken it or confuse its people' ( 4: I' . k hich were there discussed were

which foreign 1nfluence may ta e w l 'nfluence and disinformat ion and deceptive the use of agents of Clandestine or deceptive action were information. Other forms of also discussed.

33.

Use of agents of influence 3.17 Some controversy has surrounded the concept of agents of influence. It was pointed out in RCIS (4:1, 47} that a person is not to be regarded as an agent of influence merely because he does or says things, publicly or privately, favourable to a particular foreign power, or because he has been persuaded to do so by the available material about that power. It was said that clandestinity of persuasion was the hallmark of this type of activity. Clandestinity is no doubt a hallmark, but what is crucial for the discharge of ASIO's function of seeking to protect Australia against illicit foreign interference, is that

the alleged agent of influence is being operated by the intelligence service of a foreign power for the benefit of that power and against the interests of Australia.

3 .18 The real point at issue, and ASIO' s primary interest, is

the activity of the foreign power, that is, the taking by it or those representing it of clandestine or deceptive action to interfere in Australian affairs. Conduct of that kind on the part of a foreign power is objectionable. A government is entitled to look to a security service for information about any such foreign interference. If informed of such conduct, it may take various measures including expulsion of any foreign government representative involved, generating publicity to counter the effect of the interference, or warning or advising any Australian citizen who may be involved.

3.19 If an Australian citizen is being operated by an

intelligence officer, then whatever the citizen's state of mind may be, it is ASIO's duty to monitor the operation with a view

to enabling the Government to forestall its success. The effectiveness of the intelligence officer may be neutralised in a number of ways, including warning or advice to the Australian

citizen. In some cases it may be appropriate for ASIO to let the matter develop, giving due warning to the Government. In other cases it may be appropriate to put an end to the operation by having the intelligence officer expelled forthwith.

34.

3.20 The state of mind of a person who is the subject of an

operation by a foreign intelligence service consideration. Such a person will generally be is a

witting; secondary he will

know and appreciate what 1s h ∑ appen1ng, and assent to being the subject of the operation. consciously that person will himself become suspect from a security point of v iew.

will If so,

3. 21 However, there may the person being operated ma y be persuaded by a

without knowing him to

not always be knowing involvement by or used by the foreign powe r. A person representative of a foreign power be an intelligence officer of the

justice of a foreign country's cause and, so persuaded, agree to a request to try to influence the Austral ian Government or

public opinion in completely unaware the foreign that he

power's is being

interests. used by

He

a

may be

foreign

intelligence service, although he may find it hard to sustain a claim of innocence if he continues to accede to such requests and does not reveal to the Government or to the public the fact

that they have been made. If such a person is, in fact,

simply

unwitting because he he should not be regarded is being used to further

as a security risk the purposes o f a foreign

power. The activity of the foreign power will nevertheless

remain a matter of security interest.

3. 22 An interesting addition to the 1 i terature on agents 0

f

influence is a copy of an advertisement, set out in Appendix C , that appeared in the London 'Times' of 9 October 1984 ∑ The magazine 'Der Spiegel' sued Party membe r of Parliament) own ers and publishers of the German Sir James Go ldsmith (a Conservative and the publisher of an English magazine

'Now' in defamation in

to impute that Der As appears from the

respect of an allegation that was claimed Spiegel was under the control of the KGB∑ after action was withdrawn

counsel for the

the

not

advertisement, the defendants made in court the

statement,

advertisement, that the publishers witting, agents of the KGB.

35.

were

set out in

unwitting , and

3.23 ASIO's present working definition of 'an agent of influence' is:

an asset of some status who wittingly or unwittingly utilises his position to influence public opinion or decision making to produce a result beneficial to the country whose intelligence service operates him.

This working definition is consistent with the present statuto ry

definition of 'active measures of foreign intervention' for it is directed to activity producing a result beneficial to the

foreign country as opposed to activity producing a result detrimental to the interests of Australia. I conclude below (3.38-3.43) that the latter rather than the former is the proper test, although, in practice, either test may produce the same result in particular cases.

3.24 The word 'status' is a word of uncertain content, but presumably it is intended to refer to a person who is in a position to exercise influence. If that is what it means, I have no quarrel with it. The critical word in the working definition

is 'operates' " The definition does not describe the evidence which should be looked for in order to assess whether a foreign intelligence service is 'operating', or is seeking to 'operate', the person of influence. The nature of this evidence and the tests to be applied in deciding whether there is an 'operation' are critical, even though it is unlikely that there could be any exhaustive statement of them.

3.25 In my view, however, the definition would be more useful if it focussed on the foreign power, or representative of the foreign power, who is operating the agent of influence, rather than on the agent who is being operated. As I have indicated, it is important not to lose sight of the fact that it is the foreign power's interference in domestic affairs which gives rise to the basic objection and threat to security.

36.

3.26 It has been submitted b th . Y e Australian Labor Party that the 'agent of 1nfluence' justification for ASIO surveillance and adverse security assessment should have no application where the iCOnduct giving rise to concern clearly occurs 'unwittingly', and

should not war rant ASIO' s at tent ion ∑that this class of conduct 1unless it :

{a) is deliberately engaged ∑ t d 1n so as o a vance the interests of a foreign power;

(b) is engaged in at the request or on the instruct ions of that

power or some person acting on its behalf;

(c) is part of a course of similar conduct, or in some other way

is such that the person of influence can reasonably be said to be 'operated' by the foreign power; and

(d) is in some way clandestine or deceptive.

3 .27 It is not clear to me precisely what is mean t by this

5ubmission, but I have taken it to involve two propositions :

(a) there is no justification for ASIO surveil lance and adverse security assessment in although he might properly be respect of a person who,

regarded as an agent of

influence, clearly acts unwittingly; and

(b) no agent of influence, whether witting or not, should 1 th four C

onditions

attract ASIO's attention un ess e specified in the submission are satisfied.

it 3 .28 Whether this view of the submission is correct or not, seems to me to be too general, particularly in relation to the

suggested condition (c). Subject to my qualificat ion to that

ondition, which I explain below, I generally agree with the submission so far as it relates to any adverse assessment of the

Security risk. It does not uspected agent of influence as a

3 7.

follow, as I explain below, that the relationship of such a person with the foreign agent should not come under ASI O

surveillance.

3.29 If it is established that a person is acting clandesti nely or deceptively at the request or instruction of a foreign power or its agent for the deliberate purpose of advancing the interests of that foreign power in a way affecting the interests of Australia, that person is undoubtedly a witting agent of

influence. I assume that the clandestinity or deception involves at least a secret request or instruction by the foreign powe r or its agent, and that the Australian citizen does not disclo se that request or instruction. The existence of the request or instruction may be established in a number of ways. It may be established by direct evidence of conversations or dealings relating to only one operation. If it is to be established by inference, a knowledge of the facts concerning more than one operation may be required, but it cannot be stated categorically that this must be so. Even if a person has acted wittingly as an agent of influence for a foreign power on only one occasion, he has still been 'operated by the foreign power'.

3.30 If it is not established, by direct evidence or otherwise, that a person deliberately engaging in the advancement of the interests of a foreign power is acting at the request or on the instructions of that foreign power or its agent, it wou ld probably be necessary to show some course of conduct to

establish that the Australian citizen was being 'operated' by the foreign power. This need would not go to the fact of that operation; it would go to the proof of it. The foreign power or its agent may indeed be 'operating' the Australian citizen for

its purposes on one occasion only, or on the first of a number of occasions, however innocent the Australian citizen might be.

38.

3 .31 Also, the conditions suggested in the submission (3.26) appear to be directed primarily at the ∑ t ∑ f pos1 1on o the person b eing (or suspected of being) operated as an agent of influence

rather than at the action of the foreign power or foreign

intelligence officer on behalf of the foreign power. ASIO's duty

is to detect and forewarn the Australian Government of the

c landestine or deceptive actions of foreign powers or agencies.

I t has a duty to investigate any case where it is suspected that

a person has been operated by a foreign power as an agent of

influence, or, indeed, where it is suspected that a foreign

p ow er is actively trying to cultivate a person in order that he

m ight a.ct as an agent of influence for it. Thus, if a person, knowingly being 'operated' by a foreign agent, persuades another

innocent person to use his influence for the benefit of the

foreign power, the innocent person's unwitting involvement

should not derogate from ASIO' s obligation to investigate the

matter, even though the second person was blameless.

3 .32 The unwitting involvement of a person in an operation by

o r on behalf of a foreign power should not, by itself, result in

a ny adverse security opinion or assessment about him.

3 .33 Indeed, k n forel

∑gn intelligenc e any contact between a now

agent and an Australian citizen may justify an inquir y or

l ∑ the course of that investigation by ASIO of what took P ace 1n contact, although, of itself, the mere fact of the contact would

not justify any active surveillance of the Australian citizen by

A SIO.

Activities of foreign origin

∑ ∑ " is defined

∑3.34 The expression 'activities of foreign orJ.gln '

, in s. 5(2) of the ASIO Act to mean:

subsidized by' or undertaken . in

activities of, directed or foreign power or fore~gn active collaboration with, a ∑ d on or to be carr1ed

political organization, whether c~rrle on in Australia or outside Australla.

39.

This definition the activities is directed to subversion, and s.5(1) so defined from the concept of

excludes dom estic

subversion. Section 5(3) provides that nothing in s.S affec ts the meaning of 'subversion' in relation to activities of foreign origin. In other words, in that context resort can be had to the ordinary, undefined meaning of the word.

3.35 'Activities of foreign origin' as appropriate description of the kind of foreign defined is involvement

an

in

activities in Australia which justifies investigation by ASIO if the activities are otherwise such that a foreign involvement makes them appropriate subjects of interest for a security organisation.

3.36 As discussed in chapter 4, the difficulty with this approach is the lack of precision in the notion of subversion. In practice, ASIO has tended in this area to focus on the 'foreign origins' of actiNities at the expense of assessing whether the activities are in fact subversiv~, considered

independently of the foreign involvement in them.

3.37 It would be preferable in my view to spell out more

clearly the kind of activity which, if of foreign origin, constitutes a threat to the security of Australia. The existing definitions of 'activities of foreign measures of foreign intervention' could purpose and merged in a new definition.

origin' be drawn

and 'active

on for this

Proposed definition of objectionable foreign interference 3. 38 The establishment or support by a foreign power of an organisa tion in Australia to promote its interests does not necessarily involve an 'active measure of foreign intervention' . Many foreign powers openly establish or support such

organisations. They commonly promote cultural, trading and other ties, and seek to achieve other quite proper objectives. The interests of the foreign power may be promoted, but there is no objectionable interference with the interests of Australia. The

40.

promotion of the interests of a foreign power may detrimentally affect some interest of Austral1' a, but ∑ f 11 1 a aspects of that promotion are carried on openly, 1∑ t '11 t f Wl no o itself give rise to a matter of security concern. It is a comb ination of clandestinity or deception with the effect of the activity on

the interests of Australia that gives rise to a security concern.

3.39 Whether the promotion of particular interests of a foreign power is detrimental to the interests of Australia may often be

clear, but in other cases may be a matter of fine balance. In some cases security concern can arise without a decision being

made as to detriment. There are cases, overlapping with

espionage, of may be said

interference for intelligence purposes. that the detriment speaks for itself. There it

In other

instances the foreign power, clandestinely o r deceptively, intrudes into the political or governmental processes of Aus tralia, as by promoting or supporting a politica l party, or

seeking to influence government decisions or policy making. These are matters which, assuming clandestin ity or deception, are every bit as objectionable as espionage. Such an intrusion involves at the very least an affront to Australia n sovereignty

and independence.

3.40 Activity by a foreign power which involves threat s to any in Australia is always a matter of securit y concern, person whether or not it occurs clandestinely or deceptively. These threats can occur here, particularly in relation to migrants. There is a clear interest in the government having intel ligence

and it should be part of ASIO's about any activity of this kind, function to collect it.

3.41 The definition of 'threats s.2 of the Canadian Security and such a threat:

to the security of Canada " Intel ligence Act includes in

as

Wl . thin or relating to Cdanadrea

foreign influenced activities c da an a ∑ terests of ana that are detrimental to t~e 1n threat to any person. clandestine or deceptive or 1nvo1ve a 41.

3.42 The security agencies of most if not all powers

investigate such activities.

3.43 There are

foreign origin, thus four classes of activity which, if of should attract investigation by ASIO. They are, first, clandestine or deceptive activities which are conducted for purposes detrimental to the interests of Australia. The latter part of this description is to be compared with the present definition of 'active measures of foreign intervention' which refers to activities to promote the interests of a foreign power. As has been shown, such an activity is not necessarily a matter of security concern, although it may need investigation by ASIO to see what its true purpose and ramifications are.

Secondly, there is foreign clandestine or deceptive intrusion into the political or governmental processes of Australia. Of its nature, activity of that kind can be regarded as detrimental to the interests of Australia. Foreign clandestine or deceptive intelligence activity, the third activity, can likewise be regarded, in itself, as detrimental to the interests of Australia. The fourth activity is threats to persons in Australia, whether or not clandestine or deceptive.

3.44 I accordingly recommend that:

(a) s. 4 of the ASIO Act should be amended to include a

reference to 'acts of foreign interference' in place of the present reference to 'active measures of foreign

intervention' in the definition of 'security';

(b) 'acts of foreign interference' should be defined to mean:

Activities, within or relating to Australia, taken by, for or on behalf of a foreign power or a foreign political organisation, that are:

(a) clandestine or deceptive and conducted:

{i) for intelligence purposes, or (ii) to affect political or governmental processes, or

42.

(iii) otherwise to the detriment of the interests of Australia; or

(b) involve a threat to any person.

For the purposes of this provision activities taken by, for or on behalf of a foreign power or a foreign political

organisat ion include activities that are directed or subsidized by, or undertaken in active collaboration with, such a power or political organisation;

(c) the definition of 'activities of foreign origin' as defined

in s.5(2) of the ASIO Act be omitted, on the basis that such activities no longer be dealt with as a particular form of 'subversion'.

_Reporting to and advising Government

3.45 ASIO normally provides the Government with a biennial 'Threat Assessment specifying the nature and extent of the threat

to security arising from espionage activity as well as from other sources. (The last such Assessment was produced in 1981). Its annual report is another vehicle by which ASIO can, and does, report to the Attorney-General on the extent of any such

threat.

3.46 Some criticism was expressed during the evidence on Term of Reference (c) that ASIO should have reported the activities

of Mr Ivanov to the Government - to the Attorney-Genera l if the

Prime Minister was not available long before it did so.

Although there may have been difficulties, such as those arising from the election campaign, I think there is substance in this

criticism. The Prime Minister, the Attorney-General and other be kept aware of any serious Ministers as appropriate should security case from an early stage. Fol lowing the Report on the

Ivanov affair, the Director-General ∑consultations with the Prime Minister

of Security agreed in and the Attorney-General

that he would i~form them progressivelY and from an earl y stage

of developing espionage cases.

43.

Operational performance

3.47 While the Ivanov case illustrated the Organization's inadequacies in some respects, it also illustrated its success in carrying out one of the important functions given to it by the Parliament. Although criticism continued day after day to be

mounted in the med ia, over the Ivanov/Combe affair, much, if not most, of that criticism was directed at matters entirely extraneous to ASIO, such as the denial by the Government to Mr Combe of access to Ministers or procedural decisions made by

Although it is to be regretted that the mistakes which me .

' the

evidence revealed were made, ASIO's real achievements in respect of Ivanov should not be underrated.

44.

SECURITY AND SUBVERSION 4.1 Subversion appears that ASIO what it is intelligence role.

CHAPTER 4

SUBVERSION

to

is

loom large concerned in the

with popular in its

view of

security

4.2 It is also arguably the most controversial aspect of ASIO's statutory charter.

4. 3 While ASIO' s stud f b ∑ ∑ ∑ Y o su vers1.ve act1v1.ties accounts in fact for a relatively limited amount of its security intelligence effort - less than it did in the period before RCIS - ASIO's statutory role in this area, and the way it is carried

out, calls for close scrutiny.

4.4 The controversy about the desirability of a government taking steps to protect itself against subversion flows essentially from the inexactness of the concept. To some people that inexactness encourages an political activity and creates a

improper intrus ion into lawful risk to the political freedom

which it should be ASIO's function to protect. At one end of the spectrum of subversive activities lies revolutionary violence to overthrow the constitutional government; activit y at the other end of the spectrum merges into political activit y which is

entirely proper within a democratic society.

4.5 I would doubt however that many people would think that a constitutional and democratic government is not entitled to take steps to protect itself against an imminent unconstitutional and violent overthrow. More commo nly the differences of opinion which I have found to exist about subversion concern the nature

and seriousness of the threat or risk which would justify the government taking protective action, rather than whether there

4 5.

is any need to protect a constitutional government against subversion of any kind at all.

4.6 The word 'subversion' is not the name of any specific

common law offence; nor is it to be found in the various

c riminal codes in Australia. Use of the word, with its broad connotations, may contribute to misunderstanding of the more limited meaning given to it in the ASIO Act.

4 .7 The concept of subversion and various definitions or

descriptions of it were discussed in RCIS (4:2, 73 et seq).

4.8 Those definitions included the NATO definition of subversion:

Action designed to undermine:

(a) The political, economic, psychological, political strength of a nation, and (b) The loyalty of the subjects.

morale, or

Activities of that general kind should be a matter of concern to c itizens, groups and governments who have a responsibility for

or commitment to the health and stability of a society and a

nation.

4.9 The way in which such activities are countered, whether by addressing the underlying causes of dissatisfaction or by exposing the weakness or falsity of the thinking behind the activit ies, is a measure of the health of a society and its system of government.

4.10 However, in the absence of a violent element, or a foreign element, it is not appropriate that activities of such a broad scope should be the subject of study by a security intelligence service in a free society, under a democratic system of government, such as we have in Australia. The security service would in essence be concerned with dis sent and the danger is that its role could become one of keeping the government of the

46.

day informed of the activities and thinking of those whos e are different from the government's. views

4.11 The

directed position is very to the overthrow different with activitie s that are

by unconstitutional means of a

constitutionally established government, and in overthrow of such a government by viole nce. particul ar the The definition s

referred to in RCIS were generally concerned with subversion in this sense.

4.12 Sometimes the definition of subversion includes lesser acts such as, for example, the use of violence or unlawful or criminal acts to undermine or to destabilise a constitutional government. Conduct of that kind may be engaged in without

reference to the overthrow of the government but more often as something that is done as a step towards that overthrow and, in particular, with the aim of creating a situation in which that overthrow may realistically be contemplated and carrie d into effect. The relationship between the present acts or intentio ns

d b t

Uous Or it may be an the future acts or results may e en , reasonably close.

4.13 The question in the present context is not wha t is the ∑ 't' of a kind that

meaning of subversion but rather what act1v1 1es, may be regarded as subversive, are properly committed to a body assessment and reportin g to such as ASIO for investigation,

government.

4.14 The views expressed by

of

the

the

Commission of Inquiry Royal Canadian Mounted

Concerning Police are Certain Activities an example of what

found to be the more I have h Commission stat ed:

general approach to this question. T e Information, without that, in our opinion, 'securit y of Canada':

In our First Report on Security and attempting to be exhaustive, we s~at:~e there were two concepts involved 1n the terri tory of our

The first is the need to preserve t ∑ s the need to

attack. The second concep 1 country from

47.

preserve and maintain the democratic processes of government. Any at tempt to subvert t∑ hose processes by violent means is a threat to the security of Canada.

Fundamental to both these definitions are pure basic needs: first, the need to protect Canadians and their governments against attempts by foreign powers to use coerciv e or clandestine means to advance their own interests in Canada, and second, the need to protect the essential elements of Canadian democracy against attempts to destroy or subvert

them. These, we believe, are fundamental security

requirements which must be met in Canada if our country is to be truly self-governing (Second Report, Volume 1, para. 311) "

4.15 I have no doubt that a government is entitled, and indeed has a duty, to inform itself, with a view to taking pre-emptive or protective action, about the activities of any groups that may be using or working towards the use of force or violence for

the purposes of overthrowing or destroying the government or changing the constitutional form of government. A government has a legitimate interest in obtaining information about any such

groups and their plans, and about those who belong to such groups and their degree of commitment to the cause.

4.16 Information about activities involving the use of force or violence directed to more limited public ends is also a matter of legitimate security interest. I address ASI0 1 S role in relation to the more general area of politically motivated violence in Chapter 5.

4.17 A foreign element, in the sense of foreign direction or support, in activities that may be regarded as subversive can also make such activities a matter of clear security interest. A foreign element can carry with it an intrusion in the conduct of our own affairs, most Australians,

and an affront to national I believe, would regard as sovereignty, a threat to

that the

nation 1 s security and independence. foreign interference of this kind more detail in Chapter 3.

ASIO 1 s role

is addressed in relation to below, and in

48.

.18 The

iscussion activities.

level of threat is

of the role of ASIO

sometimes intro duced into in relation to subversive

In RCIS I stated that the material then before me id not establish that there was a very large amount of

subversive activity at that time (4:1, 76). ASI0 1 s own assessment at the present time is that the level of threat from

subversion is low. I am not aware of anything to suggest that

the position is otherwise.

4 .19 A low level of threat is no reason for denying AS IO the appropriately-defin ed subversiv e power to activities.

intelligence would be of

investigate The position about the can always change and, if it should,

emergence of any more serio us threat I be 1 i eve that AS I 0 need s to m a in t a in importance. powers and a capacity to investigate, assess and report on any

threat of this kind.

4 .20 A low level of threat does however have clear implications for the amount of resources that ASIO needs to direct to the

study of subversion.

4 .21 In RCIS the question whether the obtaining of intelligenc e

:about subversion should be left to the various police forces and should not be a function of ASIO was discussed (4:1, 81-83) ∑ I concluded that it should be retained among ASIO, s functio ns. I have considered this question again, and I have come to the same

conclusion, although I will recommend an amended definition. d . d 1's a serious matter, I Subversion, in the narrow sense 1scusse , b t ch activit y before 11 and a government needs intelligence a ou su the constit utional

it escalates into a violent assault upon system of government.

1 ∑ of subversion is

4.22 Of its very nature, the P annlng

, clandestine and its early manifestations are deceptive. It is

t t

o find out about it after the

, not good enough for a governmen .

need fo r intelligence is not confined to

event. A government's information about particular Offe nces that may be committed but

49.

extends to information about those who are prepared to engage in or promote the activities, their plans and capabilities. A specialized intelligence body has some advantages in carrying out an intelligence role of this kind.

4. 23 Also, because the investigation of subversion can intrude upon activities which turn out not to have a subversive intent

and which are legitimate political activities, it is important that the agency to which the government has entrusted this task of investigation should not have the executive powers of a pol ice force and that its records and the communication of its

intelligence keeping the should be closely controlled. The importance of security service separate from the police has been emphasised

in 1949. by all political parties since the inception of ASIO

4.24 Moreover, without wishing to reflect upon any police force, I am still firmly of the view that the available evidence does not establish that the rights of citizens would be better protected if this function were left to a police force rather

than to ASIO.

4.25 Before discussing the relevant provisions of the ASIO Act, I should refer to important developments in Canada and the United States of America since the writing of the RCIS Fourth Report.

4.26 The new Canadian Security Intelligence Service Act, passed this year, has a central definition of 'threats to the security of Canada' which includes among those threats:

(d) activities directed toward undermining by covert unlawful acts, or directed toward or intended ultimately to lead to the destruction or overthrow by violence of, the constitutionally established system of government in Canada,

but does not include lawful advocacy, protest or dissent, unless carried on in conjunction with any of the activities referred to in paragraphs .. " to (d).

50.

4.27 this In the United States of America, the role of the FBI in area has since 1976 been regulated by Atto rney-General's guidelines. It has been submitted to m e that the relevant laws of the United States Government no longer refer to 'subversion'. In fact, the relevant guidelines for the FB I now in force only

refer to 'subversion' as such in the title but they are directed

to enterprises 'for the purpose of furtherin g political or social goals wholly or in part through activities that involve force or violence and a violation of the crimi nal laws of the United States'. There is in other words a requirement of an element of violence 1n activity that could be directed to overthrow of the constitution as well as to the attainment of

lesser goals. It is also important to remem ber tha t activities involving a foreign influence are regulated separat ely from the laws and guidelines (including that part I have quoted) applicable to wholly domestic activity.

4.28 Further details on the position in Canad a and the United States are set out at Appendix D.

STATUTORY PROVISIONS

4.29 Section 5 of the ASIO Act deals with subversion . Most although not all of its provisions stem from recommendations made in RCIS, albeit with some variations. Section 5 is in the

following terms:

5(1) For the purposes of this

persons, other than activities .of activities directed against a fore1gn

Act the activities , . . foreign or1g1n government, that

to be regarded as subversion are -

of

or

are

. 'll involve o r lead to, or are

(a) activities that 1nvolve, Wl . 1 r lead to the use . 'k l lt'mately to 1nvo ve o , 1ntended or 11 e Y u 1 1 ful acts (whether by of force or violence or otp~: t~~ a;urpose of overthrowin g those persons or by others) . t. al government of the or destroying the const1tu 1 ~n Commonwealth or of a State or Te rr1tory ; . to obstr uc ting , hindering or (b) activities d1rected the Defence Force of its interfering with the p~rformancefbyther activ ities by or for functions or the carry 1ng out 0 0 f securit y or the defence the Commonwealth for the purposes 0 of the Commonwealth; or 51.

(c) activities directed to promoting violence between different groups of persons in the community so as to endanger the peace, order

government of the Commonwealth.

or hatred Australi an or good

(2) For the purposes of this section, 'activities of foreign origin' means activities of, directed or subsidi zed by, or undertaken in active collaboration with, a foreign power or foreign political organization, whether carried on or to be carried on in Australia or outside Australia.

( 3) Nothing in this section affects the meaning of the expression 'subversion' in relation to activities of foreign origin or activities directed against a foreign government.'

4.30 The provisions of the Act require a distinction to be made between 'domestic subversion' - defined in s. 4 as activities of the kind to which s. 5 (1) applies - and what might be called

foreign directed or foreign influenced subversion. I discuss later the reason for this distinction, and whether it is more

appropriate to deal with subversive activities as one class of activity, regardless of any foreign involvement, with a separate definition to cover certain foreign influenced activities that go beyond that classification.

4.31 In considering the provisions of s. 5, and any proposals for change in them, it should be kept in mind that:

(a) they are not defining conduct which is to be declared unlawful; they are defining conduct which is appropriate for investigation by a security intelligence organisation;

(b) ASIO is not a law enforcement body; it has no power to

detain or to arrest anyone, or indeed to question anybody against their will; to assist in the

its role is to collect intelligence and

communicating that responsible authority, authorities.

protection of the Commonwealth by intelligence to the appropriate and by giving advice to Commonwealth

52.

Section 5(1) (a)

4 .32 The definition

b eing too narrow and

too narrow is often

1 n s " 5 ( 1) (a) has been crit icised both as

as being too wide. The criticis m that it is based on a view that it reflects a dated a pproach to subversio n. In modern times, so it is said, often it

.:1as been the government itself which has overthrown the

constitution . It is put that where people antagonistic to the

g overnment

g overnment,

have the

overthrown or essential condition destro yed of success

constitutional has been a

c ampaign of destabilisa tion trade unions involving acts and other groups so

such as m anipulati on of industrial and commercial

:supply and other economic

chaos, the manipulation of circumstances to create or

as the

to create the money to assist

in bringing about a similar chaos, and the inf iltration of the

g overnment and other areas of constitutional pow er by persons

d edicated to the overthrow of the constitutional system.

A . 33 Many

themselves,

of these acts might be non-violent and, in

lawful, but they would all be part of a general plot to destro y the existing constitutional system of government by

∑ violence or using means likely or intended to involve violence .

4 .34 Where there is no such element of violence , and no foreign

element, I indicated earlier

the broadest sense, might

my view that

be regarded

acti v ities which, in as undermining the

f t dy by a security establis hed order are not appropriate or s u service (4.10). In a free democratic society they are matters to

b e addressed and worked out in the general social and political

p rocess.

4.35 The view that the definition is too wide is often based on t activity or intention

a clai m that the nexus between the presen f

Of t

he constitut ional system o

and the possible overthrow that any risk to which the so remote insignif icant to justify an government could be activity gave rise

f the citizens by a security

intrusion into the activities o ld require a close

. The proponents of this view wou

would be too

organisation.

53.

nexus between the acts or intentions to be investigated and the commission of a crime, and generally a crime of violence, directed or relating to the overthrow of the constitut ional system of government.

4.36 Among the questions to be considered in relation to s.S(l) (a) are:

(a) Should the activities be defined by reference only to the overthrow or destruction of the constitutio nal system of government, or should they relate also to activities which are intended or likely to undermine or destabilise the established system of government?

(b) Should the definition refer to non-violent unlawful activity, whether overt or covert, as well as to violence?

(c) How close should the connection be between,. the present acts or intention and the purpose intended or likely to be achieved?

4.37 The construction and effect of s. 5(1) (a) of the ASIO Act were cons ide red by the Security Appeals Tribunal in a dec is ion given on 1 June 1983. It had been submitted. on behalf of the Director-General that the sub-section contemplated three

time-scales in the development of subversive activities. This submission was rejected by the Tribunal which said:

There are, therefore, not three time scales in section 5(1) (a), but three classes of activities. I may be engaged in or planning for an armed insurrection against the constitutional government; or I may attack its inequities

intending that others will be so persuaded by my words that they will use force to overthrow it. Or I may do the same thing without that intention; but my challenge may be so vehement and powerful that it will be likely to induce others to use force. In each of these cases, my activity is to be regarded as subversion. But if I seek to persuade others that the time may come when it will be necessary to

54.

4. 3 8

use force to overthrow the government actually but only potentially subversl∑v'e that activity is not (p.l7 of findings}.

as it

except

I accept this analysis of the paragraph as correct so far

goes. It will be seen that the analysis does not deal, perhaps inferentially, with the effect of the word 'ultimately ' which the

overthrown.

or with the nature of the constitutional system of 'other unlawful acts' government might

by

be

4.39 The expression 'potentially subversive' was taken by the Tribunal from RCIS (4:1, 71) in which the expression was applied to those persons or organisat ions who have merely a

'contemplation' of the acts in question. The nature of 'contemplation' in this context was describe d in these terms:

An intention to use any of the acts in the stated classes is to be contrasted with a mere contemplatio n that they may be used. Mere contemplation exists when persons have a purpose or espouse an ideology in which the possibility of the use of acts within the stated classes is foreseen or the nature of the purpose or the ideology involves that possibility, but not only the time for their use but their use at all, even though necessary to achieve the purpose, has been left for future decision {4:1, 70).

4.40 The definition in s. 5 (1) (a} is directed to the overthrow or destruction of the constitutional government. It is clear that there is at present no group or organisation in Australia which could achieve this result by violence or otherwise, either now or in any time frame that could be described as the near

future. t me tha

t such a comfortable

It may be wrong o assu

political climate could not change, but a long preceding period The most that organisat ions

of disturbance would be necessary. and groups whose objective is the f ∑ s to create

constitutional system could presentlY hope or 1

of government with

unrest and a lack of confidence in the system h ∑ h would give some the object of building up an atmosphere w lC reality to the prospect of revolutionary change.

overthrow of the

55.

4. 41 It is possible to imagine lawful and unlawful acts which could create such an atmosphere as, for example, by the

organisation of crippling strikes or the disruption of the country's economy in a way which creates a situation of chaos. However, unless accompanied by, or likely to lead to, violence

these are matters which, within the Australian environment, should properly be dealt with through the ordinary political processes. These processes should be strong and flexible enough to withstand any such strains. Moreover, many of the activities which could be undertaken for such a purpose could be undertaken for a much more limited purpose as, for example, the attainment of an industrial benefit or the ousting of the existing government, but by constitutional means. These activities, in

themselves, should not attract the attention of ASIO.

4.42 As indicated above (4.26) the Canadian Security

Intelligence Service Act identifies as a threat to the security of Canada activities directed towards undermining the constitutionally established system of government by covert unlawful acts. It is difficult to suggest any activities of this kind in Australia which by themselves would have any significant impact upon the constitutional system of government. Indeed it is a little hard to imagine what significant activities of this kind there could be which would not, in due course, be

translated into overt action and, if the constitutional system of government were to be overthrown, would not in due course become translated into violent action.

4. 43 If ASIO suspected that such covert activity was taking place, it might be appropriate for it to make sufficient inquiry to see what was intended, and to continue those inquiries only if it appeared that some violent activity was intended or likely, or if a foreign power was involved in or influencing the activity. In itself, such activity should not attract further attention by ASIO.

56.

4.44 would Another way of seeking to achieve revolutionary change be to organis e or to k provo e a successio n of violent activiti es which, with or without other lawful or unlawful activities designed to h 1 tt ∑ h e P a a1n t e object ive, are intended or are likely to lead to the overthrow of the constitutional system of government. The considerations different

involvement of v io lence gives rise to from those applicable to non-violent

activities. Although som e non-violent act ivities may be as

destabilising as violent activities, violence takes political activity onto another plane. government wants warning and protective measures.

It is also something of against which it needs which a

to plan

4 0 4 5 If the violence is directed to the overthrow of the

constit utional system it is a proper matter to be investi gated by the government's security agency. This would clearly be so in

the case of an enterprise for the violent overthrow of the constitution in the immediate or near future. The same

conclusion is justified where violence or its promot ion is part of the revolutionary design and the init ial violence has already commenced or its planned or likely occurrence is not too remote.

I emphasise that what I am considering here is violent activity

which is associated with the prospective overthrow of the constitution even though the particular violent activity would and could not have that effect in itself.

4.46 In the light of these considerations I have concluded that O f the constitutional

activities relating to the overthrow system of government which it is fo

r AS IO to investiga te proper

should be defined by reference to violence. In my view it is not

t define them by

reference to

necessary o d d Or l

ikely to undermine

non-violent activities inten e appropriate or or to

by . . t f g overnment ,

destabilise the const1tut1onal sys em 0 nor

reference to non-violent yet unlawful activiti es.

4.47 If the non-violent undermining

activities are associated with what may be a

or

mer e

57.

destabilising contemplation

of the violent overthrow or destruction of the system, ASIO would be justified in looking at those activities from time to time to learn what was happening, and to carry out an

investigation if they appeared to involve a real risk or danger of violent political activity (ASIO is authorised to obtain information that is 'relevant' to security - see 6. 6) " In the absence of the requisite intention or likelihood of violence, and assuming no foreign influence is involved, the ordinary political processes should be left to deal with the position.

4.48 The violent overthrow of the constitutional system of government to which I have referred is not limited to a single revolutionary attempt to achieve that result. That is included in the concept but, as I have

unlikely in Australia. There is indicated earlier, is quite also intended to be included

repeated violence associated with an intention of achieving or promoting the overthrow of the constitution, whether with or without the carrying out of other activities of a non-violent kind to assist the achievement of that purpose, even though none of the separate acts of violence in itself (save possibly the last) could result in that overthrow.

4. 49 It is necessary to consider whether there should be any limit to the length of time between present activities and the violence which is necessary to justify the present activities being regarded as subversive. As has appeared, mere

contemplation of possible violence is not enough, although it may justify some inquiry. Nor is mere rhetoric sufficient; that

appears from the decision of the Security Appeals Tribunal of 1 June 1983 (4.37).

4.50 It has been submitted to the Commission, and I think

rightly, that the word 'ultimately' is too general and indefinite an indication of the time element. It suggests that something very close to mere contemplation is sufficient, not to justify inquiry,but to constitute subversion. On the other hand, I do not think that there must be a threat of immediate

58.

violence. The carrying out by ASIO of its duty to aid in the protection of the security of the Commonwealth would require ASIO to have more notice of the likelihood of violence than is

contemplated by the phrase 'a threat of imminent violence' " No description or definition could point to a precise time, applicable to all cases, but whether fixed by definition, guidelines or otherwise, the time involved, lying between

immediacy and the vagueness of 'ultimately', should give rise to a present concern for the protection of the Commonwealth.

4.51 In the light of the considerations which I have discussed and of the submissions which have been made to the Commission I have considered what amendments should be made to the definition

of subversion in s. 5 ( 1) (a) " Many of the submissions have been made without appreciating the limitations upon the effect of the

definition that have been pointed out by the Security Appeals Tribunal. They are also often based upon activities attributed to ASIO before the 1979 legislation, or to alleged activities since that legislation was enacted, many of which, if they took place at all, were not activities of ASIO. Nevertheless, I have concluded that the definition should be tightened in some

respects.

4.52 As indicated earlier, I do not think that the definition should be based on any 'unlawful activities'alone. I am unable realistically to suggest any unlawful activities which, without introducing violence, would result in the overthrow of the constitutional government; nor has ASIO. Again the addition of

the word 'force' to 'violence' does not seem to add any

significant element to the definition.

4.53 Further, the purpose of the subversive activities, presently described in s.S(l) (a) as 'overthrowing or destroying the constitutional government', should I think be clarif ied. The broad notion of overthrowing a constitutional government by

violent means seems to envisage two possibilities: first, the

overthrowing of a properly constit uted government by violent

59.

means and, secondly, the effecting constitutional system of government practical terms there is likely to be a

of

by

a change in

violent means. the

In

large measure of overlap

between the two, but it is possible to envisage circumstances of the one kind not involving the other. It should be made clear that both possibilities are covered.

4.54 The new definition should refer to activities which 'involve' the use of violence for what I will call overthrowing the Constitution. The word 'involve' connotes present violent activities for that purpose. It need not use the words 'will

involve or lead to', which are in s.5(1) {a) at present, for their effect is encompassed by the words in that provision, and referred to below, about 'intended or likely' consequences. If it is thought that this is a wrong or doubtful view, they could be included, but I am unable to say what purpose they would achieve. It also should include activities that 'are intended or likely to lead to violence' for the purpose of overthrowing the constitution. Both intention and likelihood are required to be a present intention or likelihood, although the violent acts will be carried out in the future.

4.55 The activities involving violence are those which involve an intention in respect of a present proposal for some

future violence, or a present proposal of some future activitie s which, although not violent in themselves, are presently intended to lead to violence. Intention is a subjective matter and may be difficult or impossible to discover with any certainty. The word 'likely' points to an objective test as to

the results of present activities. The activities must be such that it can be determined that there is a present likelihood that they will involve violence or will lead to violence for the purposes of overthrowing the Constitution.

4.56 The definition should expressly refer to the more possibl e situation of a succession of acts of violence. The word 'ultimately' should not be included, as it points to, and indeed

60.

encourages, an approach that it does not matter how distant in the future the projected violence may occur. The need for a present intention or a present likelihood of activities involving or which will lead to violence imports a limitation on

the period of time without attempting the task, which I think is impractical, of defining it precisely or of limiting the time arbitrarily, which I think is inappropriate.

4.57 It has been submitted to the Commission that the important function of ASIO under s.37 (1) to furnish Commonwealth agencies with security assessments could be seriously prejudiced by limiting the definition of 'subversion' in s.5(1) (a). Of the various grounds upon which this submission is based the most significant one, and the only one I deal with here, is that people who are committed to the overthrow of the constitutional

system of government inevitably have a conflict of loyalty, and that to allow them access to the nation's security classified material constitutes an unacceptable risk.

4.58 It is important, in my view, to determine on their own significance and relevance what activities are to be regarded as prejudicial to security for the purpose of authorizing ASIO to investigate them. Once those activities are determined, they

will of course be relevant to the assessment of the suitability of individuals to have access to national security information. ∑ But the fact that there may be other matters, extending beyond

'security' as defined for the purposes of ASIO's role, that bear on the granting of security clearances to individuals is not a

reason for widening the definition of 'security' in the ASIO Act. That would be a case of the tail wagging the dog.

4.59 In Chapter 9, which deals with security assessments, it is pointed out that there are relevant aspects of reliability and loyalty which extend beyond matters of security of the kind with which ASIO is concerned. Changes are recommended to strengthen

the system by which employing departments inquire into and consider those wider aspects. Membership of, and commitment to,

61.

the a1ms of an extremist body, notwithstanding that the body is not regarded as subversive or otherwise of security interest under the ASIO Act, may still be relevant to consideration of the suitability of a person for a security clearance. Whilst as a practical matter reliance could not be placed on ASIO's

records in such a case, membership of such a body would still be a matter of legitimate inquiry of the person in question or, in

relation to him, of referees.

4.60 I do not think that the recommended changes in the

definition of 'subversion' should unduly prejudice the operation of the security clearance system. The standards to be applied will certainly not be lower than those currently applied in the United States, for example, provided that the investigation of reliability and loyalty beyond ASIO's area of responsibility is adequately carried out. Moreover the distinction between a case where talk of violence is mere rhetoric (which is not covered by the definition now) , and the case advocated violence is indefinitely

where the prospect remote (which may of the

not be

covered in the future}, is such a fine one that I have concluded that there is no appreciable risk of endangering the

Commonwealth's security by altering the definition.

4.61 Accordingly I have concluded that s.S(l) (a) should be amended to provide that those activities which, for the purposes

of the ASIO Act, are to be regarded as a threat to security are activities of persons which involve violence or are intended or likely to lead to violence and are directed to the overthrow or destruction, whether by themselves or together with other or subsequent acts of violence or whether with or without other unlawful acts, of the government or the constitutional form of government of the Commonwealth or of a State or Territory. I discuss later the question whether or not it may be more appropriate to deal with these activities in the context of politically motivated violence rather than under the heading of subversion.

62.

Section 5 (1) (b) 4.62 This provision includes within the definition of subversion:

activities directed to obstructing, hindering or interfering with the performance by the Defence Force of its functions or the carrying out of other activities by or for the Commonwealth for the purposes of security or the defence of

the Commonwealth.

4.63 These activities are a proper subject for investigation by a security organisation. The types of activity covered by this

paragraph could vary from the violent destruction of Defence Force property or the subversion or attempted or planned subversion of members of the Defence Force to the organisation and the carrying out of a demonstration to obstruct access to a

Defence Force facility.

4.64 The Commission has received no submission that these activities should not be included as proper matters for ASIO's investigation, save for a view expressed within ASIO itself that some activities falling within the scope of the provision would

have no, or such a minimal, effect upon the functioning of the

Defence Force that they should not attract ASIO's attention.

4.65 ASIO acts on a view of s. 5 (1) (b) which I consider to be

too narrow. ASIO's 'Guidelines for ASIO coverage of Mass Issues' state that s. 5 (1) (b) 'should not be invoked in peace time except in special circumstances', and add, as an example, that in the case of sensitive Defence Force installations where an

interruption to the services they provide may be prejudicial to national security, the provision should only be invoked when it is apparent that protestors have the clear intention to close the facilities or to disrupt seriously the serv1ces they provide. Unless 'special' means 'calling for investigation by ASIO', this qualification is not justified. The example begs the question of how ASIO can find out what the 'clear intention' of

the protestors is, and whether it is changed from time to time.

63.

The presumption against the provision being invoked in peacetime is not in my view warranted.

4.66 No doubt the need for protection against the activities contemplated by the paragraph is more pressing in times of war or crisis, but a need for some form of protection exists at all times.

4.67 It must be remembered that as ASIO's function is to obtain and communicate intelligence, it may have to carry out some investigation to determine whether an activity which it knows or suspects will take place will be insignificant or destructive and violent. If, in ASIO's judgment, the threatened activity will or may be significant (in terms of obstructing, hindering or interfering with Defence functions), it should try to discover what is planned or likely to happen, and warn the Defence Force and/or the Defence Department what it is they have to guard against.

4. 68 It is not good enough for ASIO to adopt the attitude,

understandable though it may be, that it will not perform its duty under the provision because it does not want to bear the odium of becoming involved in ' mass issues'. I agree that this involvement is to be avoided unless necessary. I also agree that

intrusive action in respect of a 'mass issue' organisation should not be undertaken by ASIO unless it has information that there is a real risk that significant damage to or interference with a Defence facility or activity will take place. If it has this information and intrusive action becomes necessary, it should not be avoided because the organisation is a 'mass issue' one. Indeed, what ASIO may be able to do (and this has happened

in the past) is to prevent an undesirable over-reaction to what is feared may be the consequences of 'mass issue' action.

4.69 I

s.S(l)(b) have concluded should be left that

as a

the activities referred to in subject of ASIO' s investigatory

powers, although ASIO's involvement in any particular case would

64.

be a matter for judgment. It might also be a proper subject for

guidelines by the Attorney-General (See proposal in Chapter 116 for a system of ministerial guidelines on particular subjects).

Section 5 (1) {c) 4.70 This provision includes within the definition of subversion:

activities directed to promoting violence or hatred between different groups of persons in the Australian community so as to endanger the peace, order or good government of the Commonwealth.

4.71 This provision did not originate from an RCIS

recommendation. Neither the Minister's Second Reading Speech nor the parliamentary notes on the clauses of the Bill refer to its purpose, but presumably it was inserted with a view to enabling ASIO to collect intelligence on possible violence between

racial, religious, political or other groups in Australia. The form which the paragraph takes may have been based on s. 24A (g)

of the Crimes Act 1914 which provides that an intention:

to promote feelings different classes of endanger the peace, Commonwealth

of ill will and hostility Her Majesty's subjects so order or good government

between as to

of the

is a seditious intention. This provision had its origin in the common law of sedition and the classes to which it referred

presumably were primarily social or economic classes of persons. The language used in s. 5 (1} (c) is more apt to relate to groups

identified by race, religion etc, although it is broad enough to cover classes identified on some more general basis.

4.72 This provision was criticised by the Commission of Inquiry Concerning Certain Activities of the Royal Canadian Mounted Police. The Commission expressed the view that the subject matter of the provision was disorderly assemblies and communal

violence, and said:

65.

A mandate to investigate to civil disorder could radical or dissenting demonstrations [2nd Report,

political activity which may lead justify spying on groups whose views may provoke opposing

Vol. 1, 1981, 439-440]

4.73 Notwithstanding this criticism (for which I have found no basis in any of ASIO's activities), I have concluded that, subject to an amendment which I shall recommend, these

activities are a proper subject matter for ASIO to investigate. Although anti-discrimination legislation can be effective to diminish the negative effects of discrimination between different groups of citizens the deliberate promotion of violence between those groups is a matter of serious concern about which the Government has a real interest in obtaining notice b~fore the violence erupts.

4.74 The present provision relates both to violence and to hatred. Hatred can breed violence but I have concluded that the provision should exclude the promotion of hatred. Hatred is a subjective concept, and it is more appropriate that ASIO's concern should be with the prospect of violence. Inclusion of the concept of hatred gives the provision an overly broad operation extending political campaign. that it does not provision.

even to bitter exchanges in a hard-fought The Human Rights Commission has informed me

support the retention of 'hatred' in the

Foreign subversion 4.75 4.29) As appears from the provisions of s.5 of the ASIO Act (see

the definition of 'subversion' in that section was intended to be limited to what may be called domestic

subversion. In relation to activities of foreign origin 'subversion' was to be given its ordinary dictionary meaning.

4.76 The reason for drawing a distinction foreign subversion, and for legislatively but not the latter, was discussed in Essentially it was the absence of a

66.

between domestic and defining the former RC IS ( 4 : 1, 6 2-6 4) "

potential danger to

democracy in investigating foreign activities that led to the recommendation that legislative guidelines were neither appropriate nor necessary.

4. 77 An element of foreign direction or support can add a level of threat, as well as constituting an affront to national independence and sovereignty, to activities which, if wholly domestic, might not be regarded as proper matters of security concern. Thus if a foreign power was attempting to undermine

some part of the Australian polity and was making use of an Australian organisation for this purpose, Australia's security organisation should be entitled to investigate the activity and keep the Government fully advised about it. There would not be

the same need to keep the investigation within the same confines as an investigation into wholly domestic activities.

4.78 I have concluded however that the present open-ended nature of the meaning of foreign subversion under the ASIO Act is not satisfactory. The practical result has been, as discussed below (4.112), that ASIO has concentrated its efforts on the ascertainment of foreign links with potentially subversive groups in Australia without giving sufficient consideration to

whether the activities of the groups can in fact be regarded as subversive or otherwise of security interest.

4.79 I propose that the present distinction between 'domestic' and 'foreign' activities should be removed from s.5 (or its equivalent if my other recommendations for change are adopted). So far as the activities of an organisation with a foreign nexus would attract ASIO's attention if there were no such nexus, ASIO

should be able to rely on the relevant legislative provisions which apply to domestic organisations. In other words, the definitions in s. 5 (1) should apply to foreign influenced activities as well as to those which are wholly domestic.

4.80 Other foreign influenced activities, extending beyond those covered by s. 5 (l), which ASIO should invest igate include

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those which presently fall within the concept of 'active measures of foreign intervention'. In Chapter 3 I propose a new name, 'acts of foreign interference', and a new definition for

these activities. My purpose in proposing this variation of the Act is to seek to ensure that ASIO and those guiding its path will have clearer guidelines as to the relevance of a foreign connection.

Recognition of right to dissent 4.81 It has been submitted, and correctly, that it was not the purpose of the legislature in enacting the ASIO Act to impinge upon the constitutional right of citizens, basic to democracy, of lawful advocacy, protest or dissent. By itself the exercise of this right should not attract the attention of ASIO. I use the words 'by itself' because the right may be exercised as part of a series of acts that otherwise should attract the attention of ASIO.

4. 82 An organisation may plan the violent overthrow of the Constitution and part of the plan may involve the organisation of protests to build up a situation in which the achievement of its purpose may become feasible. Again the protest may be carried out on the directions of a foreign power for purposes detrimental to the interests of Australia. Unless some such purpose is present, protests should not be of interest to ASIO . Given such a purpose, they may properly be of interest to ASIO. ASIO could investigate the planning and the carrying out of that

purpose of which a protest was but an incident.

4.83 In the

definition of Canadian 'threats' Security Intelligence Service Act, the

to the security of Canada concludes with

a statement that those threats do not 'include lawful advocacy, protest or dissent, unless carried on in conjunction with any of the activities' defined as threats to that security. An analogous situation appears in s.24(F) of the Crimes Act 1914

68.

which excludes from the provisions of the Act relating to

seditious activity what might be described as lawful advocacy, protest or dissent in good faith.

4.84 In s.20 of the ASIO Act special responsibilities are placed upon the Director-General in relation to the functions of ASIO which were probably intended to preclude the Organization

from improperly intruding into the area of proper political

activities. I agree with submissions made to me that this section does not go far enough and there should be a provision in the Act emphasising the intention I have described. I favour

the inclusion in the Act of a provision such as the following:

It is not a purpose of this Act that the right of lawful advocacy, protest or dissent should be affected or that its exercise should, by itself, constitute activity prejudicial to security, and this Act is to be construed accordingly.

Re-arrangement and amendment of definition 4.85 The proposals I have made for change in the provisions of

s.5 lend themselves to some re-arrangement of the definition of 'security' in the ASIO Act.

4.86 The definition in s.S(l) (a) will be concerned with the actual or prospective use of violence for a particular political purpose. Although the activities could still be described as subversive, particular

it may be more appropriate to deal with form of violence along with terrorism them as a

and other

politically motivated violence. Under this proposal 'politically motivated violence' would be substituted for 'terrorism' as a heading in the definition of 'security' in s.4. Politically motivated violence would then be defined to include violence directed to the overthrow of the constitutional system of government and other acts of violence including terrorism.

4.87 The activities described in s.S(l) (b) are not limited to

acts of violence, but they could be included under an

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appropriate heading of 'security' such as 'attacks on defence and security'. Appropriate definitions would have to be added to s.4.

4.88 The activities now described in violence, motivated

could be listed Since under this

the

s.S(l) (c), but li mit ed to heading of politica lly

violence. violence is not alwa ys

politically motivated, however, it may be better to include it, by a suitable description, as a separate head under paragraph (a) of the definition of 'security'. It could be described as 'promotion of communal violence'.

4.89 Whatever form of legislation is adopted in respect of the matters now described as subversion in s. 5(1), I recommend that activities of foreign origin be included within their application as is the case with the matters otherwise referred to in the definition of 'security'. This amendment will not limit ASIO's role in investigating activities falling within other matters in that definition, including th~t expressly concerned with foreign involvement.

4. 90 I have concluded that there is substance in the proposal I to do away, in the definition of 'security', with the separate 1 categorisation of activities under the heading of 'subversi on'. As I previously pointed out, subversion is not the name of any

common law or statutory offence. The word has produced much 1 adverse reaction and may also, by its vague overtones of anti-government activity, tend to mislead people as to the 1 nature of the activity wh ich ASIO is intended to investigate. I If, as I recommend, the relevant activity is defined by reference to actual or prospective violence, it is truly a form / of politically motivated violence, and to treat it so wou ld not be merely a cosmetic change, but a change which would point

correctly to what is intended to be the subject-matte r of ASIO's attention.

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4.91 I recommend that:

(a) the definition of 'subversion' in s. 5 of the ASIO Act

should be amended and the provisions now in the section should be replaced by provisions in s.4 of the Act;

(b) the word 'subversion' should not be used in the ASIO Act but

the activities previously so described should be treated as a form of politically motivated violence or, if, in a

particular case, that is not appropriate, under a separate and special description;

(c) section 5(1) (a) of the ASIO Act should be repealed and

replaced by a paragraph in a definition of 'politically motivated violence' to be inserted in s.4 describing the activities now described in s.5(1) (a) as those activities of persons which involve violence or are intended or likely to

lead to violence (whether by those persons or by others) and are directed to the overthrow or destruction, whether by themselves or together with other or subsequent acts of violence or whether with or without other unlawful acts, of

the government or the constitutional form of government of the Commonwealth or of a State or Territory;

(d) the activities now described in s.5(1) {b) should be left as

a subject of ASIO's investigatory powers but they should not

be described as subversion and should be included in the definition of 'security' in s.4 perhaps under the description of 'attacks on defence and security' - as one of the matters from which the Commonwealth and the several States and Territories and their people are to be protected;

(e) the Attorney-General consider laying down guidelines to

regulate the exercise by ASIO of its powers in respect of the activities now described in s.5(1) (b);

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(f) the activities now described in s.S(l) (c), subject to the deletion of the words 'or hatred', should be left as a subject of ASIO's investigatory powers, but they should not be described as subversion and should either be included in a new definition of 'politically motivated violence' or in

the definition of 'security' in s.4 as one of the matters -perhaps described as 'promotion of communal violence' - from which the Commonwealth and the several States and

Territories and their people are to be protected:

(g) the activities described in the provisions substituted for

s.S(l) (a), (b) and (c) should include activities of foreig n origin, but these provisions should not limit the functio n and power of ASIO to investigate activities which fall within the separate definition of 'active measures of I foreign intervention' or of any new definition of activitie s of foreign origin;

(h) the ASIO Act should be amended to provide expr~ssly that it ~

is not a purpose of the Act that the right of lawfu l ~

advocacy, protest or dissent should be affected or that its'/ exercise should, by itself, constitute activity prejudica l ~ to security, and that the Act is to be construed accordingly . 11 Sedition 4.92 As pointed out earlier, subversion is not the name of any ' common law or statutory criminal offence. An offence which is ~'

related to subversion, although not covering the same field, is , sedit ion. Because of the relationship between the concepts, and the relevance of seditious conduct to security in the sense with which ASIO is concerned with it, I believe it would be /

appropriate to say something about the offence of sedition.

4.93 The doing of certain things with a seditious intention and the publishing, including the speaking, of seditious words were offences at common law. The common law still prevails in Ne~t~ South Wales, South Australia and Victoria, although there has /

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been a statutory extension of the law in Victoria. It is regulated by the criminal codes of the other States. Sections 24A - 24F of the Crimes Act 1914 are the source of Commonwealth

law on the matter. (An interesting discussion of the common law

and statutory provisions is to be found in 'Emergency Powers'

H.P. Lee, Law Book Co. Limited, 1984.)

4.94 It would seem that at common law the relevant offences might not at first have required any ingredient of incitement to violence, but that ingredient has been regarded as necessary at least since R. v Burns (1886} 16 Cox C.C. 355. In that case

Cave, J. directed the jury that the offence was established if

the defendants had to create public an intention to incite people to violence or disturbances and disorder. This view was substantially adopted in 1951 by the Supreme Court of Canada in Boucher v. R. (1951) 2 D.L.R. 369, and by a report of the

English Law Commission (Working Paper No. 72, p. 44). In R. v. Aldred (1909) 22 Cox c.c. 1 at 3, Coleridge, J., in the course of summing up to the jury in relation to a charge of uttering seditious words, said:

The test is this: was the language used calculated, or was ' it not, to promote public disorder or physical violence in a matter of State?

4.95 A question which does not appear to be finally resolved is whether the defendant must be shown to have had a subjective

intention to create violence or public disturbance and disorder, or whether it is sufficient that, objectively, what he said was

likely to produce such a result. There are practical and ' theoretical considerations supporting the objective test, but it

could involve the problem that a person, wishing to make a

peaceful protest, in good faith, might be guilt y of sedition if

his public statement would be likely to lead opponents to

demonstrate violently.

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4.96 Section 24A of the Crimes Act 1914 provides:

24A. An intention to effect any of the following purposes, that is to say: (a) to bring the Sovereign into hatred or contempt; (b) to excite disaffection against the Sovereign or the

Government or Constitution of the United Kingdom or against either House of the Parliament of the United Kingdom; (c) to excite disaffection against the Government or

Constitution of any of the Queen's dominions; (d) to excite disaffection against the Government or Constitution of the Commonwealth or against either House of the Parliament of the Commonwealth; (e) to excite disaffection against the connexion of the

Queen's dominions under the Crown; (f) to excite Her Majesty's subjects to attempt to procure the alteration, otherwise than by lawful means of any matter in the Commonwealth established by law of the

Commonwealth; or (g) to promote feelings of ill-will and hostility between different classes of Her Majesty's subjects so as to endanger the peace, order or good government of the

Commonwealth,

is a seditious intention.

4. 97 Sections 24B to 24D constitute seditious enterprises and the uttering of seditious words as offences. Section 24F excludes described faith.

from the operation of these provisions what I (4.83) as lawful advocacy, protest or dissent in have good

4.98 These provisions require amendment. I will limit my discussion of them to those matters which seem pertinent to my inquiry. Section 24A contains some provisions which are no longer relevant and which should be removed. These include the provisions in s.24A(b) referring to the Government or the Constitution of the United Kingdom and either House of

Parliament of the United Kingdom, and the provisions in s.24A(c) and (e) relating to the Government or Constitution of any of the 1 j Queen's dominions and the exciting of disaffection against the connection of the Queen's dominions under the Crown.

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∑4.99 More importantly, provision should be made to incorporate

in these sections the common law requirement of an intention to

"create vioience or public disturbance or disorder.

4.100 The effect of s. 24A was considered by the High Court in Burns v. Ransley (1949) 79 CLR 101 and R. v. Sharkey (1949) 79

CLR 121. Those cases concerned statements made by members of the Australian Communist Party as to their attitude if there were a war between the Soviet Union and the western powers, and if

Soviet forces entered Australia. In each case the High Court upheld the convictions for offences under the Crimes Act 1914. The prosecution " s case was simply the uttering of the words; it

was no part of its case that there was an intention to create

violence or public disturbance or disorder. The circumstances involved in those convictions re-inforce my view that s.24A should be amended to bring it into line with the common law.

4.101 Mere rhetoric or statements of political belief should

not be criminal offences, however obnoxious they may be to

constituted authority. Accordingly the legislation should be amended to provide that the writing, printing, uttering or

publishing of seditious words is not an offence unless done with

an intent to create violence or public disturbances or disorder.

There are a number of ways in which this could be done. One that

occurs to me is to add a proviso to s.24B(2) to require such an

intention if words are to be regarded as seditious.

4.102 I recommend that ss.24A to 24F of the Crimes Act 1914

should be amended to remove certain anachronistic provisions, and to provide that the writing, printing, uttering or

publishing of seditious words is not an offence unless done with

) an inte nt to create violence or public disturbance or disorder.

ASIO' S ACTIVITIES IN RESPECT OF SUBVERSION

4.103 My general view of ASIO's subversive studies activities

since RCIS and the 1979 legislation is that although criticism

can be made, and I make some, a sincere and substantially

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successful activities attempt has been made to those which are not

to limit the Organization's only within power but are

proper to be carried out. I have been impressed and indeed surprised by the careful and even anxious consideratio n which the officers in the relevant part of the Organization give to the questions they have to decide, and their consciousnes s of the civil liberties which may be affected by their decisio ns. I see a need though for changes in procedures, in this area as well as others in ASIO, to provide for regular and rigorous review of the status of particular investigations and of the

justification for the initiation or continuation of investigations. ASIO must continually review what it is doing in an area like subversive studies and make sure that the

justification for what it is doing is not simply that it is what has been done in the past. This is a problem of a kind which

tends to arise i~ any institutionalised system. ASIO needs to be particularly alive to the danger.

Targetting procedures 4.104 ASIO investigates groups or organisations considere d subversive or possibly subversive, and investigates indivi duals only in connection with their involvement in those groups or organisations. It considers that an individual could pose a threat to national security in terms of s. 5 (1) (a) only through collaboration with others.

4.105 The procedures to be taken within ASIO to decide whether activities justify investigation on the grounds that they are or might be subversive is presently regulated by a directive issued on 31 March 1980.

4.106 The procedures prescribed by the directive distinguish between 'subjects of investigation 1 and 1 targets 1 " Subjects of investigation are organisations which, because of their activities or pronouncements, ASIO believes ought to be

investigated to determine whether they are subversive in terms of the ASIO Act. In other words, they are organisations which

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ASIO believes might be subversive, and an investigation is

instituted to determine whether they are. The term 'target' in this context is used to describe organisations that in ASIO's view are subversive.

4.107 If an ASIO officer considers that an organisation is, or should be investigated to determine whether it is, subversive, he is required to make an argued submission to that effect. The submission must state fully the grounds for the officer's view and should explicitly relate the activities or pronouncements of

the organisation to provisions of the ASIO Act. The submission is considered by or under the supervision of a designated co-ordinating officer and ultimately the question which it raises is determined by the head of the Head Office branch

responsible for subversion. That officer may reject the submission, subject of target.

4.108 In

targets,

decide that the investigation, or organisation decide that it

should be made

should be made a

a

relation and in

to targets relation generally, including subversive to subversive subjects of

investigation, ASIO has a system requiring the preparation of intelligence collection programs (ICPs) which specify the objectives of an investigation. These programs are discussed in Chapter 6. In the case of an organisation which is made a

subject of investigation, the ICP is required to state clearly the limits to the 'investigational techniques' which may be used. The directive does not however impose any 1 imi ts on the nature of the permissible techniques which may be specified. In respect of organisations which are made targets, the ICPs lay down no limits on the investigational techniques which may be

used.

4.109 In practice the decision to make an organisation the subject of an investigation or a target is usually prompted by information collected by ASIO in the course of investigating other organisations already designated as targets or subjects of

77.

investigation. Although the directive was issued on 31 March 1980, it was not until 1983 that any organisation was made 'a subject of investigation' because of its possibly subversive activities. A number of organisations were designated as targets during this period.

4.110 The directive requires that the ICP for a subject of investigation specify a time during which the investigation is to take place. Towards the end of the period the responsible officer is required to make argued recommendations as to whether the investigation should be abandoned, whether it should be continued for a further specified period, or whether the organisation should be made a target.

4.111 One major

provides for an defect in the examination of system is that,

the position of although subjects it

of

investigation, there is no such provision in respect of organisations which were already designated, or have since been designated, as targets. No such review seems to have taken place in recent years until after a decision of the Security Appeals Tribunal of 1 June 1983. Apart from any action that should have been taken following the issuing of the directive, no action was

taken by ASIO after the enactment of the ASIO Act in 1979 to

reconsider the status of targetted organisations as a result of the new definitions which were contained in that Act. Although there was a reduction in the number of targetted organisations following RCIS, the new statutory provisions undoubtedly called for a review to make sure their terms were satisfied.

4.112 The lack of proper review and consideration of the justification for investigations is evident in respect of the investigation of organisations in relation to activities of foreign origin. My examination of ASIO's practice in this area has shown that it is directed principally to the identification of the foreign link with the organisation, whether it be in terms of foreign direction, financial support or collaboration. Where there is such a foreign link, the activities of the

78.

II

I I

I

I

identified organisation appear to be investigated without any, or any due, consideration being given to the nature of the activity with which the organisation is involved. ASIO's interest should not be in foreign influenced activities at large but in such activities if they are subversive. ASIO's

investigation of the activities of such an organisation should be directed to ascertaining whether they are carried out in a manner or for a purpose detrimental . to Australia's interests, or otherwise represent improper intrusions upon social or political processes in Australia.

4.113 The decision of the Security Appeals Tribunal on 1 June 1983 concerned the Communist Party of Australia and concluded

that it was not now subversive within the meaning of the

definition in s.S(l) (a). Although this conclusion would have to be taken into account by ASIO in deciding what action it should take in respect of the Party under s.l7, the Tribunal expressly stated that its findings did not affect the exercise of the functions of ASIO under s.l7 to obtain, correlate and evaluate

intelligence relevant to security. However, the initiated a review by ASIO of its relevant activities. decision

4.114 That review was both necessary and belated. There should be a process of consideration and review, on a regular and continuing basis, in order to determine which organisat ions should be, or should continue to be, investigated or targetted.

4.115 There is virtue in retaining a system of categorisation of subjects of investigation and targets along present lines, but it is important that proper consideration is required to be

given, and is given, both to the nature and extent of the investigative techniques which are authorised to be used in relation to particular organisations, and to the hold ing of regular reviews to determine whether particu lar investigations should be carried on to a lesser extent, or should be abandoned,

79.

or should be carried on more intensely. These questions are addressed in Chapter 6 in relation to ASIO's intelligence collection functions generally.

4.116 I recommend that any directive or other document

regulating the investigation of activities regarded as actually or potentially subversive should be redrafted, consistently with guidelines proposed in Chapter 6 to regulate ASIO' s collection of intelligence, so as to deal fully and adequately with the extent to which intrusive methods of investigation may be used by ASIO, and to provide for regular review of inquiries and

investigations and of the justificiation for treating particular organisations as subjects of investigation or as targets.

Extent of operations 4.117 ASIO's Australia as present assessment of

being low is reflected the

in

subversive the extent threat to of ASIO' s

activities in relation to subversive studies. The total number of organisations targetted for subversive studies purposes is small. A few are right wing organisations; a larger number are left wing organisations. These organisations include not only those organisations which are considered by ASIO to fall within the provisions of s.5(1) (a) of the ASIO Act but also those organisations which are foreign influenced. The number of groups or organisations which ASIO considers subversive or possibly subversive within the terms of s.5(1) (a) is very small, as is their estimated total membership.

4.118 The number of telephone interceptions authorised by warrant in relation to subversion for each of the years from 1978-79 to 1983-84 were as follows:

78-79 79-80 80-81 81-82 82-83 83-84

New 6 3 5 3 3 1

Renewals 20 15 11 10 12 3 -- 26 18 16 13 15 4

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In relation to the figure for renewals, it should be remembered that the longest period for which any such warrant is in force is six months. The renewal of one, previously issued, warrant will often account for two of the renewals shown in the table

for a particular year.

4.119 The total number of telephones the subject of war rants over these six years was about thirty. Over the same period, the Attorney-General granted for subversive studies purposes six warrants for the use of listening devices, one entry and search

warrant, and no mail or telex interception warrants. In the period from January 1981 to November 1984 the total number of individuals the subject of surveillance by ASIO for subversive studies purposes was 37. One of these persons was surveilled for a total of 20 days; the others for periods ranging from 1 day to 8 days (not necessarily consecutive). These figures give an idea of the limited activity of ASIO in the subversion area.

4.120 In the financial year 1982-83, 44.4 per cent of ASIO' s budget was spent on intelligence collection. Of this amount 7.51 per cent was spent on subversive studies, including foreign influenced activities. Thus only about one-sixth of ASIO's

intelligence activities was directed to this area. Most of the funds used for intelligence collection were spent on counter-espionage and counter-terrorism activities. The equivalent figures for the financial year 1983-84 are 45.74 per cent, 6.55 per cent, and about one-seventh.

4.121 In the Fourth RCIS Report special consideration was given to a number of areas in which ASIO had become involved in

relation to subversion. Of those areas, the private sector, the media and State employees no longer call for comment. I will discuss the two remaining areas, universities and trade unions,

in order to show the extent of ASIO's present activities in relation to subversive studies.

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Universities 4.122 New instructions regulating the contact by ASIO with members of the staff or students of Australian universities and

other tertiary educational institutions were issued on 3 Augus t 1978. Special care is required to be taken in respect of all

classes of contact, even though there is nothing special in the situa tion save that the person to be contacted is on a campus . Thus university staff members or students nominated as referees may only be inte rviewed with the approval of an Assistan t

Director-General, the interviewing officers must be careful ly selected and, if possible, the interviews are not to take place on campus. In no circumstances are students, nominated as referees, to be interviewed on campus.

4.123 Numbers of ASIO officers attend universities as students and they are neither required nor permitted to report on security matters which come to their knowledge by virtue of their presence on campus for the purpose of their studies. In particular they are not to be tasked to collect overt

information from noticeboards or pamphlets or other information from general distribution points. They are not to be tasked to obtain information about planned demonstrations. Only designated senior officers may contact Careers and Appointments Boards.

4.124 Contact with senior executive officers is undertaken by regional directors personally or by a senior officer of a regional office. This contact is for limited purposes. It may be in the course of field inquiries, that is, for the purposes of identifying a person, checking qualifications and the like. Sometimes these university officers are contacted in relation to the recrui tment of a university graduate or staff member as an ASIO officer and occasionally for other purposes.

4.125 The instructions also address the use contacts. If a staff member or student is to contact or agent on the campus considerable

of agents and

be used as a

restraint is

required. Before an agent is recruited, the approval of the

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Deputy Director-General must be obtained and all stages of the recruitment will be subject to review and approval by Head Office. Likewise proposals to approach any person on a campus to be a contact for ASIO must be submitted to Head Office for

approval by the Deputy Director-General before any approach is made.

4.126 Apart from care and discretion exercised in the selection or recruitment of agents and contacts, considerable care is required to ensure that the proposed action is a proper one for ASIO to take. As was pointed out in the Fourth RCIS Report the

fact that persons hold radical views or may induce radical action disrupting a tertiary institution's affairs are not matters justifying ASIO's intervention. It is only if the activity of persons on campus is, or is likely to induce others

to be, subversive, or is otherwise prejudicial to the security of Australia, that ASIO's involvement could be justified. Where this is the case, ASIO must be prepared to make proper inquiries within the scope of any guidelines. While care is required on ASIO's part, universities, like any other institution, should

not be regarded as off limits to ASIO.

4.127 Because from time to time radical views are expressed on campuses, great care must be exercised in distinguishing between fact and theory, and between radical thought and revolutionar y expression. The caution shown by ASIO is evidenced by its present limited involvement on campuses.

4.128 The use of agents in universities for the purpose of obtaining information about targetted absolutely minimal, and is in accordance functions.

organisations is with its statutor y

4.129 Apart from persons who help with general field inquiries and talent spotting, ASIO's contacts on campuses obtain material

available to all staff and students which ASIO considers that it should have for proper security purposes. This limited activity

83.

in relation to universities seems unexceptional. ASIO has in recent years exercised caution, and as far as I can see has acted properly, in relation to universities and like instituti ons. If an Inspector-General or Attorney-General considered any particular action to be inappropriate, the matter could be reported or directions of a general or partic ular nature given.

Trade unions 4.130 ASIO's involvement with trade unions was also considere d in the Fourth RCIS Report. Before that inquiry, ASIO's actual or suspected activity with relation to trade unions was the subject of disquiet among considerable sections of the public as well as trade unions. Following RCIS the position changed significantl y. ASIO has no interest in any trade union activity as such, and no

trade union is a target organisation. Information concerning subversive influence in trade unions is collected only as part of monitoring the activities of organisations, not being trade unions, which are targets or of persons associated with those targets who actively pursue the target organisation's objectives. It is when those activities include involvement in un1on affairs that ASIO collects intelligence about the activities of the target organisations or persons in unions.

4.131 ASIC obtains information about trade ∑unions and trade union officials, where there is some relevant connection with a target organisation, from overt sources such as trade union directories, union publications and newspapers. It does not

intercept the telephones of trade unions, and it does not intercept the telephones of trade union officials as such. Since 1979 it appears that the telephone of only one person who was a trade union official has been intercepted. The person whose telephone was intercepted was a senior member of a target organisation, and he also was an official of a trade union. Of course if a trade union official (or any other person)

telephone of a targetted organisation which is uses the being

intercepted, his call on that telephone will be intercepted.

84.

4.132 I have carefully inquired into the use by ASIO of agents and contacts in trade unions for the purpose of obtaining

information about the activities of target ted organisations. I am satisfied that their use is minimal, and is in accordance

with ASIO's statutory functions.

4.133 Activity in relation to trade unions is small compared with that which took place before RCIS. AS IO' s activities in trade unions fall within the terms of its charter and are proper activities to be carried out by it. As in the case of

universities, cases arise where ASIO should carry out investigations within trade unions. However it is an area which requires care and it would be proper for an Inspector-General to have close regard to ASIO's activities in this area. The Attorney-General might give consideration to the need for guidelines to be issued.

85.

terrorist targets and periods of threat, and in the successfu l management of a terrorist crisis (PSR 3.30).

5.9 Police forces have an interest and some capability in collecting and assessing relevant intelligence although, by reason of the nature of their roles, they tend to focus more on reaction to offences that have been committed than on assessment of possible emerging threats. While no clear line can be drawn

between the intelligence roles of police forces and ASIO in relation to terrorism, it is clear that a body like ASIO which is concerned wholly with security intelligence work, and has access to special powers, can make an important contribution to protective measures.

Background to ASIO's role 5.10 In RCIS I referred to the international ramifications of many forms of modern terrorism and to the importance to

Australia of having an organisation with access to intelligence about terrorism and identified or possible terrorists from other parts of the world. I referred to the importance of ASIO having this role in Australia (4:1, 91).

5.11 I concluded in RCIS that

politally motivated violence) terrorism was a

(and I

proper referred to field for

investigation by ASIO (4:1-104). As ASIO is a Commonwealth organisation, I recommended that ASIO should act as the

intelligence organisation in respect of those forms of terrorism with which the Commonwealth has authority to deal. I recommended that the legislation should be amended to make this clear (4:1, 98).

5.12 I indicated that the Commonwealth's power in relation to domestic terrorism exists only where the Commonwealth's safety is concerned, or where the safety of a State is concerned and the State has sought the assistance of the Commonwealth pursuant to s.ll9 of the Constitution (4:1, 97). I expressed the view that it would not be sufficient to define the terrorist activit y

88.

with which ASIO should concern itself as a violent activity for

.. political purposes, for much of this type of activity may be a

matter for State police only (4:1, 100).

5.13 ASIO's new legislation in 1979 empowered the Organization

to investigate terrorism, but the relevant provisions of the statute did not expressly limit the power to federal interests.

5.14 The question of responsibility for preparation of threat assessments in relation to the protection of holders of high office was discussed in Chapter 5 of the Report of the

Protective Security Review. At that time, Commonwealth authorities received two such assessments, one from ASIO, and one from the Commonwealth Police. In the Review I discussed the

problems to which this system gave rise, and recommended that ASIO, as the national organisation concerned with security

intelligence, should be made solely responsible for the production of national assessments in the field of terrorism, on the basis of intelligence which it receives from police as well as other sources ( 4. 4 5) " This recommendation was adopted and

given effect to administratively by the Commonwealth Government in 1979.

ASIO'S PRESENT AND FUTURE ROLE

5.15 ASIO is charged by its Act with the responsibility of obtaining, correlating and evaluating intelligence relevant to security and also with the responsibility of advising Ministers and authorities of the Commonwealth in respect of matters

relating to security ( s .17) . 'Security' , for the purposes of ASIO's areas of respons{bility and powers, is defined as

including the protection of, and of the people of, the Commonwealth and the States and Territories from 'terrorism'

(s.4). 'Terrorism' is defined in the same section as including:

(a) acts of violence for the purpose of achieving a

political objective in Australia or in a foreign country (including acts of violence for the purpose of

influencing the policy or acts of a government in Australia or in a foreign country);

89.

(b) training, planning, preparations or other activities for the purposes of violent subversion in a foreign country or for the purposes of the commission in a foreign

country of other acts of violence of a kind referred to in paragraph (a);

(c) acts that are offences punishable under the Crimes (Internationally Protected Persons) Act 1976; or (d) acts that are offences punishable under the Crimes (Hijacking of Aircraft) Act 1972 or the Crimes

(Protection of Aircraft) Act 1974.

5.16 The following activities would seem to be covered by this definition:

(a) terrorism as understood in common parlance;

(b) attacks on foreign internationally protected persons;

(c) attacks on the holders of Australian public offices for political purposes;

(d) violent activities in Australia to achieve political objectives in a foreign country, and training, planning and the like in Australia to carry out those violent activities in the foreign country;

(e) any other act of violence in Australia for the purpose of achieving a political objective.

It should be noted also that there is a degree of overlap between the violent activity that may be covered by terrorism as defined and the violent activity presently comprehended in the list of activities to be regarded as subversive (which I discussed in Chapter 4).

5.17 The definition of terrorism was not the subject of any criticism in the parliamentary debates on the 1979 legislation and no submission has been made to me about it. Nonetheless I

9 0.

regard it as my responsibility to review its terms and to

consider whether any amendment is appropriate.

Terrorism 5.18 I have no doubt that terrorism in the ordinary sense is a subject appropriately designated by the ASIO Act as being of security interest. The word is difficult to define precisely, but its relevant meaning covers acts or threats of violence, and generally of extreme violence, designed to instill fear, that

is, to terrorise, in order to achieve a political objective. Some terrorism does not involve violence in the strict sense,

but rather harm, as in the case of the poisoning of a city's water supply. As distinct from those cases where this violence is to be carried out overseas and the only relevant activities in Australia are planning and training, it is not necessary to

include such preparatory activities in a definition of domestic terrorism. They are matters which attract attention and investigation by ASIO, but are not terrorism in themselves.

5.19 An act of

activities which, terrorism would almost invariably encompass in themselves, would be regarded as criminal offences properly left to the police. The addition to such activities of a political dimension gives them a wider security,

and thus national, significance; it points to possible

involvement of a number of people and to the risk of repeated activities as part of a planned campaign; it amounts to an attack on the authority of the state.

5.20 Terrorism in this sense is a matter of obvious

Commonwealth concern, particularly if it is directed against the

Commonwealth Government or persons for whom the Commonwealth has

a particular responsibility or if it occurs within a

Commonwealth Territory or place. Even if it were to occur within a State, and be designed to influence the policy or acts of the

State government, the matter would assume a national

significance. ASIO, under its present charter, would be empow ered to act, and it could I think be expected that the

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State would look to the Commonwealth for assistance. This, in my view, would be entirely proper.

International elements 5.21 I have no doubt that the hijacking of aircraft and threats against the safety of internationally protected persons v isit ing Aus tralia, being matters in respect of which Australia has

internationa l obligations, are proper matters of securi ty

inter est on the part of ASIO.

5 .22 Because of its relevance to Australia's internat ional

relationships, I am satisfied that violent activity in Australi a to achieve political objectives in a foreign country and the training or carrying out of other preparations in Australia for

violent activities in a foreign country to attain a political

objective in that country are also proper matters of security interest by ASIO "

Other politically motivated violence 5.23 The acts of violence and political objectives covered by paragraph (a) of the definition of terrorism are wide enough to include, for example, a violent demonstration designed to induce the Australian Government to protect some part of the

environment, to change its pol icy in relation to the mining of

uranium, or to repeal or amend provisions of the Trade Practices Act 1974.

5.24 Violence of this kind may induce fear when it occurs but it may not be of a degree, or carried out with a purpose, that would ordinarily be regarded as terrorism. Whilst activit ies of this kind involve illegal acts and are proper matters for police attention (and for the police to have intelligence about),

ASIO's role in many if not most activities of this kind requires careful consideration. This is more so where the politi cal objective of the violence bears on State, rather than Commonwealth, interests or responsibilities.

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5.25 There is a view, strongly held by some officers of ASIO, that the Organization should not become involved in what are described as 'mass issues', even when a promotion of particular views upon those issues results in violence. The prospect of

that violent activity, even though it is for the purpose of achieving a political objective, is said not to be something which could properly be regarded as a 'security' matter. It is a

public law and order matter, and thus a matter primarily for the police to handle. This approach is reflected in ASIO' s present guidelines on the subject which, deleting comments on actual examples, are set out in Appendix E. (As regards the approach in

these guidelines to the peace time use of s.5(1) (b) of the ASIO Act, which seem to be too restrictive, see 4.65).

5.26 This restrained attitude towards 'mass issue' groups is very proper, but it cannot be adopted without qualification. There are some cases where ASIO should investigate the acts or intentions of those groups, despite its desire to avoid doing so.

5.27 There are some occasions on which violent activity of the kind I have described is associated with other circumstances which make it a matter of security concern, and thus proper for involvement on the part of ASIO. One such case is where the

violence is organised, or otherwise assisted or influenced by, the agents of a foreign power in order to promote the interests of that power. Another case is where the violent activity, although in itself directed to the achievement of a particular political objective, is organised or encouraged by an organisation targetted by ASIO because it has a policy of promoting disruption and violence for the purposes of

overthrowing the constitutional system of government.

5. 28 However 1 in these and other cases of a similar kind 1 the justification for the involvement of ASIO is not to be found in the violent activity for the achievement of a particular objective, but in the relationship of some other matter of proper security concern to that violent activity; ASIO's

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interest should begin and end with that other matter of security concern. Moreover the involvement in the violent activity of members of a target organisation may not have a significance justifying ASIO's interest in that activity. ASIO's guidelines accord with this view.

5.29 ASIO 's guidelines for coverage of mass issues also draw a distinction between premeditated violence and violence that is incidenta l to the form of protest. The collection of

intell igence is authorised:

If it becomes apparent that some of the protestors intend using acts of violence against persons or property for the purpose of achieving a political objective, ie. within the meaning of Section 4 paragraph (a) of the Act. A distinction should be drawn between premeditated acts of politically motivated violence and tactics of confrontation, minor breaches of the peace and 'heat of the moment' scuffles of a violent nature, which are matters for the police.

5.30 This guideline and its general effect, namely, that premeditated and serious violence for the purpose of achieving a limited political objective is a matter of security concern, is a proper approach to paragraph (a) of the present definition of

terrorism. However, the definition is wide and it calls for careful consideration.

5.31 Further, although the definition of 'security' refers to the protection of, and of the people of, the several States and Territories as well as the Commonwealth, I assume that the power to protect the States and Territories and their people was

intended to be directed to matters of national, rather than of mere local, concern. Thus the overthrow of a State government by violence would be a matter of national concern, as would be the destruction by sabotage of a State installation where the

installation, or its destruction by sabotage, is of national significance. In my opinion, non-terrorist acts of violence for the purpose of achieving a political objective in Australia, not touching directly on Commonwealth interests, should only be of interest to ASIO, if they should be of interest at all, if the

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II

matter is of such significance that the State looks to the Commonwealth for assistance and the Commonwealth regards it as a matter of national concern.

5.32 I have concluded that while politically motivated violence is always a matter of interest to police, it is only sometimes a matter appropriate for interest by ASIO. Violence amounting to terrorism is a proper matter of security interest for ASIO. There are cases where politically motivated violence, whether or

not it amounts to terrorism, is a matter of separate security interest to ASIO because it is, for example, subversive, or foreign influenced, or directed against defence installations.

Whether other politically motivated violence, not amounting to terrorism, has a security significance for ASIO will depend upon a number of circumstances.

5.33 Politically motivated violence can thus be seen to be an area where police and security roles overlap, where there are cases for proper security concern, but where it is difficult to give an adequate general description of the violence that falls

into the security category. While it would be unwise to define the notion of politically motivated violence narrowly for the purposes of ASIO's intelligence role, it is not easy to draw more widely a line that is practical to administer and provides

appropriate limits to ASIO's role.

5.34 I have concluded that,

politically motivated violence, paragraph (a) of the definition of

subject to a qualification, in the sense set out in

'terrorism' in s.4, should be

retained within the scope of the definition of 'security'. The qualification I propose is that ASIO should only be involved with politically motivated violence, defined in this broad sense, to the extent that such involvement is approved from time

to time by the Attorney-General. The Attorney-General's approval could be general, and issued in the form of guidelines. Or it

could be specific and given for a particular case. In

considering any approval in relation to politically motivated

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violence designed to influence the policies or acts of a State government the Attorney-General would no doubt consider the national significance of the case and any request for assistance by the State.

5.35 It is important to appreciate that the power so given to the Attorney-General would operate to limit the scope of the politically motivated violence which ASIO can now investigate, not widen it. The outer limits of the definition would be no wider than they are now. But the question how far in fact ASIO should concern itself with matters coming within the definition would, in view of the political nature of the judgment involved, be determined by the responsible Minister rather than by ASIO itself.

5.36 An example of guidelines in an area of this kind is

provided by the United States Attorney-General's guidelines for FBI 'Reporting on civil disorders and demonstrations involving a Federal interest' (see Appendix F). These guidelines, which provide an example of identification of federal interests, categorise federal interest in civil disturbances or demonstrations in terms of:

investigation of violations of federal criminal law; providing information and assistance to aid protective security of holders of high office; in the

providing information about civil disorders which may require the presence of federal troops; providing information about demonstration activities which are likely to require federal government action to facilitate the activity and provide public health and safety measures.

Protection of holders of high office 5. 3 7 Following the recommendation of the Protective Security Review, ASIO was designated by the Government in 1979 as the body solely responsible for providing threat assessments in the

96.

field of terrorism and politically motivated violence (5.14). Other Commonwealth agencies were required to direct any relevant intelligence to ASIO for this purpose. Under arrangements with police forces ASIO also obtains from them intelligence for the

purpose of its threat assessments.

5.38 ASIO prepares threat assessments as required in connection with the protection of holders of high office (referred to here as VIPs), whether Australian or international, or events (such as an international conference) for which the Commonwealth has or accepts some responsibility. Threat assessments of these

kinds are generally prepared in response to a request from the Commonwealth " s Protective Services Co-ordination Centre (PSCC). ASIO also prepares general assessments of the threat of

terrorism in Australia (e.g. the monthly report by ASIO to the Special Commonwealth Inter -Departmental Commit tee on Protect ion Against Violence, copies of which are also provided to State police) "

5.39 ASIO bases its threat assessments on information available to it from its own sources, overseas liaison sources and State and Federal police and government departments. ASIO passes the

assessments to the PSCC and to relevant police forces in advance of the event covered. (State and Northern Territor y police have principal responsibility for the safety of a VIP in their State or Territory with the Australian Federal Police playing a co-ordinating role or, in the Australian Capital Territory, the primary role) "

5.40 ASIO has thus under Governmen t direct ion assumed a

function which calls for it to have some foreknowledge of violent activity even though the function ma y not justi fy ASIO itself doing more, in a particu lar case, than intelligence provided by other bodies and producing

assessment based on that intelligence and other intelligence that ASIO may hold itsel f .

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receiving a threat

relevant

5.41 In practice, ASIO in its assessments draws on intelligence obtained from:

its own coverage of target persons in the politically motivated violence field;

from its own cover age of other targets, especially target groups in the subversion area (e.g. information picked up incidentally about demonstrational activities being organized by a target group or in which members of the

target group are planning to participate) ;

overseas liaison sources (which may be relevant for example to assessment of any threat to a visiting VIP);

the Australian Federal Police or State or Territory police forces.

5. 42 ASIO' s threat assessment role was proposed by me, and conferred on ASIO by the Government (5.37), in a general context of terrorism or other politically motivated violence of a serious kind. Fortunately in recent years the incidence of that kind of violence has been low. More often threat assessments will be concerned with the likelihood of demonstrators impeding the way of a VIP or subjecting the VIP to harassment or perhaps the throwing of objects which insult rather than injure.

5.43 In this context questions have been raised first about ASIO's ability to collect intelligence relevant to these matters itself and, secondly, about ASIO's authority to disseminate that intelligence in certain circumstances. Quite a large part of its intelligence about demonstrations has been collected as an incident to its coverage of groups regarded as subversive. To the extent that its coverage of these groups has been, or will be, reduced as a result of re-assessment of the status of previous targets, ASIO will acquire less of this incidental

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intelligence and will be less well informed about

demonstrational activity.

5.44 ASIO can still look to the AFP and other police forces for intelligence about demonstrations, and the view can be taken that as intelligence of that kind bears more on public order than on security its collect ion falls more properly to pol ice than to ASIO. Police forces have the advantage of being well represented throughout the community but generally they do not have access to the same intrusive means of intelligence

collection as ASIO and may therefore not be able to collect intelligence of the same quality as ASIO.

5.45 Another aspect of the problem is that, even where

intelligence about demonstrations is passed on to ASIO by the police, the receipt, assessment and dissemination of that intelligence, at least where no violence or subversion 1s involved, may fall outside ASIO's statutory powers. Intelligence

about non-violent demonstrations or incidental non-politic ally motivated violence may be relevant to protection of the VIP but may have a tenuous if any link with ASIO' s areas of security

interest.

5.46 ASIO has stated to me that it does not seek to extend its role in relation to the provision (far less the collection) of intelligence on possible spontaneous acts of violence in street demonstrations by non-ASIO targets, or on acts of harassment which may be offences but are not matters of proper interest to a security service, e.g. painting slogans or throwing of fruit

and eggs. Again, that restraint on the part of ASIO is

understandable, but the question really turns on what is properly expected of ASIO by the Government in the context of ASIO's statutory powers.

5.47 I have no doubt that those responsible for the protection of VIPs have a legitimate interest in being forewarned of the likelihood of non-politically movitated violence or of

9 9.

harassment or physical interference by demonstrators. A foreign dignitary visiting Australia should be protected against any violence, even if it stems from a personal grudge or an

unbalanced mind. The same consideration applies to Australi an dignit aries. The jostling of a person, or the throwing of a piece of fruit, can raise apprehension of possible serious harm, as well as constituting an assault or battery, apart from any

indignity or inconvenience that may be caused.

5.48 That is not to say, however, that the general interest in being forewarned (as opposed to having reasonable grounds for believing that violence may occur) is sufficient in itself to justify the use of intrusive intelligence collection techniques.

(In this regard I note that there may be cases, such as perhaps the recent tragic series of attacks on Family Court judges, where it is not known whether the motive of the attacker or attackers was political or personal . Where there is a reasonable apprehension of political motivation I would see no difficulty

in ASIO being authorised to obtain intelligence bearing on the matter notwithstanding the present definition of 'terrorism'. If my recommendations in this Chapter are adopted, there would be

no difficulty in ASIO pursuing that course, assuming that the Attorney-General designated Family Law judges as office holders for the protection of whom ASIO is authorised to collect intelligence).

5.49 The

protection general of VIPS

interest in being

of those

forewarned responsible for the of the likelihood of

harassment or physical interference by demonstrators does mean though that any centralised system of providing threat assessments should be able to take account of any available intelligence about 'low-level' demonstrational activities as well as intelligence about more serious threats of violence.

5.50 If ASIO is to retain its present responsibility in regard to threat assessments I suggest that the appropriate course would be to empower the Attorney-General to designate, in

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II

II

I

addition to the internationally protected persons already refer red to in the definition of terrorism, other per sons or classes of persons, foreign or Australian, in respect of whose ∑protection from threats or danger ASIO would have a role. It

would then be appropriate for the Attorney-General to issue

guidelines on the extent to which ASIO should actively seek to

collect intelligence itself, beyond intelligence gained incidentally from targets justified on other grounds, and as

distinct from receiving and assessing intelligence from police sources.

5.51 The intelligence which might properly be collected by ASIO

itself would not necessarily cover the whole of the intelligence which it would be appropriate for ASIO to deal with in a threat

assessment in relation to a VIP. In particular it would not generally extend to demonstrations or other activity which might interrupt the activities of a VIP but which did not involve any threat of violence (in some cases ASIO will collect intelligence of that kind in the course of investigating whether or not the

activity was of a more serious nature). Nevertheless, it would be reasonable to expect the police to pass to ASIO any

information about activities of that kind, as an assessor needs to take into account all information which, considered with

other relevant information, could bear on a threat. The receipt

~ ASIO of such information from the police could be regarded as

reasonably incidental to its security role in the making of

threat assessments.

5.52 It is reasonable too that ASIO, even if it assesses

informati on about demonstrations or like activity as having no serious implication, should pass it on to the authorities

responsible for the protection of the VIP. This is because the

information could still bear on their planning for the VIP' s

Protection. If there be a doubt about ASIO's right to pass on

such information, an appropriate amendment should be made to

s.l8 ( 3) (i.e. enabling AS IO to pass on to the PSCC or pol ice

101.

forces, as appropriate, information which relates or appears to relate to planning for the protection of VIPs) "

5.53 The alternative to providing clearer legislative support for ASIO in carrying out its present sole responsibility for the provision of threat assessments is to take that role away from ASIO. This task could be given to the Australian Federal Police,

or perhaps the PSCC, with ASIO and State and Territory police passing any relevant intelligence they had on to that body (the AFP was in the process of being formed at the time of the

Protective Security Review) " I see this option as one that is open for the future, although it could involve considerable problems at the present time. At this stage I go no further than suggesting that ASIO's authority needs to be clarified.

Proposals for changes in definition 5.54 In Chapter 4 I recommended that s.5 of the ASIO Act 1979 be repealed and that certain activities previously regarded as subversive be included in a definition of 'politically motivated violence'. I recommend that:

(a) the expression 'politically motivated violence' should be substituted for 'terrorism' in the definition of 'secur ity' in s.4; (b) 'Subversion' should be deleted from that definition;

(c) in place of the definition of 'terrorism' there should be inserted a definition of 'politically motivated violenc e ' which includes the following activities in that descriptio n:

(i)

( i i)

(iii)

Terrorism; (The new description of activities previousl y described as subversive in s.5(1) (a)) (see 4.9l(c )); Acts of violence for the purpose of achieving a political objective in a foreign country (includin g the influencing of the policy or acts of the government in that country) and training, planning, preparation or other activities for the purposes of

102.

carrying out any such acts of violence in a foreign country; (iv) Acts that threaten or endanger persons protected by the Crimes (Internationally Protected Persons) Act

1976 or persons who are visiting Australia or are the holders of public office in Australia and are designated, either generally or case, for the purposes ∑ of this Minister;

in the particular paragraph by the

( v) Acts that are offences punishable under the Crimes

(Hijacking of Aircraft) Act 1973 or the Crimes (Protection of Aircraft) Act 1973; (vi) Other acts of violence for the purpose of achieving a political objective in Australia (including the

influencing of the policy or acts of the Australian Government) where the acts of violence are of a kind, or the purpose is one or one of a kind, that have been designated, either generally or in the

particular case, for the purposes of this paragraph by the Minister;

I f it is decided to treat the activities now described in

s . 5 (1) (c) as a form of politically motivated violence, there

should be added to the list a paragraph 1n terms of that

p rovision, but omitting the words 'or hatred' (see 4.9l(f)).

5 .55 I recommend also that:

(a) There should be included in s. 4 a new definitio n of

'terrorism' to the following effect:

'Terrorism' means acts or threats of violence or harm intended or likely to cause fear in order to achieve a

political objective in Australia or in a foreign country (including any such acts or threats of violence or harm for the purpose of influencing the policy or acts of a

government in Australia or in a foreign country) ;

103.

(b) Section 18(3) should be amended, if existing powers are not adequate for this purpose, to ensure that ASIO can pass on to the responsible authorities information which relates or appears to relate to planning for the protection of VIPs.

(c) The Attorney-General issue guidelines on the extent to which ASIO, on the basis of its assessment role in relation to the protection of VIPs, should seek actively to collect intelligence itself, beyond intelligence gained incidentally from other targets and as distinct from receiving

intelligence from police sources.

5.56 The purpose of these proposals is:

(a) to separate true terrorism from other acts of political violence; (b) to incorporate in the designated violent activities the activities previously treated as subversive, but defined in 1 a more limited fashion; (c) to confine within limits to be designated from time to time

by the Attorney-General the non-terrorist political violence 1 in respect of which ASIO has and should continue to have an intelligence role; and (d) to clarify the classes of VIP " s in respect of whose safety

ASIO has an intelligence role and ASIO's ability to carry

out adequately its present role in providing the sole threat assessments in relation to VIPs.

ASIO'S ACTIVITIES IN RESPECT OF POLITICALLY MOTIVATED VIOLENCE Targetting 5.57 The primary objective of ASIO's present operations in

relation to terrorism is to gain forewarning of activities, o particularly acts of violence, that fall within the statutory definition of that term. It does this by identifying groups in Australia that have been associated directly or indirectly with violence in Australia or overseas and then, through

104.

~ nvestigation, by identifying the individuals within those

~ r oups who are potentially violent.

~ 5 .58 There is ample evidence that such groups and individuals

1cdo exist in Australia. Inforrna tion of a general nature

" concerning violence-prone groups within the Australian community

is contained in ASIO' s published Annual Report of 1983/84 at

"paragraph 27. What real terrorism there has been in Australia

"has been 1∑ n response to f ∑ ∑ d ore 1gn 1ssues an , fortunately, there

are no Australian terrorist groups whose objectives are directed

against the Australian people or governments, except to the

extent that the violence used against Family Court judges in recent years can be regarded as terroristic acts.

5.59 Target groups or individuals are assigned, after

assessment by ASIO, to o~e of three priority categories:

(~ Prioritv One (representing a high terrorist threat)

Targets which: (i) have been implicated in recent terrorism, or (ii) are assessed to pose a current terrorist threat;

(b) Priority Two (posing a moderate threat)

Targets ( i)

(ii)

which: have been either implicated in terrorism in the past or are assessed to have a propensity for terrorism in the future, and are linked to terrorist groups active overseas or

are otherwise subject to overseas influences which may provoke terrorism here;

(c) Priority Three (low threat)

Targets ( i)

(ii)

which: have been either implicated in terrorism in the past or are assessed to have a propensity for terrorism in the future, or

are linked to terrorist groups active overseas or are otherwise subject to overseas influences which may provoke terrorism here.

105.

!

5.60 The aim with priority one and two targets is to achieve, or maintain, a position from which ASIO can predict and, through 1 advice to appropriate authorities, counter terrorism. In 111

relation to priority three targets, ASIO accepts that it has little chance of prediction, but relies on its coverage ta: 1 facilitate a rapid reaction to an incident or increased threat.

5.61 ASIO's targetting in the terrorism area is more dynamic than it is in relation to subversion. In any twelve month ~ period, new targets will emerge in response to local or overseas∑ developments, existing targets will be dropped and prioritie s will change.

5.62 Changes of this kind call for a considerable degree o E ' organisational flexibility not least in being able to redirec t: resources quickly to cover changes in priori ties. I have found! that the rapid re-direction of resources, particularly staf E resources, needed in this area has been a problem for ASIO. B recommend that, in the context of overall improvements in ASIO' ~ resource allocation processes, particular attention be given ta the readiness with which adequate resources can be provided tq meet newly emerging demands of high priority in the field of3 .Politically motivated violence.

5.63 As regards public protests and demonstrations I hav ~ already referred to ASIO's guidelines on the coverage of mas issues, and have made recommendations for the amendment of theiJ ASIO Act in relation to non-terrorist politically motivated violence. What targetting has occurred in this area in recent years has generally been based on some specific matter of security interest such as subversion or, where some reason have not been able to provide

intelligence, the protection of VIPs.

106.

the police for I

the necessar y

' ~ 5.64 If the basis of investigation is subversion, the

ucategories of 'subjects of investigation' and 'targets' are used

(4 .106) , but not in other cases of politic ally motivated

∑violence. While the special and often urgent nature of true∑

terrorism may make this categorisation of targets less

appropriate, and may call for a full 'target' investigation at

once, without a preliminary, less intensive, inquiry, I

nevertheless see merit in retaining the category of subjects of

investigation as an available classification in this as in other areas of ASIO's investigative functions particularly for

non-terrorist activities, as paragraph 3 of the guidelines on

mass issues indicates (Appendix E).

5. 65 The drawing of

whose security status assessed to pose a

a distinction between persons or groups

is still unclear, and those who are threat is

discipl ine. As discussed in

to security, Chapter 6, the

a necessary

drawing of a

distinction between preliminary inquiries and a general

invest i gat ion is a 1 so i mpo r tan t " ..::I_..::r.....:e.....:c::.....o _m_m...;.:..:.e::.....n.....:d_ .....: t::.....h.....:a::.....t __ t_a_r....::g:._e_t_t_1_∑ n~g procedures in the politically motivated violence field should be

subject to the general guidelines, proposed in Chapter 6, and

distinguish between inquiries of a 'preliminary' and a 'full'

kind and between 'subjects of investigation " and 'targets'.

Operations

5.66 The collection of intelligence about politically motivated

violence is generally regulated by the intelligence collection program system which is described in Chapter 6. Sometimes events

may happen so quickly that full investigations have to be

carried out before there is time to formulate the program. Where

an intelligence collection program (ICP) in respect of terrorism 1

has been adopted and issued, it may differ from the usual I CPs

in that it may .not be directed to a person or an organisation.

It may be directed to what may be called a movement, or to a subject matter, such as terrorism relating to a particular

ethnic group. !CPs in respect of non-terrorist politically

107.

motivated violence are generally directed to persons or organisations.

5. 6 7 Operations in respect of politically motivated violence, not amounting to terror ism, are similar to those undertaken in respect of subversion. It should be noted that although ASIO officers used demonstrators as they no longer

have taken.

to take photographs of demonstrations and recently as 1980, they no longer do so, and obtain copies of photographs which police may

5. 68 The running of agent operations in the terrorism area poses particular problems. (More general aspects of agent operations are discussed in 6.46 6.54). Collect ing

intelligence about terrorism is fraught with difficulty. The modern terrorist, particularly if he or she has internationa l connections, is likely to be sophisticated, well-traine d, dedicated and security-conscious. Plans for terrorist operations

are likely to be closely guarded secrets known to very few people other than those directly involved. For ASIO to recruit an agent with access to such secrets is no easy task.

5.69 ASIO has submitted that general guidelines could not be formulated to deal with the complexity and diversity of circumstances that can arise in the management of agents in terrorist or potential terrorist groups. It states that these matters are dealt with on a case-by-case basis with decisio ns made at a senior level.

5.70 In my view the framework for ASIO 's operations in this area, based on decisions made in significant cases, alread y provides a basis for development of guidelines, which might be laid down by the Attorney-General. These guidelines should address among other things the instruction of agents not to participate or otherwise assist in acts of violence or breaches of the law and not to initiate plans to commit criminal acts or use unlawful techniques to obtain information for ASIO.

108 0

Guidelines of this kind are in force in the United States in relation to the FBI.

5.71 The recent decision of the High Court of Australia in A and Others v.

highlights the Hayden and Others (unreported 6 November 1984) fact that 'the executive has no power to

authorise a breach of the law' (per Gibbs C.J. p.2).

5.72 Very careful consideration needs to be given in any guidelines to the propriety of particular conduct on the part of ASIO or by an agent with its blessing. Regard also should be had

to the possible implications of particular action for any prosecution that might arise from conduct engaged in by the target group. For example, in a case in the United Kingdom Lord Widgery, Chief Justice, observed that:

" " " in these days of terrorism the police must be entitled to use the effective weapon of infiltration. " ". and common sense indicates that if anybody infiltrates a

suspect society, he has to show a certain amount of

enthusiasm for what the society is doing if he is to

maintain his cover . " " Accordingly, one must expect . ". that the intruder who penetrates the suspect organisation does show a certain amount of interest and enthusiasm for the proposals of the organisation even though they are unlawful. But the intruder . " " must endeavour to tread the

somewhat difficult line between showing the necessary enthusiasm to keep his cover and actually becoming an agent provocateur, meaning thereby someone who actually causes offences to be committed which would otherwise not be committed at all.

(R. v. Mealey and Sheridan (1975) 60 Cr. App. R. 59, at

61,62).

5.73 The chances of ASIO agents in the area of terrorism being privy to information relevant to the investigation of criminal offences are high. The question of ASIO's communication of information to police and other authorities is discussed in Chapter 8.

5.74 Another matter that should, I believe, be addressed in the guidelines is the question of the position ASIO takes when it becomes aware that it is privy to information that may have a

109.

bearing on a criminal prosecution or a commission of inquiry or some other legal proceeding, which is then either proceeding or likely at some time in the future to proceed. Cases of that kind may give rise to difficult judgments. I do not think it is

appropriate that any such matter should be considered and decided by ASIO alone. In my view guidelines should provide for ASIO to consult with the Attorney-General's Department on any

such case.

5.75 I recommend that:

(a) guidelines be prepared and laid down for the benefit of ASIO staff, addressing particular problems that can arise in relation to agent operations in the politic ally motivated violence field {see also 6.54); (b) that the Attorney-General require ASIO to consult with his

Department in regard to any information it may hold which may appear to be of possible relevance to a criminal

prosecution, commission of inquiry or other legal proceeding.

Threat assessments 5.76 Of all ASIO's activities, that of providing threat assessments is one of the least contentious. Few would disagree with the proposition that planning preventive measures against politic ally motivated violence is made easier and more effectiv e by advance warning. Until recently at least, the agencies for whom these assessments are prepared appear to have been

generally satisfied with their quality and usefulness, although a view has been expressed that they should be more detailed and

informative. State police forces in particular have remarked on the value to them of the monthly threat assessments prepared by ASIO.

5. 77 Recently ASIO has, in some cases, expressed the view that it is unable to give an effective threat assessment in respect of VIP visits or special events. This attitude has been based on what it regards as limitations on its ability to investigate or

110.

to target organisations which may be the source of a threat, particularly 'mass issue' organisations, arising from questions of legality or propriety. ASIO's statements have caused concern among some users of its threat assessments.

5.78 It is important to get a few things clear. First, no threat assessment from ASIO or anyone else can be more than a judgment based on the information available to the person making the assessment. No given amount of intelligence is required for the making of an assessment; but of course the value of the assessment is likely to be more or less according to the quantity and quality of the information on which it is based.

5.79 The amount of information available to ASIO may shrink (or grow) for any of a number of reasons. It may well happen that the withdrawal by ASIO from the targetting of a particular body will result in the loss of a source of information hitherto of

value in the making of threat assessments. That fact may be a matter for comment, in the sense of informing recipients of assessments that they are based on less information than was available previously, and it may be a reason for seeking from

police more assistance in the form of relevant information that may be available to them.

5.80 But whether or not ASIO's own previous source of

.information should be continued or revived depends, not on the value for threat assessments of information that can be collected incidentally from that source,but:

on whether that source is a legitimate target in terms of

security as defined in the ASIO Act; and

in relation to the use of intrusive means of intelligence collection, whether there are security grounds sufficient to justify the use of such means.

111.

The question is whether or not a particular body or person is a legitimate target for intelligence collection by ASIO, while the extent of any investigation, including recourse to the intrusive methods requiring the Attorney-General's warrant, depends, among other things, on the seriousness of the threat.

5. 81 ASIO should not seek to use its role in producing threat assessments as the justification for the collection of intelligence, or for the collection of intelligence by means, for which it has no independent justification.

5.82 Having said that, ASIO is entitled, under the existing definition of 'terrorism' to investigate any organisation which it has reason to believe may be the source of violence for political purposes, including the violent assault of VIP' s and

the violent interruption of their activities. The Government, including relevant departments and bodies such as the PSCC, are entitled to look to ASIO for intelligence about threats of this kind, in the form of threat assessments or otherwise.

5.83 It is both lawful and proper, and indeed it is its duty, for ASIO to obtain such intelligence as it can for this purpose from its authorised targets and by authorised means. To the extent that ASIO cannot obtain relevant information from its own sources, it may be able to obtain such information from pol ice sources. The same position would apply if my recommendations about designated VIPs are accepted.

5.84 In the end, ASIO can do no more, and cannot be expected by the Government to do more, than give an assessment on the basis of the available information, pointing out, where appropriate, the limits on the extent of that information.

ASIO's role in counter-terrorist arrangements 5.85 ASIO participates in the arrangements that have been developed by the Commonwealth, the States and the Northern Territory for the planning and co-ordination of

112.

counter-terrorism measures under the umbrella of the Standing Advisory Committee on Commonwealth/State Co-operation for Protection Against Violence (SAC-PAV). SAC-PAV was established to ensure " nationwide

relevant Commonwealth, readiness and co-operation between State and Terri tory government

departments, police forces and, when appropriate, the Defence Force, for the protection of Australia from terrorism ".

5. 86 ASIO is a member of, and provides security intelligence,

threat assessments and protective security advice to, the Commonwealth's Special Interdepartmental Committee on Protection Against Violence (SIDC-PAV) which has on it representatives from a number of departments and agencies. Monthly threat assessments

prepared by ASIO for SIDC-PAV are made available to State and Territory police forces as well. A number of senior police officers remarked to the Commission on the value of these assessments (which provide intelligence on national and

international developments) and noted that the assessments were read by Commissioners and other senior officers.

5.87 ASIO is represented by an observer at meetings of SAC-PAV, the membership of which includes representatives from all States and the Northern Territory, including their police forces, and

from the Protective Services Co-ordination Centre and several

other Commonwealth departments and agencies. ASIO is a member of four of the five working groups that operate under SAC-PAV.

5.88 In response to a request from SAC-PAV, ASIO has developed and conducted, since February 1982, training courses for the

eight Australian police forces. The courses have been aimed at improving police intelligence skills in the context of anti-terrorist operations. Favourable comments were made to the Commission about these courses by several police forces.

113.

CHAPTER 6

COLLECTION OF INTELLIGENCE

General considerations 6.1 Information is ASIO's lifeblood; without the capacity to

obtain it the Organization could not discharge the functio ns Parliament has entrusted to it.

6. 2 ASIO collects information ('intelligence') by a variety of means that range from monitoring publicly available material such as newspapers and journals, through assistance from local and overseas liaison sources, to covert operations carried out, where required, under Attorney-General's warrant. ASIO also makes use of information volunteered by members of the public or obtained from them in interviews conducted at the Organization's

initiative.

6.3 Except in relation to some covert operations, the ASIO Act contains no restriction on the methods by which the Organization may collect intelligence. This means that subject to the Act and the general law, ASIO is left to judge how best to obtain the

information needed to discharge its functions.

6. 4 ASIO is, of course, confined by the Act to collect ion of intelligence relevant to its functions. Any consideration of additional intelligence

restrictions must take

on

into ASIO's capacity account the

to

impact collect those

restrictions would have on ASIO' s performance. That is not to say that ASIO should be given carte blanche; it is not now, nor should it be. But restrictions should be based on considerations other than simply the need to tie ASIO's hands. One such

consideration is the desirability of protecting the privacy of an individual's communications. This consideration underlies the

legislative restrictions that presently apply to the interception by ASIO of certain types of communications.

114.

6. 5 Moreover, ASIO cannot operate effectively without a broad data base. For example, evidence proving the occurrence of subversion, espionage or terrorism is hard to come by. What is more likely to come ASIO' s way is an assortment of information

of varying detail, precision and cogency that relates to the occurrence or non-occurrence of the activities concerned. It wou ld be absurd to require that AS IO should only collec t

information about a matter where, for examp le, it is satisfied that the matter constitutes or, with other information in ASIO's possession, proves subversion, espionage or terror ism .

6. 6 So it is that

obtain intelligence the ASIO Act permits

that is relevant to the Organization to protect ion of the

Commonwealth and its people from the activities specified in the definition of 'security'. 'Intelligence is releva nt to security if it can reasonably be considered to have a real connection with that topic, judged in the light of what is known to ASI O at

the relevant time' (Church of Scientology v Woodwa rd (1982) 43 ALR 587 per Mason J. at 602; see also Gibbs C.J. at 594, 595).

Of course opinions on whether an item of informa tion can

reasonably be considered to have a real relevance to security may differ. What is necessary is a mechanism for ensuring that

opinions on these matters within ASIO are soundly based.

6. 7 I describe below the way which ASIO currently pursues it s intelligence collection function and refer to procedures that apply, or have been proposed, in comparable overseas

intelligence agencies.

Intelligence collection programs

6.8 Most intelligence is collect ed within ASIO to me et

objectives laid down in intellig ence collection programs (ICPs)

wh ich are statements addressed to the Organization 's

collectors of the informatio n required concerning specifi ed organisations, individuals or subjects judged to be relevant to security. The !CPs are approved and reviewed annually by a

committee of senior Head Office offi cers chaired by the Deputy

115.

Director-General (the Operations Resources Group). That committee also approves all ministerial warrant applications to be placed before the Director-General .(legislation requires the Attorney-General to authorize the use by the Organization of

certain methods of intelligence collection namely interception of telephone, telex, telegram and mail, the use of listening devices, and entry and search of premises).

6.9 The ICP system is one of a number of changes introduced by ASIO to its intelligence collection and analysis procedures

following RCIS. Another was the greater integration of intelligence collection and analysis brought about by the creation of three new branches within Head Office: two subject-oriented intelligence branches with responsibility for both intelligence analysis and operational oversight within their respective target areas and an operational support branch.

(Prior to this there had been separate branches responsible for operations and assessment respectively). The regional offices were restructured to mirror the Head Office arrangements except that regional activities were restricted to intelligence collection.

6.10 The reorganisation, with concomitant changes in

procedures, provided for Head Office determination of intelligence collection objectives (through the !CPs which in practice are formulated in consultation with regional offices), joint Head Office/regional office consultation on the methods of attaining those objectives, and the delegation of authority and responsibility, including for financial aspects, to the regional offices for attainment of objectives over given periods. In practice, Head Office intelligence branches initially retained greater responsibility than was intended for operational administration and financial matters, but recent changes have sought to rectify this by devolving further authority to the regions.

116.

In addition to forwarding regular intelligence reports, "!.during the year covered by an ICP, the regional off ices provide

ead Office with three progress reports and advise of any

and problems that exist. They also provide to the .relevant Head Office branch source management reports in which

_they outline the general progress with sources of intelligence

in respect of the various targets.

The ICP system is aimed at:

ensuring that only approved targets are covered and only specified information is collected;

stating the objectives of the Organization with respect to each target;

providing a formal means of negotiation and communication on the broad intelligence objectives and requirements between Head Office and the regional offices; and

establishing accountability. clear points of responsibi lity and

6.13 In considering how far these aims have been achieved, the

∑∑ first thing to note is that regional off ices are not restricted

∑∑ to the collection of information relevant only to ICP

0 objectives. They are permitted to exercise judgment in the

' Collection of non-ICP information that is nevertheless relevant

to security, but are expected to forward it immediately to Head

Office.

6∑14 An example might be where a member of the public reports to a regional off ice a meeting of people in Nazi uniforms∑ The

regional office could, without reference to Head Office, make

inquiries to det∑ ermine the accuracy of the report and r assuming it was accurate, to identify the individuals involved. However,

any further investigation of the individuals would need to be

117.

approved by Head Office and be made the subject of an ICP if it looked like continuing for any appreciable time.

6 .15 Regional offices may also be tasked by Head Office to

collect information not required by an ICP. This may occur wh ere a matter of security interest, not covered by an exist ing ICP,

comes to the attention of a Head Office intelligence branch and in its view requires some investigation.

6.16 The specificity of information collected under an ICP depends on the specificity of the objectives stated in the program. Some ICPs 1nclude separate statements of AS I0 1 s 'general objectives' in relation to the target and of AS IO 1 s

1

requirements', that is, the information or tasks expected of the regions. Some summarise the regional situation in relation to the target. Many refer to the methods by which the requir ed information should be collected, either within the

'requirements' or separately under the heading 'recommended methods'. None argues a case for investigation or continued investigation in terms of the definition of 'security' in the ASIO Act.

6.17 In my opinion the ICPs issued by Head Office inte lligence branches should be much simpler and shorter documents than at present. They should state precisely and briefly the kind of information required to be collected about the target or area of interest with an indication of priorities. They should not contain summaries or assessments of information already collected, nor should they deal with methods or strategi es for collecting the information. Both these matters can and should be dealt with separately; in the case of assess ments, through background papers, and in the case of operational strategy through established policies and procedures that specify where responsibility lies for operational decisions.

6.18 I recommend changes in the form and content of the ICP 's along the lines proposed in the preceding paragraphs.

118.

,E .l9 I am of the view that the regional progress reports could

a t least be reduced in frequency. A balance needs to be struck

floetween the imposition of 'paperwork' on the regional off ices

a nd interes t in imbuing those offices with a continuing sense of

accountability for progress in fulfilling the ICP 's. The

p erformance of regional offices in meeting collection objectives

c an sometimes be adequately assessed in the annual review of the

~ C P 's. I recommend that ASIO review the need for or the

d esirable frequency of ICP progress reports.

f6. 20 The ICP system has not, in practice, resulted in a clear

d ivision of responsibility between Head Office and regional

~ f f ices. Head Office retains greater responsib ilit y in

~p erational matters (e.g. interviews, agent recruitmen t and

~ayment) than was envisaged when the system was introduced. This

:Jhas contributed to tensions in the relationships between Head

()ffice and regional offices which were highlighted in a series

iof internal management reviews conducted in 1982.

6.21 New arrangements instituted in October 1983 have given

" greater authority to regional directors for agent recruitment

and sensitive interviews (e.g. journalists, publi c servants,

academ ics}. Revised instructions relating to operationa l finance

have been prepared. Despite these changes, the Head Office

intelligence branches continue to be involved in operational matters, particularly through their 'operational offi cers' wh o

are supposed to maintain liaison with the regional office on

such operational matters as source management, finance and

surveillance action.

6.22 There has been some criticism w ithin the Organization that

responsibility for performance under the ICP system has been inadequate. It is said that some regional offices have repeatedly failed to meet ICP objectives without the responsible

officers being brought to account. Sometimes, wh ere Head Office desk officers have not perfor me d the duties required of them,

measures have not been taken to improve their performance. I

119.

regard these problems, if they exist, as ones of management; they do not represent deficiencies in the ICP system as such.

Review of targets 6.23 While the ICP system is a considerable improvement on previous procedures for controlling and directing ASIO' s intelligence collect ion activities, it has not ensured rigorous attention by ASIO to the justification for opening

investigations and the regular review of that justification in individual cases. There is insufficient indication, in some areas in particular, of careful consideration of these matters by reference to the statutory charter of the Organization.

6.24 I have already referred to the United States

Attorney-General's guidelines governing domestic subversion/terrorism investigations by the FBI (4.27 and Appendix D). They provide criteria for the initiation of such investigations, and specify the approval required, the kind of

information that may be collected and the methods that may be used. The approval required is that of the Director or designated Assistant Director of the Bureau. Notification of the opening of an investigation is required to be made to the Office of Intelligence Policy and Review in the Department of Justice. The Attorney-General may at any time request the FBI to provide a report on the status of the investigation.

6.25 An investigation may be initially authorised under the guidelines for a period of up to 180 days and may be continued upon renewed authorisation for additional periods, each not exceeding 180 days. Investigations are to be reviewed by the Director or designated senior officer of the Bureau on or before

the expiration of the relevant authorisation period. Additionally, each investigation must be reviewed at least annually by the Bureau and the Justice Department to ensure that the criteria justifying investigation are still met.

120.

6.26 The guidelines provide that, in pursuing investigations under them, the FBI may use any lawful investigative technique

in accordance with any requirements for use set by statute,

departmental policies and Attorney-General guidelines. Before employing a technique, the FBI should consider whether the information could be obtained in a timely and effective way by

less intrusive means.

6.27 Reference can also be made to similar guidelines

recommended by the Commission of Inquiry concerning certain activities of the Security under the Those guide lines

Commission thought

Royal Can ad ian Mounted Police (Freedom and pp 514-527). Law, are

2nd Report, based on

Vol

five 1, 1981, principles that

should govern intelligence collection the

by a

security agency. They are:

the rule of law must be observed;

the investigative means used must gravity of the threat posed and occurrence;

be proportionate to the the probability of its

the need to use various investigative techniques must be weighed against possible damage to civil liberties or to valuable social institutions;

the more intrusive the technique, the higher the authority that should be required to approve its use;

except in emergency circumstances, the least intrusive techniques of information collection must be used before more intrusive techniques.

6.28 There is a question whether ASIO's intelligence collection activities should be subject to further legislative constraints or to executive guidelines of the kind discussed above.

121.

6.29 I am conscious of concern within the community that in exercising judgments of what is 'relevant to security' ASIO may collect and store too much information about too many people without sufficient justification. My view is, however, that

further legislative constraints are unnecessary; legislation already lays down the outer limits of ASIO's intellige nce collection activities.

6. 30 On the other hand, I think that the public interest and ASIO itself would be better served if the Attorney-General were

to issue guidelines to govern the practical application of the phrase 'relevant to security' to ASIO' s intelligence collect ion function. Those guidelines could provide criteria for the opening of both ICP-related and non-ICP related investigations, specify the approval required for each, the period for which investigations may run, and the need for review of them.

6.31 I have given particular consideration to whether the guidelines ought to involve the Attorney-General or his department in approving the opening and the continuation of investigations by ASIO, at least those pursued in accordance with ICP's. A decision to conduct an investigation affects the privacy of individuals and involves expenditure of public moneys. It should not be taken lightly. The participation of

someone from outside ASIO would provide an additional and impartial perspective on the issues involved, in particular whether investigation was justified in terms of the Act and the Minister's guidelines.

6.32 On the other hand, the Organization should, through its Director-General, be primarily responsible for discharging it s statutory functions. Any move to disperse this responsibi lit y makes ASIO less accountable for its operational decisions and

shifts responsibility to those who, particularly in the case of the Minister, lack the time and background knowledge necessary for making those decisions.

122.

i6. 33 Moreover, while there should be a closer relationship

~between the Minister's department and ASIO, I do not think that

∑ the department should have what could amount to a power of veto

in relation to operational decisions. Such a power would result

in the Organization becoming a mere appendage of the department.

6.34 The Attorney-General should be kept informed regularly of

ASIO investigations

'targetting' activity,

the results of reviews

undertaken pursuant to ICP's (i.e. and as opposed to preliminary inquiries)

should specify an of those appropriate investigations.

notification The guidelines procedure. The

Attorney could then, if necessary, seek further explanations and information from ASIO or refer any query to the department for investigation or advice. This will strengthen the Minister's knowledge of what the Organization is doing, without his taking on the additional burden of personally authorising all of ASIO's

significant investigational decisions.

6.35 It is to be remembered that legislation already requires

the Attorney-General to authorise ASIO's use of particularly intrusive methods of intelligence collection with the exception of human sources. A

intelligence collection further significant activities would be check on ASIO's

ASIO's activities by the propose in Chapter 16.

the

Inspector-General whose scrutiny appointment of

I

6.36 The guidelines should provide for the undertaking of

preliminary inquiries, perhaps on the approval or direction of a regional director or Head Office branch head. They should allow for the continuation of a preliminary inquiry beyond 90 days only where a special case is made out and Head Office approves. Any decision to extend a preliminary inquiry should be notified

to the Attorney-General. The purpose of a preliminary inquiry should be to determine whether there is sufficient evidence of activity 'relevant to security' to justify a more active, though not necessarily a more intrusive, investigation.

123.

6.37 It is important that preliminary inquiries should not be allowed just to run on indefinitely. The emphasis should be on reaching a decision, one way or the other, whether the subject warrants investigation by the Organization. For that reason I see notification to the Attorney-General of decisions to extend such inquiries as an important element of min isterial oversight. He (or his Department for him) should be in a positio n to

question and test the reasoning behind a particular decision and, if necessary, to give a direction.

6.38 The second type of investigation could be termed a general investigation and would require approval of the De puty Director-Genera l through the ICP process. Provision should be made in urgent cases for initiation of such an investiga tion

before that process is carried out. A general investiga tion could be conditional on the existence of facts or circumstan ces reasonably indicating the possibility that activi ties prej ud ic ial to security have taken place, are taking place, or will take place. It could commence without a preliminary inquiry

if the n ¨=essary factual basis existed. The focus of the investigation could be a person or group of persons. Its intensity could vary from a low-level watch to a full

investigation involving the entire range of intrusive techni ques.

6.39 The progress of a general investigation should be reviewed annually within ASIO (with any continuation requiring specific authorisation by the Deputy Director-General) . The purpose of such reviews would be to determine whether continued

investigation, of whatever kind, was justified in terms of the ASIO Act. The Attorney-General should be kept infor med on a

regular basis of the initiation or continuance of general invest igations. Again, the Attorney-General would be able to question decisions and, if necessary, to give a directio n. It should be part of the Inspector-General 1 s role (see Chapter 16) to check ASIO 1 s compliance with the guidelines for the conduct of investigations.

124.

6.40 I am conscious that in practice the distinction between preliminary inquiries and general investigations will not always be clear, and that in some areas of ASIO 1 s work there may be

less call for a preliminary stage than in others. I see very real advantage nevertheless in a process of the kind proposed. It should bring about a more deliberate, disciplined and rigorous approach to the opening and closing of investigations. The two levels of inquiry, which could be reflected in the designation of the files used, would help too in maintaining consciousness of the status of an investigation.

6.41 In my view the guidelines should indicate, without prescribing, the kinds of investigative techniques that may be employed at each stage of an inquiry, subject always to an injunction in favour of less rather than more intrusive

techniques.

6.42 The expectation would be that in preliminary inquiries the emphasis would be on collection of information from publicly available sources of information, or from other established contacts and agent sources. One cannot rule out that more

intrusive techniques might be warranted in a particular case. Where these involve the use of the special legislative powers,

the Attorney-General 1 s consent will be required in any event. Justification for the recruitment and use of an agent would I think be exceptional, but never the less possible, for the purposes of a preliminary inquiry provided it was taken at a

high level in the Organization. Such a decision would be open to scrutiny by the Inspector-General.

6.43 Overall, I believe the guidelines should aim to provide a structured process, designed to produce careful and justifiable decisions on opening and closing investigations, and on the use of particular collection techniques, without being so inflexible

as to straight-jacket the Organization.

125.

6.44 I referred in Chapter 4 to the distinction drawn, in the subversive studies area, between 'subjects of investigation' and 'targets' (4.106). Such a categorisation could usefully be introduced across the range of ASIO's investigations. A subject of investigati on would be a person or organisation which is being investigated whether in the course of a preliminary

or a inquiry whether security. that

A

organisation

general investigation - with a view to determining person or organisation constituted a threat to target on the other hand would be a person or

assessed by ASIO to pose such a threat. Such a

categorisation would serve to focus and reinforce the continuing evaluation which is required in ASIO's work and help to keep in mind the not inconsequential difference between being in one

category or the other. The guidelines should provide for categorisation along these lines.

6.45 I recommend that guidelines should be formulated and laid down by the Attorney-General for the initiation, carrying out

and review of inquiries and investigations along the lines discussed above (6.30-6.44).

Human sources 6.46 Of all ASIO's intelligence collection techniques, the use of human sources continues to be one of the most, if not the most, important. Those sources may be 'agents', 'contacts', or members of the public who, from a sense of duty or other

motives, volunteer information to ASIO.

6.47 As was explained in RCIS (4:1 174-176), 'agents' are briefed and paid by ASIO to penetrate organisations (if they are not alread y in position) or to form associations with people, and to pass to ASIO information which they have obtained within the terms of their brief. They are presumed to be under ASIO' s control and direction. 'Contacts' are persons who are already in a position to give ASIO information which they obtain in the

ordinary course of their activities, and have agreed to do so. They do not set out to get information which does not come to

126.

I

1/ 1

II

them in that way. They are generally not paid, and are presumed

not to be under ASIO's control or direction but may in practice be told what information ASIO is seeking.

6.48 The deployment of agents to penetrate organisations and to report clandestinely on the statements and activities of persons is intrusive of the privacy of those reported upon. The degree of intrusion is not quite the same as that involved in the covert interception of telephonic or other communications. The deployment of agents does involve a deliberate course of deception to gain access to information that might not otherwise be obtainable. However, it does not involve an interception of a

presumed private communication; it is analogous to a party to a telephone conversation, or the recipient of a letter, repeating the contents of the communication to another.

6.49 The Commission of Inquiry concerning certain activ ities of the Royal Canadian Mounted Pol ice recommended that the

Minister's approval of an investigation should be required before an intrusive technique such as the planting of an undercover agent could be employed (Second Report Volume 1, p.525). This recommendation was not taken up in the provisions

of the Canadian Security Intelligence Service Act 1984.

6.50 I have concluded that it would be impracticable to require the Attorney-General's warrant for the deployment of an agent. This does not mean that the use of agents should not be subject to appropriate controls. Having identified an organisation as a

proper subject for investigation or as a whether it is necessary and proper to use intelligence concerning that organisation matter requiring considerable judgment.

(6.42), the guidelines on the conduct of

target, the question an agent to collect

or its members is a

As indicated above

investigations should

address the authorization of agent operations and a decision to carry out an agent operation would be open to examination by the proposed Inspector-General.

127.

6.51 It would no doubt be proper for ASIO at times to report to the Attorney-General about particular agent operations, and of course the Attorney-General would be entitled to require information if he thought it proper to do so. It would be a rare case though for it to be proper for the Attorney-General to

require or to be given the name of an agent. As it is important that as few documents as possible should be held outside ASIO identifying organisations in which ASIO has agents, much

reporting about agents should be oral, or by documents which are retrieved by ASIO as soon as practicable. The leaking of such a document could not only compromise ASIO's activities, but could also endanger its agents~

6.52 A question that needs to be addressed is agent protection. The ability to assure an agent of anonymity is critical to the recruitment of agents. Agents often act at considerable risk to themselves, and for limited if any reward. They are entitled to ASIO's assurance that it will do everything within its power to protect them from disclosure.

6. 53 Another aspect of agent protection is action to be taken in the event that an agent's identity is disclosed, whether inadvertently or as a result of a conscious decision such as a decision to call an agent as a witness in a prosecution. The appropriate steps to be taken in these cases should be formulated in general terms and, in some circumstances, should be discussed with the Attorney-General before their

implementation in a particular case. A preparedness by ASIO to take appropriate steps, which may involve considerable cost (as in police protection or re-establishing a person with a new identity), is essential to the maintenance of the confidence of agents. It is also a matter of good faith, on the part of not only ASIO but also the Government, on whose behalf ASIO acts.

6.54 I recommend that the

inquiries and investigations of agent operations, including:

Attorney-General's guiqelines on (see 6. 4 5) should address aspects

128.

a presumption against their use where less intrusive methods

of collection are available, but allowing sufficient flexibility to cater for the different circumstances that may affect the judgment whether to resort to use of an agent;

questions of legality or propriety that may arise in an agent operation (see also 5.75(a));

measures for the greatest possible protection of information relating to such operations;

the nature of guarantees that can be given about the protection of anonymity; and

measures that may be taken to protect an agent in the event of his identity being inadvertently revealed.

Warrant operations 6.55 Interception by ASIO of telephonic, telegram and telex communications requires authorisation by the Attorney-General under the Telecommunications (Interception) Act 1979. Similar authorisation is required under the ASIO Act for mail

interception, entry and search of premises, and installation of listening devices.

6.56 There is a clear understanding within ASIO of the

legislative requirements for the obtaining of warrants and careful attention is given to meeting those requirements. I ex ami ned the documentation for warrant operations, looked

closely at particular cases and spoke to many ASIO officers. In one case a telephone interception was inadvertently continued

for a day beyond its expiry. No other suggestion or indication of bypassing of the warrant requirements was found. I am satisfied that the provisions of both Acts have been complied with by ASIO.

129.

6.57 I also considered the requirements under s.31 of the ASIO Act and s.l4 of the Telecommunications (Interception) Act upon the Director-General, where he is satisfied that any record or copy of information obtained under warrant is not required for ASIO's statutory purposes or, in the case of s.l4, is not likely

to be required, to destroy that record or copy. The

Director-General is not obliged to destroy all material that is not required for ASIO' s statutory purposes, but only material which he is satisfied is not so required.

6. 58 There is a general consciousness of the requirements of s. 31, and in particular cases special care is taken to limit material produced from an intercept to what is required. Once material is produced, however, there is no regular process for

reviewing it and destroying material that is judged on review not to be required. In my opinion there is a need for procedures to formalise and clarify the handling of intercepted rna ter ial and, having regard to s.31, to introduce a process of review.

6.59 I recommend action by ASIO to lay down procedures

governing the processing and retention or destruction of intercepted material.

6.60 It is worth noting that fewer telephone interceptions and other warrant operations are carried out than is often popularly supposed. The Attorney-General told the Senate, in answer to a question upon notice on 28 February 1984, that the average annual number of warrants for telephone interceptions over the period 1974 to 1983 was 85.6 (Hansard p.75). I have given

details in Chapter 4 of the number of warrant operations in the area of subversion.

6.61 I have considered the question whether the warrant provisions number of

require amendment. Amendments were proposed in a submissions to me. One proposal was that the

provisions should be amended to require the Director-General, as well as the Minister, to form the requisite opinion justifying issue of a warrant. 130.

6.62 This proposal was aimed at removing the possibility of an Attorney-General pressuring a Director-General to request the issue of a warrant for purposes that do not relate strictly to security. This possibility is an example of the problems discussed in Chapter 16 in relation to s.B of the ASIO Act. That

secticn in recommend, concerning was used.

its present form, would apply to

any individual, no

and in the amended form which I

the collect ion of intelligence matter what method of collection

6.63 If the Attorney-General directed the Director-General to collect intelligence about an individual by means of a telephone interception, he would (if my recommendations about s.8 are accepted) have to put his direction, with reasons, in writing if

the Director-General disagreed with him on the quest ion whether the collection of intelligence about the individual was justified on security grounds. As a matter of practice the Director-General's application would also have to establish the grounds justifying the interception. There is accordingly no

need to make any special provision about collection pursuant to

warrant.

6.64 It has also been submitted that where a warrant is sought in relation to anticipated terrorist activity, the Director-General should be required to show to the Minister's satisfaction that there is a reasonable apprehension of the possible commission of a criminal offence, and a sufficient connection between the subject of the proposed interception and

that possible offence. In my opinion this submission

misconceives ASIO's role in relation to terror ism .

6.65 Unlike the police, ASIO's investigative focus is not generally on some specific and identifiable act. In this field the primary objective of an efficien t intelligence service must be to prevent terrorism developing beyond the incipient stage.

Achievement of this objective will require collection of a wide

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spread of intelligence about persons and organisations who, there is reason to suspect, may use violence for political purposes. Precise intelligence about the operational in tent ions of terrorists will rarely be available. In the absence of such intelligence, ASIO' s task will be to piece together a mosaic from information from a variety of sources which it is hoped will provide forewarning of the possibility of violence.

6.66 One such source is the information provided by telephone interception or listening devices which, if it does not include precise details of operational plans, may reveal membership and organisation of terrorist groups and the attitude of individual members towards violence. The use of these collection techniques

is of particular importance in investigating terrorism given the extreme difficulty of successful agent penetration.

6.67 It may be useful to provide an example of where ASIO's use of an intelligence collection technique required to be authorised by ministerial warrant would, in my view, be justified in the absence of a reasonable apprehension of the commission of an identifiable criminal offence. Suppose ASIO had received information from a international terrorist group

reliable overseas had established source secret

that cells an

in

Australia, but had been unable to corroborate this information. If ASIO knew the identity of the terrorist group's leading supporter in Australia, it would seem reasonable to me in these circumstances to allow ASIO to intercept that person's communications in an attempt to obtain information about the existence of secret cells whose purpose may be the planning or support of terrorism. It should not be assumed in such

circumstances that an Attorney-General would approve the use of telephone interception, or one of the other techniques for which a warrant is required, in the absence of convincing grounds for

doing so.

6.68 It has been submitted that the maximum initial duration of any war rant for interception should be 90 days, but with scope for renewal of a warrant. The present maximum is six months for 132.

listening devices, telephones, telex and telegrams, 90 days for mail interception and seven days for a search warrant. The

Canadian Security and Intelligence Act specifies a maximum of 60

days for investigations in relation to subversion and one year

in other cases. In the United States the Foreign Intelligence Surveill ance Act of 1978 specifies a maximum duration of one year for electronic surveillance of 'foreign' persons and 90 days in other cases. Title III of the Omnibus Crime Control and

Safe Streets Act of 1968, which regulates interceptions in other cases, provides for renewable periods of 30 days.

6.69 The desire to limit the duration of warrants for intrusive

investigative techniques, and thus to require the earliest

possible review of their just if icat ion, is understandable.

Howev er I consider that a general 90 days limit would impose unnecessary restraints and create practical difficulties

particularly in regard to reviewing the case for seeking an extension of the warrant. It would often be difficult to establish the nature of the activity authorised by the warrant after such a limited period. Indeed in some cases, not involving Australian citizens or permanent residents, there is a case for

the Attorney-General having a discretion to fix a period of

12 months.

6.70 A 90 day maximum may be appropriate in some cases, but it should not be imposed as a general 1 imi t. It is open to the

Attorney-General to 1 imi t a warrant to a period less than the maximum period. The present limits should remain save that I

recommend that consideration should be given to empowering the gtorney-General to issue war rants other than mail or search warrants for 12 months where the person whose communications are to be intercepted is not a citizen or permanent resident of Australi a.

Access to other records systems 6.71 This matter was dealt with in RCIS (4:1 152-158). I repeat the view expressed there that in considering any proposals for

133.

legislative guarantees of privacy in relation to informatio n held about persons by government agencies, account should be taken of ASIO's position and in particular ASIO's frequent need to obtain the full name, address, occupation and date of birth of a person for identification purposes.

6.72 ASIO may, for example,

person reported to be in

intelligence service or to

need to confirm the identity of a contact with a hostile foreign be associated with a terrorist

organisation. The identification process is important not only for confirming the identity of people who are of security interest to ASIO but also in avoiding the mistaken inclusion in that category of people who are not.

6. 73 _ 'Biographical' information of the kind that can assis t ASIO is kept by a number of government agencies - Commonwealth

and State. The ability to check information against such records systems is of the greatest importance to ASIO if it is to carry j out the tasks with which it is charged. In the absence of legislative prohibitions on its disclosure, I see no reason why / ASIO should not be permitted access to such information where it /1

has a particular need.

6.74 In practice, ASIO does gain access to information of this kind from other government agencies but the arrangements for so doing, and the ease of access, can vary even among the regional offices of a single Commonwealth department. In some cases the arrangements are formal, and in other cases they rest largely on personal contact between the ASIO officers who make the

inquiries and counter-staff with whom they deal.

6.75 As indicated, ASIO has a legitimate and important need for access to personal information of the kind held by certain other agencies. It is better that such access be on a clearly agreed basis, and that an agency approached for information should have an assurance that ASIO's request has been authorised at an appropriate level, than that these matters be left to informal

134.

arrangements between individuals in particular regions and offices.

6.76 I recommend that ASIO and those agencies which it

approaches from time to time for access to records systems should be directed to formalise arrangements, which should be

recorded in writing, governing ASIO's access. The arrangements should be worked out initially at ∑ a Head Office level and be implemented as appropriate on a regional level. The arrangements

could cover such matters as a standard form of request, the level at which the request should be authorised within ASIO, the

nature of the information that may be made available, and security aspects of any arrangements for the recording, in the agency responsible for the records system, of such requests or of information provided in response to them.

Collection of foreign intelligence in Australia

6.77 It is perhaps an oddity that there is no provision in Austral ian legislation enabling foreign intelligence, which it

is in the national interest for Australia to acquire, to be collected in the ways in which ASIO, if it has a wa rrant from the Attorney-General, can collect intelligence relevant to security. By foreign intelligence I mean information concerning

the capabilities, policies and activ ities of foreign powers or bodies. From time to time, if the appropriate legal authority

existed, foreign intelligence could be collected in one or other of these ways which would be of greater value to the national

interest of Australia than much security intell igence.

6.78 Traditionally

Australia, or for

the need for foreig n intelligence by

that matter by other countries, was

substantially limited to matters concerning defence and - international relations. It now extends to a wh ole range of

activities and interests, includin g economic and technological matters.

135.

6.79 Both DSD and ASIS are concerned with foreign intelligence. However, neither of these agencies has any special statutory power of collection within Australia. ASIO is the only service which has been given special statutory powers to collect

intelligence within Australia, with the warrant of the Attorney-General, in ways which, without such a warrant, would involve a breach of Australian law.

6.80 I am satisfied that Australia has a need to collect foreign intelligence which relates to its national security and its other national interests. Considerations of the national interest, national difficulties have led

independence, me to conclude

costs, and practical

that it would be highly

advantageous for Australia to be able to collect foreign intelligence within its own territory where this is possible.

6.81 Other countries have given an appropriate government body legislative authority to collect foreign intelligence within their own territories, subject to safeguards to monitor what is done and to protect the interests of citizens.

6.82 If it were desired to confer special statutory authority to collect foreign intelligence within Australia, that legal authority should in my opinion be given to AS IO. I agree with the submission made by the Australian Labor Party that, subject to some qualifications, ASIO should be the exclusive active

intelligence gatherer within Australia. No doubt, if statutory powers were given to ASIO to collect foreign intelligence within Australia, there would need to be active collaboration on the part of ASIO with other agencies, and it would be appropriate

that the approval of the Minister for Foreign Affairs or of the Minister for Defence, as well as that of the Attorney-General, should be obtained ∑before ASIO was granted warrants to exercise special statutory powers of collection.

6. 83 In my opinion it is in the national interest that ASIO should be authorised to collect foreign intelligence provided it

136.

:ihas a warrant approved both by the Attorney-General and either

~ the Minister for Foreign Affairs or the Minister for Defence,

~whoever may be appropriate. Communications by or with Australian

~citizens should not be collected and, if accidentally collected,

:should be destroyed. If, as I recommend later in this report, an

:Inspector General of Security is appointed, part of his function

∑ :should be to provide an oversight of any activities of ASIO in

∑ th i s f i e 1 d "

6.84 I recommend amendment of the ASIO Act to add a new

:provision, along the following lines, following s.l7:

s.l7A (1) In addition to (and without limiting) the functions specified in the preceding section, the Organization may, in relation to the defence of the Commonwealth or the conduct of the international affairs of the Commonwealth, and with

the approval of the Minister, following a request in writing from the Minister for Defence or the Minister for Foreign Affairs, collect within Australia intelligence relating to the capabilities, intentions or activities of a foreign

power or group of foreign powers.

(2) The Organization may, for purposes relevant to the defence of the Commonwealth or the conduct of the

international affairs of the Commonwealth and not otherwise, communicate intelligence obtained pursuant to sub-section (1) to such persons and in such manner as are appropriate for those purposes.

{3) Nothing in this section permits the

gathering or holding of information concerning:

(a) an Australian citizen

collection,

(b) the holder of a permanent entry permit under the Migration Act 1958 (c) a corporation (not being a corporation controlled by a foreign power) incorporated under a law of the

Commonwealth, a State or a Territory or any activity directed at such a person or corporation.

(4) For the purposes of this section, 'foreign power' means:

(a) a foreign government or any component thereof, whether or not recognised by Australia (b) an entity that is directed or controlled by a foreign government or governments

(c) a foreign-based political organisation.

137.

Consequential amendments would also be required to Division 2 of Part III of the Act. That Division should be amended to permit the issuing of war rants " in relation to the functions of the

Organization as specified in s.l7A'. Similar amendments would be necessary in the Telecommunications (Interception) Act 1979.

6. 85 The amendments would not represent an increase in ASIO' s powers in relation to Australian citizens. No Australian citizen or corporation would be the target of domestic foreign

intelligence operations. I suggest that provision be made also for 'minimisation " procedures, along the lines of those provided in the United States in the Foreign Intelligence Surveillance Act of 1978, in relation to intelligence regarding Australians

that may be collected incidentally or accidentally.

6.86 It would probably be necessary for ASIO to co-operate with other appropriate agencies in the exercise of this recommended function, and its activities would require to be controlled fairly closely by guidelines or particular directions. The foreign intelligence which it collects would then be communicated to the appropriate agencies. My recommendation

relates only to the collection of foreign intelligence, and not to its collation or assessment, which should be carried out by agencies already dealing with foreign intelligence.

6.87 I recommend that administrative arrangements, to be approved by Ministers, be made to govern consultation and co-operation between ASIO and other relevant agencies in regard to foreign intelligence collection and the processing and dissemination of the intelligence that is collected.

138.

CHAPTER 7

COLLATION AND RETENTION OF INTELLIGENCE

General Considerations

7.1 The way in which AS IO collates,

information that it collects bears on

effectiveness and on the interests of

information relates.

stores or discards the ASIO's efficiency and individuals to whom the

7∑ . 2 By the nature of things ASIO is likely to collect a good

deal of information that turns out not to be relevant to its purposes. The information it collects will be of no use unless it is relevant, reliable and so stored and organised as to be readily retrievable " "

7. 3 The retention of information, which is irrelevant or no longer needed will burden ASIO's information systems and tend to complicate retrieval of information that is needed. The apprehension that ASIO may hold a lot of personal information

for which it has no need also gives rise to understandable public concern.

7.4 The opening and maintenance by a security intelligence agency of files on individuals calls for special attention. Whilst it can be argued that persons are not harmed by the mere collection of information about them, they do have a legitimate

interest in limiting the information held by others about them. Th is interest has been described as 'information privacy' (Law

Reform Commission, Report No. 22, 'Privacy', 1983, Vol. 1, p. 22

et seq.) and derives from the assumption that all information about a person is in a fundamental way his own, for him to

comm unicate or retain for himself as he sees fit except where the law, reflecting countervailing social values, requires or

permits otherwise.

139.

7.5 In RCIS I identified a number of weaknesses in AS IO 's

information systems. Since then ASIO has tried to overcome those weaknesses, for example, by articulating the practices that should be followed in the collection and processing of information. It appears, however, that more remains to be done .

7 .6 The state of many of ASIO's files still leaves a lot to be

desired. Too often files appear to be repositories on which information is placed without much (or sometimes any) thought. There is little sign of effort to review files on a regular basis, or to analyse, distill and reduce their contents. A lot of files I have seen are larger than they need to be and reflec t li ttle considered review and assessment of the information that they hold.

7.7 In my view it is most important, in ASIO's own interests as well as in the public interest, that its procedures and systems for handling the information which it collects in discharge of its functions should be designed as far as possible:

(a) to weed out and discard as early as possible informatio n that is of no real relevance or value;

(b) to bring relevant information quickly to the notice of those who need to see it within ASIO;

{c) to place information on a file relating to an individual , or

otherwise aggregate information so that it will be retrievable by reference to an identified individual, only where there is clear reason to do so;

(d) to subject information which has been accumulated to culli ng

procedures with a view to removing information that has clearly ceased to be relevant or of value but otherwise to retain, in closed access conditions where appropriate,

140.

information that has been properly collected in discharge of ASIO's security functions (notwithstanding that it s future relevance or value to security may be uncertain);

(e) to ensure the security of the records, including strict

control of access to them.

I recommend that ASIO's information procedures and systems be

reviewed in the light of these objectives and to place clearer responsibility than at present on desk officers in regard to objectives (a) and (c).

ASIO's record system 7.8 Information is held on files and in indexes by ASIO's Head Office, regional offices and overseas liaison offices. The holdings of each category of office as described by ASIO are set

out at Appendix G.

7.9 ASIO is in the

information system. The a very large impact on

process of evaluating a computerised new system as it is envisaged will have

ASIO's ability to deal with information

that it holds. The manual records system would be maintained in parallel with the computerised system for at least a period while the success and reliability of the new system is fully tested.

Criteria for opening files 7.10 Public concern about the collectio n by security agencies of information concerning individuals was referred to by the Commission of Inquiry concerning certain activities of the Royal

Canadian Mounted Police as follows:

Apprehension about the technical capability state to look into every nook and cranny of lives and to retain, for unknown purpos~s ,

information about us all is reflected 1n

141.

of the modern

its citizens' mountains of the oft-heard

phrase 'they must have a file on me'. Security intelligence agencies contribute to this apprehension: they can, and sometimes do, collect information about a very large number of individuals. (Second Report, Volume 1, p.518)

7.11 Since ASIO's activities comprise in part, and depend very much upon, the collection and storage of information, decisions

must continually be made by its officers as to what information should be placed on files, and particularly on personal files.

7.12 Although it must necessarily retain a large amount of information related to individuals, I do not believe that ASIO is sufficiently rigorous in its approach to collating information about individuals or in its classification or understanding of the nature of files that are opened.

7.13 It is important to note that the individuals in relation to whom ASIO maintains files are not all 'adversely' recorded in security terms. On the one hand many files-the majority of ASIO's personal files simply record security checking and

assessment in the course of the security clearance process. (Of the 'active' personal files held at 31 December 1983, almost 60% were in security checking categories). These files are almost all 'neutral' in security significance. The existence of the file does not in itself indicate any security interest in the person other than that the person had been subject to clearance action for employment or other purposes.

7.14 On the other hand there are files on individuals who can clearly be regarded as posing some threat to security. Between the two categories is a large number of files on individuals some of whom may be of security interest to ASIO - some files are opened for the purpose of assisting in the assessment of whether the subjects are of security interest - and others in respect of whom the reason for a file being opened is less clear.

7.15 ASIO's intelligence files are for the most part collations of information about people or groups of people. Criteria for

142.

opening files on persons or organisations are contained in a document entitled 'Reporting and recording criteria' . The document sets out criteria for deciding whether a person or organisation should be made the subject of an inte lligence

report and for deciding whether persons should be indexed in the Personal Index and made the subject of a personal f ile. As

indicated below the 'Reporting and recording criteria ' is not an

entirely satisfactory document. I understand that it is

currently being revised.

7.16 I confine my comments to the criteria for opening Head

Office personal and subject files. Regional offic e files are

essentia lly working aids for regional officers and are adjunct s to the Head Office holdings which are supposed to contain the total of all information held by ASIO on any partic ular subject.

7.17 The criteria document stipulates that personal files should be opened when:

(a) full identification particulars are available; and

(b) the person is a member of an ASIO target organisat ion; or

(c) is a leading member of an overseas organisation

described in 2.4.1 who intends to visi t or is visiting Australia, and is considered likely to come to notice.

There is no identification of particular organisati ons in paragraph 2.4.1 of the document and what constitutes such an organisation is not clear. Paragraph (c) above does not provide a sufficiently clear test for working purposes and should be

clarified. Nor does the test given for opening a personal file appear apt to cover a person who - whil e not a me mber of an ASIO target organisation is c learly himself a target of ASIO security interest, e.g. an individu al considered to be a security risk in regard to espionage .

143.

7.18 The criteria document provides that Head Office personal 'testing' files are to be opened when:

7.19

(a) full identification particulars are available or are being sought; and (b) the person fits 'Recording (Indexing) of Persons' (see

(c)

(d)

". " ) ; or the person is the subject of correspondence between ASIO and another department or agency; or for Registry or desk officer requirements or storage and retrieval it is considered necessary to open a file on the person.

On the indexing of persons (see (b) above), the document says:

The indexes of security intelligence organisations should be regarded as the basic point of reference for the retrieval of all the information held by the organisation on persons. The personal indexes should therefore not be regarded as merely containing the names of persons who are 'adversely'

recorded by the Organization. They will include:

(a) per sons who are as soc ia ted, ASIO target organisations: in a way defined ... , with

(b) per sons who are not associated with ASIO' s designated targets but who are otherwise of interest to ASIO in the proper performance of its functions:

(c) persons who, by reason of their special circumstances, are of potential security interest.

Names not within these categories may be included with a specified approval.

7.20 Thus, the criteria for opening a personal testing file are essentially the same as those governing the indexing of a person. I regard this as unsatisfactoryo The tests for opening a file on an individual should be tighter and more prescriptive than those justifying the indexing of an individual's name in ASIO's central Personal Index with an indication of where documents mentioning that name can be found.

144.

7.21 Moreover, the criteria should be just that and should not include a 'catch-all' provision, such as that appearing in the present document, which allows the opening of a personal file where 'for Registry or desk officer requirements or storage and

retrieval it is considered necessary to open a file on the person'. That is not a criterion, a principled reason for opening a file, but a discretion to open a file without

indication of the basis upon which it is to be exercised.

7.22 Opening a file on a person merely for convenience leads to the placing on the file of any document in which the subject " s name appears. This practice is quite undesirable and should cease. Although files of this kind might be regarded by ASIO as harmless, the understandable public concern of individuals about ASIO having files on them outweighs any consideratio n of mere

convenience.

7. 2 3 The looseness of the criteria has probably led to the widespread provided practice within ASIO of

on each file cover under

nominating, the heading in the space

'Reason for

opening', the words 'request by desk office r ' or something similar. This practice is also undesirable and ought to be discontinued. The " reason' for opening should instead refer to the particular criterion in a revised and more stringent list of criteria which is said to justify the opening of the f ile.

7.24 The revised criteria need not apply to opening files on individuals for security vetting purposes, or for purely administrative reasons, e.g. on ASIO emp loyees or consultants . As a general rule, files should only be opened on other

individuals when there is reason to suspect that they may be of continuing security interest.

7.25 The fact that a membe r of the public volunteers

information to ASIO would not justify a personal file ('testing ' or otherwise) being opened on tha t person, though it would

justify a record in the Personal Index with an indication of the

145 .

nature of the information or where it might be found. Different considerations would apply if the individual became a regular ASIO informant. Similarly, that fact that an individual is the

subject of correspondence from a Minister, department or agency or an overseas liaison service would not normally justify the opening of a personal file on that person.

7. 26 Where it is not possible to judge whether an individual will be of continuing security interest to ASIO, a temporary personal file could be opened. It could be called a testing or inquiry file and it would be incumbent on the officer or section opening it to review it after two years at most to determine whether ASIO is justified in maintaining it as an active file. If the file met the criteria for opening personal files, it would itself become a personal file. If it did not meet this criteria, it would - depending on a judgment, under applicable procedures, on the residual security value of the file - either be destroyed or else closed on the basis that nothing further could be added to it unless it were formally reopened.

7.27 At present ASIO's 'testing' files are not subject to formal review until the expiration of ten years which is far too long for 'temporary' files. In that time a great deal of material, much of it of questionable relevance, can and does accumulate on such files simply because they are there.

7.28 Personal (non-testing) files should be opened only if there is reason to suspect that the person concerned has been, is, or will be engaged in activities prejudicial to 'security' as defined in the ASIO Act. This would include reasonable suspicion of membership or employment 1n an ASIO target

organisation. While this might be thought an excessively restrictive criterion, it would not prevent ASIO otherwise recording the security related activities of individuals both in the Personal Index and in other files.

146.

I ~

7.29 Thus if, for example, ASIO received information of an individual's contact with an identified forei gn intelligence officer, which contact could not be explained on normal social, business, academic or official g rounds, the information could be

recorded:

(a) in the Personal Index;

(b) in the personal file of the intelligence officer; and

(c) in a personal file concerni ng the indiv idual, but only if

the c ircumstances provide reason to suspect that he or she

has been, is, or will be engaged in espionage or one of the

other activities w ithin the definitio n of 'security'; or

(d) in a personal testing file concerning the person which

file could not, without cause, be left open indefinitely as a repository of informatio n on falls short of establishi ng a that person -if the evidence

'reasonable suspicion' but it

is felt desirable to explore the contact further.

7.30 ASIO's 'Report ing and record ing criteria' provide that a

subject file on an organisation may be opened:

(a) when the organisat ion has been designated an ASIO target;

(b) when the organisation has been the subject of indexing

action four times and is considered like ly to be mentioned in subsequent reports; or

(c) when the context of reporting on the organisation does not

allow classification to any existing files .

I regard

designed

the test to cover in (c) as insufficiently a single report about a

147.

precise. It seems previously unknown

organisation which is serious enough to warrant some sort of inquiry or continuing interest. A more suitable criterion might be:

when the information held is sufficient to justify a preliminary inquiry into the organisation in which case the file should be classified as a Temporary Inquiry File.

A subject inquiry file should, as with personal inquiry files,

be subject to review after no more than two years whereupon it should be upgraded to a subject file, closed or destroyed.

7.31 An issue related to the criteria for the opening of files is the procedure for the placing of documents on files. In RCIS I found that many of ASIO's files were poorly maintained in that

material appeared to be added to them without sufficient discrimination.

7.32 While there may have been a general improvement since that time, some of the more recent files I have examined still

contain material that appears to have been added without regard to its relevance or significance 1n relation to ASIO's interest in the person or organisation that is the subject of the file. Reports, including newspaper reports, are sometimes added to a file simply, it seems, because they contain a reference to the subject person or organisation.

7.33 The process of placing a document on a personal file, in particular, should not be regarded as an automatic process, nor as one that can be left to registry clerks. It requires the judgment of an intelligence officer that the document bears on ASIO's security interest in the person and is of sufficient value to be retained.

7.34 I recommend that action be taken as a matter of priority to formulate new procedures and rules, which should be expressed so as to be capable of ready application by act ion officers throughout the Organization, covering the opening and the

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maintenance of files, particularly files on individuals and organisations. The procedures and rules should be along the lines proposed above, should place clear responsibility on desk officers, and should be designed to bring about a more

disciplined and consistent approach both to the opening of files and to the placing of information on them.

Rev iew of file holdings

7.35 In RCIS (4:1, 196 and 799) I recommended that ASIO review its records and take action to destroy any which were not, or no longer, of actual or potential relevance to security. Since 1978, over 100,000 old Head Office files have been reviewed for

relevance (including before that date) ; a majority 5,000 have

of the personal files been destroyed and a created further

15,000 have been committed to microfilm.

7. 3 6 Also, all Head Off ice files opened since 19 78 have been

allocated a disposal review date (ranging from 1 year to 25 years after creation according to category) by which they must be reviewed to determine whether documents should be destroyed,

retained, consolidated with other files or reduced to some other form such as index entry or microfilm.

7.37 Revised procedures for creation and review of regional office files were instituted in 1978. These were designed to reduce regional office holdings to the bare minimum required for operational purposes, by culling duplicates of material held on Head Office files and forwarding other material to Head Office

for inclusion in its holdings or for destruction. The procedures

allow regional offices to hold only three types of files: target

files; enquiry files; and management/administration files .

7.38 Head Target Office

files can only be opened by a regional office with approval and must be reviewed when the 'target " subject of an intelligence collection program. which record act ion taken to resolve a specific

example, to identify a person thought to be of

ceases Inquiry inquiry,

to be

files, for

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security interest, are subject to retention reviews at six monthly intervals. Files are to be destroyed after the inquiry has been completed and the results communicated to the inquirer {normally Head Office). There is a final review, if required,

two years after the file was created. Head Office authorisation is required for an inquiry file to be retained for more than two years.

7.39 There are special procedures for reviewing fil es on members of any Australian parliament. Each such file {of which there are not many) is supposed to be reviewed annuall y by senior officers to ensure that the file's contents continue to meet the reporting and recording criteria d iscussed above. The file is then to go to the Director-General for his decision whether it should be retained or destroyed. Some files I saw did not appear to have undergone this process, but the review procedures are of relatively recent date. I am informed by AS IO that the review of these files has been suspended pending clarification of aspects of the Archives Act 1983 and in the expectation that my report may have a bearing on the matter.

7. 40 A program for review and culling of ASIO files should be seen as a normal management function directed to disposal of duplicate material, consolidation of holdings and disposal of particular categories of files having a clearly limited life and no enduring interest.

7. 41 The question arises whether, beyond that, such a program should be directed to review of the security relevance, actual or potential, of the contents of particular files. An argument can be made that ASIO files, by reason of their personal

intrusiveness, should be retained only so long as they are of security interest.

7.42 The Australian Labor Party's submission recommend s that the 'Security Commissioner' proposed in the subm ission be empowered to order the destruction of any fil e , or part thereof,

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~which in his view either failed to fulfil ASIO's recording

11criteria and should never have been opened in the first place 10r, alternatively, now satisfied the destruction criteria and

.should be immediately disposed of. It was submitted that the jCommi ssioner's decision should be final subject to ASIO having a

right of appeal to the SAT.

7.43 ASIO has put to the Commission that its records should, in general, be retained and that it should make judgments about

destruction where necessary 'based on corporate and individual

experience'. ASIO points out that it is the use to which information is put which carries within it the potentia l for damage to the interests of an individual, and not the mere

holding of information. ASIO has argued too that:

The preservation of files is also justified as they constitute the record of action taken by ASIO with respect to an individual or organisation, and their retention thus protects from an evidentiary viewpoint the interests both of

the Organization and the individual in case of future review of ASIO's actions, especially as accountability mechanisms of various kinds have an increas ing impact on the

Organization.

7.44 The difficulty with any review of the present security relevance of particular file holdings is that material which appears to be of no current relevance may be relevant to

security in the future. Information properly collected in the past may seem to have no bearing on security today but it may, wh en put together with other information to be collected in the

future, assume a vital significance.

7.45 In RCIS (4:1,196) I noted that:

A requirement that ASIO destroy all rec~rds e3:bout _people whom it has not established to be secur1ty r1sks 1s not justified. Such a requirement is based on a simplistic idea about the nature and the difficulty, of ASIO's task.

Information cannot' be assessed until after it is collected∑ Apparently innocent information a~out people might, after tne addition of other inforrna t1on, assume a different appearance. The reverse can also happen.

151.

7.46 There will be some categories of files which, in

accordance with ordinary record-keeping practices and without risk to future security needs, should be reviewed after a specified time with a view to destruction. However I have concluded that a more general policy directed to review of particular files and the destruction of those which appear to be no longer of security interest would be mistaken.

7. 4 7 My conclusion is based, first, on my appreciation of the extreme d iff icul ty of the task and the nicety of the judgments involved. Once the policy moves away from the application of criteria for culling or destruction of a kind which can readily be delegated, e.g. a direction for the destruction of duplicate material or after so many years of files falling within a nominated category, only very experienced intelligence officers will be able to exercise the judgment required, and even then without full assurance. The task is a difficult one and would

involve what I regard as an unwarranted commitment of effort and expertise to what is essentially a non-productive activity.

7.48 It is far better, in my view, to direct ASIO's energies to the opening of files, and the placing of material on them, in accordance with appropriate security-related criteria, and to greater oversight of that practice. I regard as more objectionable the creation of a file on an individual without adequate justification, than the retention of a file, which was properly opened, beyond a time when it may still retain a security significance. If the file is securely held, and is

'closed' at an appropriate point to preclude the addition of further material without cause, no new or additional harm is caused to the subject.

7.49 ASIO

I place weight, too, on

(7.43) of preserving the the consideration referred to by record of action taken by ASIO

with respect to an individual . or organisation. Failure to do so can result in unnecessary doubts and suspicions being raised at a later date.

152.

7.50 More importantly, I am aware of files, which were

apparently destroyed in the belief that they were of no further security value, and were later realized to be of significance to investigations of a kind that probably could not have been foreseen. The absence of earlier records can seriously impair ASIO' s capacity in such

is a useful warning

destruction of files.

cases. The experience to which I refer against over-zealous or uninformed

7. 51 I regard it as essential that the decision whether to retain or destroy its records should remain one for ASIO's management subject to any guidelines or direction that the Attorney-General may issue in exercise of his ministerial

responsibility. I do not regard it as appropriate for the proposed Inspector-General to be empowered to override the Director-General on such a question. A power of that kind would conflict with his inspectorial and advisory role and cut across

the line of executive responsibility from the Director-General to the Minister. Nor do I see it as appropriate for the Security Appeals Tribunal to have such a power.

7.52 I certainly do see an important

Inspector-General in reviewing ASIO's performance maintaining files in accordance with the revised rules that I have recommended (7.34). It would Inspector-General, if he believed a particular

role for the

in opening and procedures and be open to the

file had been

opened without adequate justification, to recommend to the

Director-General, or destroyed. But the then the Attorney-General, that it be decision would rest with those direct ly

responsible for ASIO's management.

7.53 I see scope also for greater emphasis on removing from the holdings of " active' files those files which appear to be of limited, if any, continuing security interest. The files could be removed to a separate storage for inactive files, the access to which would be restricted, and would not have material added to them in the ordinary course of events.

153.

7.54 I recommend that ASIO revise its policies for culling and destruction of files with a view to:

(a) culling of unwanted material from files in accordance with good file management principles;

(b) destruction after a specified period of any particular

categories of files that can be identified as having a limited life and no enduring security interest;

(c) other files being reviewed after a nominated period and removed to a restricted access 'inactive' file holding if I they no longer appear to be of present, or likely future, ~ -security interest.

Impact of Archives Act on ASIO 7.55 ASIO's retention or destruction of its records, and its control of the

over access to them, are now affected by the provisions Archives Act 1983. That Act contains a general

prohibition on destroying 'Commonwealth records' (which includes ASIO records) except:

(a) where required by law;

(b) with the permission of the Australian Archives or in

accordance with a practice or procedure Archives; or approved by

(c) in accordance with 'a normal administrative practice' other than one of which Archives has notified the agency concerned that it disapproves (s.24).

7.56 The introduction of this legislation has led to a halt in ASIO's culling program pending its approval by the Australian Archives in accordance with the Act. There is a need for ASIO

154.

J

and the Archives to agree on suitable arrangements, in

accordance with s. 24 (2) (b) of the Archives Act, to allow the Organization's regular records culling program to continue.

7.57 ASIO's operations are also affected by the requirement that the Archives make available for public access Commonwealth records that are 30 years or more old (s.31). There is provision (s.33 (1)) for the exemption of records containing information the disclosure of which could reasonably be expected to cause damage to the security of the Commonwealth, or information

communicated in confidence by or on behalf of a foreign

government.

7.58 The grounds for claiming such an exemption can be reviewed by the Administrative Appeals Tribunal. However, there is provision enabling the relevant Minister (the Attorney-General in the case of ASIC) to issue a conclusive certificate in

respect of a claim for exemption on those grounds ( s. 34 ( 1)). Where such a certificate has been issued, the Tribunal can

review the question whether there exists reasonable grounds for the claim for exemption and, if it finds there are no reasonable grounds, the Minister has the option of revoking the certificate or, if he does not, of publishing reasons for his decision. The Tribunal cannot, however, override the Minister's decision to

issue a certificate. Other relevant grounds of exemption in s. 33 (including where disclosure of information would constitu te a

breach of confidence) are subject to full review by the Tribunal.

7.59 ASIO has submitted to the Commission that it s capacity to function effectively will be diminished as a result of the public right of access to its records:

The 30 year. time limit does not provide for a long enough passage of time for the secure release of many ASIO

documents. After only 30 years, release could still reveal sources, modus operandi and. other information damaging to the credibility and reputat~on of the organization. Such disclosure would have serious effects upon ASIO's ability to

fulfil its statutory responsibilities.

155.

ASIO is also concerned that under the Act Archives staff could

have access to its records. The Organization's 'preferred option " is that the Director-General of Security be empowered under the Archives Act 'to authorise the release of records on a selective basis at a time when security and privacy

considerations are no longer deemed relevant'.

7. 60 It appears that ASIO neglected to identify and press its concerns effectively during the long period in which proposals for the archives legislation were under considerat ion. Nevertheless, if there is a problem it needs to be addressed.

7.61 The effective functioning of a security service rests on its capacity to conceal its methods from public gaze and to keep confidential its sources of information. In many cases the passage of 30 years will remove the risk of damage from

disclosure. But this will not always be so. Some information, even of that age, will be of value to hostile intelligenc e services. It may not be possible for ASIO to identify the material of which that will be true.

7. 62 There is a strong public interest the privacy of individuals about whom ASIO even after the passage of 30 years.

in the protection of information is held by

7.63 ASIO's ability to protect the identity of an agent is critical to its ability to collect intelligence. I can see no public interest in allowing, as part of a general archival program, the identity of an individual who has acted as an agent of the nation's security service to be made public during the agent's lifetime or, indeed, after the agent's death, because of possible effects on family.

7.64 The exemption grounds, at least so far as they permit the Attorney-General to issue conclusive certificates, provide a means of protecting these important interests. Care will need to be taken in the handling of ASIO " s records to ensure that they

156.

are in practice afforded proper protection. I am disposed, however, to favour a provision that would exemp t ASIO " s

operational records from the general provisio ns for the handing

over of records to the Australia n Arch ives and from the

presumption in favour of public access after 30 years.

7.65 I recommend:

(a) that ASIO and the Australian Arch ives wo rk out as soon as

possible arrangements, of the kind contemplated by s. 24 (2) (b) of the Archives Act, under which ASIO may continue with a program for culling of its records;

(b) that consideration be given by the Government to the preparation and introduct ion of legislative am endments to remove ASIO' s operational records from the requirement to hand records over to the Archives after 30 years and from the application of the 30 year rule in regard to public access (I see no reason why its administrative records should be so protected) , while allo wing the Director-General a discretion to hand over to the A rch ives for public access

records 30 or more years old where he considers this can be done consistently with the interests of security and personal privacy.

(c) Pending any such amendment of the legislation, ASIO

(supported where necessary by the Attor ney-General) and the Archives exercise particular care in considering whether to place any records of ASIO in publi c access .

Impact of Freedom of Information Ac t

7.66 ASIO is exempt from the operation of the Freedom of

Information Act 1982 and exemption is afforded to other agencies in relation to documents that have originated with or been received from AS IO (s. (7) (l) and (2A)). G iven the nature of ASIO

157.

records, I regard these exempt ions as appropriate. Nothing in any of the submissions I received has persuaded me to recommend that these exemptions be revised in any way.

7.67 Nor am I persuaded, as was submitted to me, that there

should be a statuto ry right for any Australian to discover whether he or she is the subject of an ASIO file, and further that such person should be supplied on request with a statement concerning the general nature of any adverse or qualified assessment on record and of the information in support of it.

7.68 Such a right would be akin to a right in a citizen to

discover from the police whether he is a suspect in a criminal investigation. Such a right to discovery could in both cases seriously prejudice the effectiveness of lawful investigations. Just as it is accepted in respect of police investigations that discovery is neither appropriate nor necessary until formal prosecution, I see no justification for it in the case of ASIO

investigation unless and until that investigation results in the communication to government of an adverse security assessment concerning an individual. When that happens, the provisions of Part IV of the ASIO Act apply. (I recommend a relevant amendment to those provisions in Chapter 17).

Internal processing and dissemination of information 7. 69 The manner and speed with which information collected by ASIO is processed and distributed within the Organization

affects ASIO's capacity to provide accurate and timely 'intelligence' to its customers. The introduction of computer

based information processing systems will, of course, have a marked affect on ASIO's performance.

7.70 Information collected by ASIO for analysis at Head Office generally comprises:

(a) human source reports (agents' conversation, transcribed from speech to paper);

158.

(b) telephone intercept reports (targets' conversation, transcribed from speech to paper);

(c) technical intercept reports (targets' conversation and behaviour, transcribed from speech to paper) ;

(d) surveillance reports (targets' behaviour, contacts and

conduct, transcribed from observation to paper);

(e) the product of ASIO-initiated interviews with members of the public;

(f) information provided by government agencies and liaison services;

(g) publicly available material;

(h) unsolicited information from members of the public.

7.71 The

which has

aspect of processing and caused most concern within distributing information ASIO, and which received some attention in the Ivanov/Combe inquiry, involves what is

derived from telephone and technical interceptions. That product represents an important element in ASIO's intel ligence. The systems for processing it and getting it from regional offices to Head Office in a timely fashion have concerned ASIO for many years.

7.72 Major improvements have been made; the production time, that is, how long it takes for a report to reach the appropriate desk officer from the point of intercept, has been reduced. A distribution information system, introdu ced in 1980 and

involving the extensive use of word processing equipment, has improved the flow of information but its efficiency is limited by the lack of a secure means of on-line data communication

between regional offices and Head Office. Delays still occur in fully processed intercept reports being placed on files .

159.

7. 7 3 The procedure for one regional off ice to Office has always been

handling intercept product varies from another. The New South Wales Regional cons ide red the 'odd one out' in one

target area by not sending to Head Office, in the first

instance, typed 'logs' or summaries of all calls noted. Rather, hand-written logs go first to case officers in the regional office who mark items for processing. Those items then go to Head Office. It is only later that the logs are sent to Head Office desk officers for their selection of items for processing; requests are then sent back to the regional office. The processed reports, when received, are then distributed to

relevant files. This procedure has been criticised by desk officers. It is said that the desk officer, rather than the case officer, should select i terns to be processed because he or she is better able to judge the overall relevance of particular intercept items. Case officers, by contrast, are said to be more concerned with regional operational leads.

7.74 An ASIO submission to the Commission on the employment and role of audio intercept monitors noted other differences in procedure:

Some regional offices require the monitor to add identifying details such as file references to the report, while others require the case officer to do so. There are other

differences in procedures and a monitor cannot necessarily transfer to another regional office without having to learn a new set of rules. There also appear to be differences of opinion in Headquarters and, in the past at least, between Headquarters and some regional offices as to what is actually required in the intercept report.

Procedure does not stop at what monitors, case officers and desk officers are required to do, but extends to the method by which intercept reports are transmitted to Headquarters and the systems under which reports are classified in Headquarters. Given the distances between regional offices

and Headquarters, some time-lag between the initiation of an intercept report by a monitor and the receipt of the action

160.

copy by the relevant Headquarters desk officer is to be expected. Extended delays, however, can have serious repercussions in that assessments may be based upon incomplete information.

Uniform procedures were formulated some years ago, but should be examined again in the light of experience.

I agree that such an examination should take place. I note that

an investigation is already in progress aimed at determining the

impact of proposed automatic data processing on the processing of intercept product.

7.75 A consultant has recently completed an 'information systems quality assurance review' designed to determine the quality of ASIO's information systems and possible solutions for any defects. The report lists the components of 'quality' as

accuracy of content completeness of content accuracy of syntax/grammar timeliness of transmission/delivery

relevance to agreed requirements.

The report says that there is no formal mechanism within ASIO

for ensuring that its information sets conform to the above criteria. It suggests the appointment of a 'quality assurance officer' to monitor adherence to agreed quality standards.

7.76 The consultant's interim report also implicitly questions the present division of responsibilities between case officers (in regional off ices) and desk officers (in Head Off ice) ∑ points out that ASIO's information collection processes:

It

. " " of necessity provide large quantities. of 'raw' da~a, much of it irrelevant. Ideall y, the filter 1 ng process whIch transforms data to information should be ~pplied as.close to the point of capture as possible. This 1s where Issues of quality assurance are first encountered~ Pr?perly formulated

and applied, the quality related criteria may serve to

161.

reduce the volume of paper transmitted to Headquarters, and subsequently placed to file. . . . Ideally, the various roles involved in the processing of raw data into intelligence, including Monitors/Linguists, Case Officers and Desk Officers together with the various types

of Surveillance Officers, would benefit from forming a close-knit team, co-located in the vicinity of their target, in order to concentrate their efforts, and take benefit from the immediacy of communication, and decision making. The single factor which prevents this, is the availability of the organisational records data-base, which is the cornerstone of the Desk Officers decision making structure. The proposed automated storage and retrieval system to provide Desk Officers access to the data-base via

telecommunications to a central computer may negate this restraining factor. As this facility becomes available, it is recommended that consideration be given to evaluating alternative reporting structures, based on such a task oriented model.

7.77 This recommendation merits close consideration, even if it means reconsidering the earlier re-organisation of intelligence and operations branches. I think the processing within ASIO of information once collected can be refined to reduce the volume of material, much of it of questionable relevance, that finds

its way on to Head Office files, and to reduce the delay between notice to case officers and that to desk officers of the nature of information collected by intercept.

7.78 Another of the consultant's recommendations which I strongly endorse recommendations) report:

(and which is consistent with RCIS

appears in the following extract from his

There are no control mechanisms in place to assure the veracity of file contents, therefore unauthorised additions, deletions or modifications may go undetected. It is recommended that file contents be folio-numbered, and that all additions, deletions, and modifications, if carried out at all, are carried out by (Information Management Branch) staff. This provision alone will not assure the veracity of

file contents unless a means of checking the continuity of folio sequencing is implemented concurrently. Previous attempts to address this problem have foundered due to the unavailability of staff to conduct the tasks. If staff cannot be made available, alternative means should be

162.

considered, perhaps based on spot sampling of using sensitive scales, or the placement of seals to groups of documents. file weight

non-rem ovable

7.79 I am not at all persuaded by the reasons g iven by ASIO for what the consultant referred to when he said that 'previous

attempts to address this problem have foundered'. ! see the problem as one that can be overcome by whole-hearted effort . The matter has implications, referred to elsewhere in the report, for quality control of ASIO's assessments as well as for ASIO's

internal security auditing.

7.80 I recommend that action be taken as a matter of priority :

(a) to improve the processing and flow of intercept material

from regional offices to head office, including the introduction of uniform procedures designed to give desk officers as well as case officers the earl iest possible notice of the nature of intelligence collected and to ensure that only material of security value is allocated to files;

and

(b) to introduce mechanisms, including for folio-numbering file contents, to assure the veracity of file contents of

as

well as to facilitate reference to those contents.

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CHAPTER 8

ASSESSMENT AND COMMUNICATION OF INTELLIGENCE

Assessment of intelligence 8.1 The assessment of the intelligence that it collects is central to ASIO' s role. In RCIS (4: 1, 202 et seq.) I said of intelligence assessment:

Assessment should be an integral part of the intelligence cycle. Whatever the. source of information ASIO collects, it must be critically evaluated and assessed soon after collection. Simply to store it, or to sort and store it, does not produce intelligence. It only produces voluminous

not very useful records

The process of intelligence production must be one of distilling what is most relevant from a large volume of material. In this way, trends are identified and overall perceptions of the situation develop

...

The intelligence analyst faces a situation where his information, coming from different sources and with widely varying credibility, must be constantly and sceptically appra~sed. In security work nothing can be assessed to be

what 1t seems ...

Thus, intelligence assessment is no simple or routine activity but a highly skilled and subtle task.

I concluded (4 :1, 200) that ASIO had not performed well enough

in intelligence assessment. I recommended some means of improvement, including assessment officers and augmenting

developing the pool

processes of

sources, independently of the operations area.

of qualified evaluation of

8. 2 Improvements have been made in these two areas. Virtually all assessment at the desk officer level is now performed by graduates, most of whom have been recruited since RCIS. Responsibility for intelligence assessment rests with the Head Office intelligence branches, with primary responsibility for

intelligence collection and the management of sources residing with regional offices. This arrangement facilitates the critical

164.

evaluation of intelligence reports, independently of the areas

responsible for their collection. At the same time, Head Office

desk officers are kept aware of all technical and human sources

in their target area.

8.3 The assessments produced by ASIO vary in quality and

format. I think there has been an overall improvement in quality

since RCIS. However, an annoying feature to an outsider 1s a

tendency to state assertions or beliefs as facts and to mingle

facts with inferences drawn from them.

8.4 I think that the quality of ASIO assessments wo uld be

improved by the adoption of two measures. First, all assessments

of targets or

should follow

organisations a common

and persons format along of security interest the lines of ( 1)

introduction; (2) facts or supposed facts, with an indica tion of

sources and reliability where appropriate~ (3) discussion of

possible inferences to be drawn; ( 4) concluded assessm ent. Secondly, ASIO should

report- writing skills

arrange for desk

a program of traini ng in

officers including possible

attendance at external courses. Such courses, I understa nd , are

run within the Public Service and the Defence Force.

8.5 There is considerable criticism within the Organization to change that personnel policies, Positions frequently to

against

analysis. specialisation While I am

and

not

which encourage recruits broaden weaken able

their experienc e militate the qua 1 i ty of in te 11 igence to judge the extent of the

Problem, I make the point that the Organization should benefit

by having some desk officers special ising in p articular subject

areas, particularly in 'hard' areas where familiarity with the

subject can only be built up over a number of years. Desk

Officers who have an aptitude for wor k in particular areas

should be allowed some opportunit y to specialise without being

~n al i sed for doing so. I realise that the problem may be

ameli or a ted when the bulk of graduates who have been recruited

over the past seven years have completed the development program

165.

and are able to settle into particular positions.

8.6 ASIO assessments of security risks take a variety of forms. Desk officers are expected to provide to regional offices basic papers and briefings on designated targets. In addition to outlining each target's history, aims and activities, the briefings place the target in a national perspective. These or similar assessments of targets in Australia are also provided to government and, in appropriate cases, to overseas security and

intelligence agencies.

8.7 In addition, the Organization provides 'threat assessments' in a variety of circumstances, including assessment of threats of politically motivated violence in relation to persons or special events. Threat assessments in relation to politicall y motivated violence, subversion, espionage and sabotage are also provided to government agencies for long-term protective

security planning.

8.8 ASIO normally provides to the Government an overall

assessment of threats to domestic security every two years. The last one was dated August 1981.

8.9 Another form of assessment provided by ASIO is the securit y assessment of persons requiring clearance for access to national security classified matter or areas or in relation to migratio n matters. Those assessments are generally governed by Part IV of, the ASIO Act and are subject to review by the Security Appeals Tribunal. The assessment provided to the Government concernin g

Mr Combe's relationship with Mr Ivanov was an example of a

'one-off' situation not covered by the review provisions of the Act.

8.10 In my report

pointed to the need dealing with for ASIO to

166.

the Ivanov/Combe matter review its practices an

procedures in order to reduce the possibility of error and to reveal, when reporting in the exercise of its functions, the existence of any such possibility (Report on Term of Reference

(c) , p. 218 , par a 2) "

8.11 This arose from my finding that certain errors and

misconceptions were contained in information ASIO provided to the Government in that case. I emphasised that the greatest care needed to be exercised when ASIO took a matter to a responsible ' Minister or to a Cabinet Committee, particularly when its

presentation could adversely affect a private citizen.

Hidaka case

8.12 The need for this care is illustrated by another case which concerned the refusal, in January 1981, of a visa to visit

Au stralia to Professor Rokuro Hidaka of Japan. I exam ined this

matter following receipt of representations on his behalf.

8.13 Professor Hidaka was invited by two Australian

universities, under the auspices of the Japan Foundation, to lecture on aspects of Japanese society during the 19 81 academic year. He and his wife applied in Japan for a temporary entry

visa valid from 17 January 1981. The visa applications were rejected, and Professor Hidaka was subsequently told that the rejection was based on the direct association o f himself and his wife with the terrorist group, the Japanese Red Army (JRA) ∑ Professor Hidaka denied this involvement and continued to do so

throughout a long campaign to have the 1 ban 1 on en try rever sed∑ It was in fact reversed for him, but not his wife, in July 1983.

8.14 It is not possible for me to resolve a question whether a

foreigner, refused a visa for entry into Australia for his alleged support for a foreign terrorist organisation which he denies, and in respect of which he has not been the subject of any criminal charges, did or did not give that support. I cannot

and do not express any concluded view about Professor Hidaka; I

can only consider ASI0 1 s actions in this matter.

167.

8.15 The immigration authorities' decision to refuse the Hidakas' entry visas was based on an adverse recommmendation by ASIO communicated on 16 January 1981. Since the Hidakas were not

in the categories of persons covered by Part IV of the ASIO Act, the recommendation was not reviewable by the Security Appeals Tribunal, and the Hidakas were not told the precise reasons for it.

8.16 ASIO held information about both of the Hidakas. The recommendation was expressed as being based primarily on the Hidakas' active support for members of the JRA. Advice about the matters relied upon by ASIO was provided to the immigration authorities including, as regards Professor Hidaka, statements

(among others) that he was one of the JRA' s theoreticians, and he was believed to have become a leader of an extremist faction of the JRA.

8.17 As regards the first of these statements, ASIO put as a Even fact an allegation that was expressed to be a presumption. if the source of the information was being cautious framing the allegation, as ASIO was later told, that

in so

caution

should have been reflected in ASIO's advice.

8.18 As regards the second of the statements, ASIO had

information that the faction of which Professor Hidaka was believed to have become a leader was extremist and anarchistic. It also had information that a group or groups with a similar name had been involved in

suspected members of the JRA, terrorist incidents, contained and had some connect ion with the

JRA. However, it did not have information that∑ it was a faction of the JRA. The form in which the information came to ASIO and the nature of this information, coupled with the short time (2 days) within which ASIO had to make its assessment, probably led

to the making of the mistake, but a careful reading or checking should have avoided it.

168.

8.19 The inaccuracies in these two statements do not invalidate ASIO's assessment but they should not have been made. They emphasise the need for a careful examination and assessment of information, and that ASIO has to take steps to ensure the accuracy of its reporting of facts. Also, when ASIO discovered

(in July 1981) its mistake about the faction, it did not notify the Department of Immigration and Ethnic Affairs or its Minister, although the Minister was told by ASIO about a mistake 1n a report from another source not referred to in ASIO's

original recommendation, but later communicated to the Department. I should add that when briefing the Secretary of the Department of Foreign Affairs in May 1982 for the purposes of a visit by the then Prime Minister to Japan, ASIO reported

accurately on the information upon which it had based its assessment.

8.20 ASIO decided not to inform the Minister about its mistake

because the unchanged. In main the

thrust light of of its original the great public

advice remained interest in the

matter and its importance to Professor Hidaka, ASIO should have ensured that the matter was drawn to the attention of the Minister. It is the Minister who has to make the decision, and it is he who has to decide whether some change of the factual basis of ASIO's advice will affect his decision. ASIO must not

take this responsibility itself.

8.21 Despite the matters referred to in 8.16 to 8.18, I do not conclude that ASIO should not have made the recommendation which it gave to the immigration authorities on 16 January 1981. None f ∑ 8 16 t 8 18 affected ASIO " s o the matters referred to 1n . o ∑

advice about Mrs Hidaka.

8. 2 2 Between 16 January 19 81 and 4 March 19 8 2 AS IO received

further information concerning Professor Hidaka, some favourable to his case and some unfavourable. The assessment of all the information held by ASIO involved quest ions of judgment, including judgments as to credibility. On 4 March 1982, ASIO

169.

advised the immigration authorities that, while it stood by its original assessment, any threat from Professor Hidaka had been neutralised by publicity and that it was hardly likely that he would behave in other than a correct way. On 28 May 1982, this advice was repeated, ASIO saying it would no longer wish to object to Professor Hidaka's entry to Australia on securit y grounds. On 25 June 1982, following a further application for a visa by Professor Hidaka, ASIO confirmed (with an exception in relation to a matter not referred to in the original assessment) the information about Professor Hidaka, and said it stood by its original recommendation, and repeated its advice of 26 May 1982 that, in the existing circumstances, it did not recommend against Professor Hidaka's entry on security grounds.

8.23 In further discussions with the Department of Immigration and Ethnic Affairs ASIO expressed the view that, despite its revised security assessment, it would prefer that Professor Hidaka did not come. Later it advised that its revised security rl assessment was outweighed by wider considerations which from the I Organization's point of view would make a visit by Professor Hidaka unwelcome. These considerations related to surveillance problems, the repercussions that might occur if Professor Hidaka abused the right of entry given to him, and the effect of an apparent weakening of Australia's attitude to people w ith terrorist associations.

8.24 r' ASIO did not, in any of the discussions or communications I with the immigration authorities in 1982, correct the inaccuracies contained in its original assessment of 16 January 1981 , although it had every opportunity of doing so. I am unable

to say that AS I 0 was not j us t i f i e d , in the l i g h t of a 11 the

information it held in 1982, in standing by its origina l recommendation, but no matter what the 'main thrust' or principal basis of its case was, it was wrong of it to allow the immigration authorities to make a decision refusing the visa without telling them of any inaccuracy it knew about in its earlier advice.

170.

..

8. 25 For the future, I recommend in Chapter 17 an amendment to

∑the relevant legislation to allow the Government a discretion to

refer to the Security Appeals Tribunal, in an appropriate case,

.an assessment by ASIO that has an adverse effect on someone who

is not an Australian citizen or a permanent resident.

are of vital importance to assessment. These matters intelligence organisation. I am not suggesting that ASIO is not capable of making sound assessments; it is. But the system within ASIO does not appear to be such as to assure sufficiently

that assessments will consistently meet required standards.

8.27 By its nature, the information available to an

intelligence organisation will often be less than firm and

precise. Checking is not always easy, and the time available may not allow much scope for it. However, given time, ASIO should be

at pains

which it

must also

to verify, as far as is possible, any information on may base an adverse assessment of an individual. It

be meticulous to correct any information which it has given and which it discovers to be inaccurate.

8.28 One factor that cannot be overlooked is that, as a

consequence of the large influx of graduates in recent years,

the initial responsibility for assessing intelligence quite

often falls on relatively young, inexperienced officers. This may be unavoidable but it is a factor which places a premium on

Proper supervision and procedures for verifying the quality of

assessments particularly in significant matters.

8.29 One area of ASIO where there has been some learning from experience is in the branch that produces security assessments rposes Adverse on individuals requiring clearance for access pu ∑

171.

or qualified assessments have been subject to review by the Security Appeals Tribunal since 1980. The introduction of the review system led to the establishment of tighter and more disciplined procedures to put ASIO's case in respect of challenged assessments in a form required to satisfy the Tribunal.

8.30 ASIO submitted a paper to me entitled 'Suggested

procedures for compiling and processing critical submissions containing adverse advice on persons ineligible to appeal to the Security Appeals Tribunal' " The paper proposed that the procedures applied within the Organization for preparing submissions to the Security Appeals Tribunal should apply to all formal assessment of adverse information held on individuals which may result in action being taken to their disadvanta ge. In preparing submissions to the Tribunal, factual information is drawn together by an assessing officer who is briefed to exercise care in separating the inferences and conclusions he draws from the facts. The officer is obliged to nominate the source of each fact, evaluate the reliability of the source and the credibility of the information, and to specify whether it is corroborated.

B. 31 It is clear that organising materials in such a man ner

facilitates checking of original assessments by supervising officers. I regard such checking as essential before any adverse assessment on an individual leaves the Organization. Wh ile checking is made more difficult by ASIO's practice of not numbering pages in files, individual documents that are ma terial

to an assessment can and should be flagged for a supervisor's attentio n. If a system of page numbering we re introduced, as I believe it should (see 7.78-7.80), the identific ation of relevant documents could be carried out quite simply.

8. 32 ASIO should extend internal procedures similar to those that apply to the preparation of Security Appeals T ribunal submissions to the preparation of all assessments intended to be

172.

communicated outside the Organization and which concern individuals and may result in action being taken to their disadvantage.

8.33 An assessment should itemise the facts material to it and indicate the source of each fact with, if appropriate , a comment on the source's reliability. The intel ligence reports or other

docum ents on which each factual ite m is based should be flagged or otherwise made readily retrievable. There should then be a separate discussion of the material facts including an assessment of their significance and possible inferences that might be drawn from them. Discussion of possible courses of action would follow, with the assessment ending with a clear statement examining document assessment

of the action the assessment recommended. All supervising should indicating whether they

and should include any may of course differ

sign and date a

agree or relevant from that

disagree comments. prepared

officers covering with A

by

the

final the assessment originating officer and Organization without the

that changes along these

an assessment should not leave the approval of a senior officer. I believe lines are o f the utmost importance.

8.34 I recommend that ASIO:

(a) adopt a more structured approach to the preparation of

assessments, along lines refer red to above (8.24 and 8.27), with a requirement for the identification, in a readil y retrievable manner, of material upon which reliance is placed:

(b) lay down clearly the responsibility of supervisors

satisfy themselves of the accuracy and qualit y of to

an

assessment and the level of clearance required before assessment of particular kinds leave the Organization;

17 3 .

(c) arrange appropriate training, including possible attendance at external courses, to inculcate a more uniformly disciplined approach by desk officers to the preparation of assessments and the writing of reports. (In my Report on ONA and JIO I recommend that ONA take an initiative to develop a

training course for the introduction of intelligence agency officers to the discipline of intelligence assessment. Such a course would meet at least part of ASIO's training needs.)

I am informed by ASIO that procedures along lines of some at

least of those proposed in (a) and (b) have been introduced. It is important to ensure that the procedures are adequate and that full effect is given to them.

Authority to communicate intelligence 8.35 Two of the three functions conferred on ASIO by s.l7 of the ASIO Act are:

to communicate, for purposes relevant to security and not otherwise, any intelligence relevant per sons, and in such manner, as are purposes, and

to security appropriate to such

to those

to advise Ministers and authorities of the Commonwealth in respect of matters relating to security, in so far as those matters are relevant to their functions and responsibilities.

The giving of advice in fulfilment of the second of these functions is directed primarily to matters other than the communication of intelligence, but it may involve the communication of intelligence.

8. 36 Also, s.l9 of the ASIO Act provides that so far as is

necessary for, or conducive to, the performance of its

functions, the Organization may, subject to any arrangements made or directions given by the Minister, co-operate with:

174.

{a) authorities of the Commonwealth;

{b) Departments, Police Forces and authorities o f the states;

(c) authorities of other countries approved by the M inister as being capable of assist ing the Organization in the performance of its functions.

The co-operation authorised by this section must intelligence as well as times the communication of of intelligence, relevant to security, provided

involve at the receipt

that that

communication or receipt is necessary for, or conducive to, the performance of ASIO's functions.

8.37 That the communication of intel ligence relati ng to security to authorities of the Commonwealth and to departments, police forces and authorities of the States is justifi ed is obvious. Co-operation with approved authorities of other countries involves the exchange of intelligence relevant to security. The receipt of security intelligence from the other country could clearly and does in fact assist ASIO in the performance of its functions, and the cornmunica t ion of security intelligence to another country ma y directly assist ASIO in the performance of its functions, or it may be necessar y as part of a reciprocal arrangement which involves intelligence from that other country . the obtaining of 8.38 The purpose of the passing of intel ligence by ASIO to the authorities of another country would genera lly be relevant to the security of that country, and not, sav e indirectly , relevant to the security of Australia. It can therefore be argued that such a communication is not authorised, and indeed is prohibited by s " 1 7 ( 1 ) ( b) " I am not sat i sf i e d that t h i s a r g u men t is cor r e c t , but if it is, s.l9 (c) is almost useless, and the matter should be put beyond doubt. I recomme nd that s .19 should be amended by lnserting a provision including w ithin the co-operation with the ~u t hor it ies of other countries au thor i sed by s ∑ 19 (c) the communication of inte lligence by AS IO to those authorities for the purposes of the security of those countri es. 175.

8.39 The authority .of particular officers of the Organization to communicate intelligence is regula ted by s. 18. Sect ion 18 ( l) provides that the communication of intelligence on behalf of the Organization shall be made only by the Director-General or by an officer of the Organization acting within the limits of authority conferred upon him by the Director-General.

8. 40 Section 18 ( 2) provides in part that if a person makes a communication of any information that has come to his knowledge or into his possession by reason of his being, or having been, an officer or employee of the Organization, being information that was acquired or prepared by or on behalf of the

Organization in connection with its functions or relates to the performance by the Organization of its functions, other than a communication made by an officer within the limits of authority conferred on him by the Director-General, or with the approval of the Director-General or of an officer having the authority of

the Director-General to give that approval, he is guilty of an offence.

8.41 Section 18(3) deals with the communication of non-security intelligence which I discuss separately.

8.42 Apart from cases where a specific approval has been given, the power of officers of the Organization to communicate intelligence depends upon the scope of the authority conferred upon them by the Director-General. Where the communication has been specifically approved by an officer other than the Director-General, the power to make the communication depends

upon the authority of the officer to give the approval. It appears that no set of formal instruments of delegation or authorisation has been issued general guidelines have been sources of express or implied variety of documents.

by the Director-General but some established, and a number of authority are to be found in a

8.43 In notes made by the former Director-General, Mr Justice

176.

Woodward, on the ASIO Act

was pointed out that with

levels between ASIO and

following the ever various

its enactment in 1979, increasing contacts at Government departments

it

all

authorities, the question of just wha t authorit y and the

Director-General

that the only way the passage of

has conferred on officers is difficult, and in which limits could sensibly be placed upon information was by making it clear that

information might only be passed to officers of Gove rnment departments and authorities and then only on a 'need-to-k now' basis. Any communication which did not fall within these

boundaries would have to be approved by the Director-G eneral, either on a continuing basis or specifically in the partic ular case.

8.44 Express or implied authorities are to be found in :

(a) A document entitled 'Reorganisation of B/D Branches' which

authorised the Assistant Directors-General o f two Head Office intelligence branches to authorise all poli cy documents raised in their Branch, in particu lar those being transmitted to foreign intelligence services, and to

authorise responses to all ministerial inquiries. The latter authority has been superseded w ith the c reation of the Secretariat Branch. The docume nt also authorises

co-ordinators to sign non-policy comm unications to foreign intelligence approve all

distributed groups.

services and Government departments, publications, particularl y those outside the Organization, produced by

and to

to be

their

(b) Duty statements which do not expressly confer authorit y for

the communication of in te 11 igence, but use express ions such as 'maintain liaison', 'repre sent He adquarters' and 'provide advice' with or to other depart me nts and agencies.

(c) Statements of branch functions which use expressions similar

to those found in duty statements to describe functions the

177.

carrying out of which impliedly involves the communication of intelligence.

(d) Specific instructions have been issued on sensitive matters but generally with the intention of limiting rather than conferring authority to communicate intelligence, e.g. instructions in relation to passage of information

concerning Australian citizens to foreign liaison services and in relation to handling requests for information from people in the private sector.

8.45 After I raised questions about the authority under which particu lar officers had acted in communicating intelligence to other agencies, consideration was given to the question within ASIO. The Organization's legal officer subsequently recommended

that positions requiring an authority to communicate intelligence be identified and that duty statements be amended accordingly. I agree that this should be done. Whatever the precise requirements of s.l8, it is important that officers of

the Organization, if they are to communicate intelligence, have an express and clear authority to do so, and that there be no doubt on the part of other staff about their lack of authority.

8.46 I should add that my inquiries do not indicate that intelligence has been communicated outside the Organization in cases where that course was not appropriate, or that such communication has been made or otherwise authorized at an

inappropriate level of authority except possibly in the case of a small number of apparent leaks of information to the media.

Communication to government agencies 8.47 ASIO's communication of security intelligence to Government agencies, within which term I include Ministers, is limited.It publishes a fortnightly digest of securit y

intelligence for the Attorney-General, which is also sent to the Prime Minister. The Director-General, and sometimes other officers, report from time to time to the Attorney-General, and

178.

in the course of

collected by ASIO communication may activities to the

those reports intelligence which has been may be communicated. The purpose of the

merely be part of the reporting of ASIO's responsible Minister, or it may be the communication of intelligence in respect of which ASIO seeks action on the part of the Attorney-General.

8.48 In important matters, the Director-Genera l and sometimes other ASIO officers may report direct to the Prime Minister. The report of the Director-General to the Prime Minister in respect of the Ivanov/Combe affair is an example of such a report. These

reports would normally involve the comm unication of

intelligence. ASIO sometimes communicates intel ligence to other Ministers, although this is not common. It may have to report to the National and International Security Committee of Cabinet as happened in the Ivanov/Combe case.

8.49 ASIO communicates intelligence to the Departments of Prime Minister and Cabinet, Foreign Affairs, Defence, Immigration and Ethnic Affairs and sometimes other Departments when their interests are involved. It also communicates intelligence on

appropriate matters to the Protective Services Co-ordination Centre, and to the various intelligence services of the Commonwealth. Much of this intelligence relates to terrorism and other forms of politically motivated violence, particularly 1n

relation to the protection of holders of high office.

warrants under the 8.50 For provisions the

of

purposes the ASIO

of obtaining Act and the ~elecomm unications

(I t t ∑ ) A t 1979 1' t 1∑ s necessary for ASIO to make a n ercep 1on c , formal written application to the Attorney-General in case for the grant of the warrant is argued∑ This involves the communication of intelligence

which its

procedure to the

Attorney-General. At times he requires more is provided to him.

information, and it

8.51 The furnishing by ASIO of security assessments

of

179.

individuals to Commonwealth agencies may involve the

communication of intelligence. If there is an appeal to the Security Appeals Tribunal, the relevant intelligence is given as evidence before that body. On some occasions ASIO gives advice and communicates intelligence in respect of individuals in circumstances outside the definition of security assessments in

the Act. In recent years the number of these cases has been small. One was the case of Mr Combe, referred to in my term of reference (c). The case of Professor Hidaka, discussed above (8.12 et seq), involved a security assessment but in

circumstances where no independent review was available.

8.52 From time to time ASIO gives advice on security topics to departments and Government authorities pursuant to the provisions of s. 17 ( 1) (c). At times this involves the

communication of intelligence to those departments and authorities. One form the advice takes is the threat assessments that are provided to the Protective Services Co-ordination Centre and to police and other authorities (discussed in Chapter 5) " Sometimes the advice sought relates to a security

leak when ASIO may act either by itself, or in conjunction with the Australian Federal Police.

8.53 I have the

by

course ASIO

of

which my inquiries any was outside the communication provisions of

not found in

of intelligence the ASIO Act or was otherwise improper. Indeed some complaints have been made

communicate intelligence. Sometimes grounds, and sometimes it would justified.

about the

not

ASIO~s

refusal appear

reluctance to was on proper

to have been

8.54 An example of the correct refusal by ASIO to provide

information is when a department seeks information about an organisation which ASIO does not regard as having any security relevance. An example of a case where, in my opinion, the

refusal or reluctance to provide information would be unjustified is where ASIO has received liaison intelligence with

180.

some restriction on communication imposed, but a situation

arises where police action is necessary and the communication of

the intelligence, which undoubtedly relates to security, is

critical for operational purposes.

8.55 ASIO does not collect intell igence merely to sto re it . I t

is there to be used. If intelligence has been obtaine d from a liai son service on conditions imposing restrict ions on commu nication, or from any other source when comm un ication of

the intelligence might create problems, ASIO must nonetheless

give priority to urgent needs such as the taking of proper steps

to stop terrorists or similar violent activity even at the

risk of endangering the relationship with the liaiso n service or

other source.

8.56 O utside legality and propriety, questions of reli ability

and correctness remain. As has been noted elsewhere, evidence in

relation to the Commission 1 s term of reference (c) revealed that ASIO had adopted practices for the collation, assess ment and

reporting of intelligence without proper checks being made on

the reliability and correctness of what was repo rted. This

situation compares unfavourably with that adopted in relation to

the preparation of material for presentat ion to the Security

. ~peals Tribunal. I recommend elsewhere, and I here repeat, that

:Procedures and standards similar to those adop ted for the

:; preparation of material for the Security Appeals Tribunal should

lbe adopted in all cases where any person ma y be adversely

∑affected by ASIO 1 s actions, reports or advice. Such a system

∑;might sometimes slow down the information flow, but what delay

'might be involved is more than offset by the resulting accuracy

i and reliability.

1 Co mmu nication to police forces

;! 8,57 ASIO's communication of intelligence to

:State and Territorial police forces was :!recommendations were made concerning it,

:i agreernen ts between the Commonwealt h

181.

considered inc lud ing

and the

Commonwealth , by RCI S, and

the mak ing of

States or

Territories in relation to any communication of intelligen ce, either by ASIO or by the police. Agreements to this end are now in force between the Commonwealth and the States of Queensland, South Australia, Western Australia and Tasmania and the Northern Territory.

8.58 The agreements are similar in form (see Appendix H). They limit the intelligence which ASIO and police may communicate to each other, but leave it to each body (or its responsible Minister) to decide what intelligence, if any, should be communicated. Agreements have not been entered into with the States of New South Wales and Victoria, and no agreement has

been ∑sought with the Australian Federal Police.

8.59 The exchange of intelligence which takes place now whethe r an agreement exists or not is very much more limited than occur red before RCIS. To a large degree, dealings between AS IO and the police relate to terrorism and the protection of holders of high office. Information is exchanged on:

activities of targets of joint interest; demonstrations or other activities which may tend to violence; other matters relevant to the safety and protection of holders of high office.

8.60 ASIO on occasions receives limited operational assista nce from, and participates 1.n joint operations with, some forces, I and it is able to have checks made of some police records.

Reference was made in Chapter 5 to ASIO's role in

Commonw ealth/State counter-terrorism arrangements, including its

provision to police forces of monthly threat assessments and its 1 provision of certain training and technical assistance. As indicated below, ASIO is authorised under its Act, and does from time to time, pass on to police information about criminal offences that it collects incidentally to its collec tion of other intelligence.

18 2.

8.61 My staff and I have discussed with officers of the various

police forces their information that relations with ASIO and the nature is exchanged. I am satisfied that

of the

where

agreements police is

agreements within the

exist, communication of intelligence by ASIO and by in accordance with those agreements, and where do not exist the communication of intelligence is limits of the agreements which do exist. In many

is communicated to pol ice forces by forces to AS IO, although the pol ice

respects more ASIO than by

intelligence the pol ice

provide ASIO with important intelligence the protection of holders of high office.

which is relevant to

8.62 Relations between ASIO and the police forces appear to be

generally satisfactory, particularly at the level of personal contact. Some ASIO officers, perhaps from among those who have had less contact with the police, harbour some reservations. It

is important relationships up directly

for ASIO to overcome any obstacles in its by discarding any inherited attitudes and

with the police any problems that need

police taking to be

resolved. The contact between ASIO and police officers through their work together in meetings, exercises and training courses under the counter-terrorism arrangements are regarded on both

sides as useful in engendering mutual understanding of, and ~ confidence in, their respective roles .

" 8.63 ASIO has an officer in Canberra who acts as a liaison

~" officer with the

Australian Federal Police. This officer mPerforms a valuable function. Where it is not feasible for a .regional director himself to perform a similar role with a State

~ or Territory force, consideration should be given to designating

.a similar liaison officer. It is important to engender as much

trust as possible, on both sides, in such a relationship.

'18.64 ASIO, for its part, will from time to time acquire

:asensitive information which, by its nature, should be conveyed ∑lto the police for operational purposes. A working relationship

lhas to be established, and confidence built up on both sides, if

18 3.

effective communication is to take place particularly when there may be awk\vard problems such as restrictions

intelligence by an overseas liaison service. The their part need to exercise constant care in the sensitive intelligence information passed on by

placed on

police for handling of ASIO and be

careful not to overlook, in relation to any threatened or actual act of terrorism, the assistance there is to be had from ASIO.

8.65 A positive step, which might help overcome suspicions and build up better understanding of the respective roles of AS IO and the police, would be to seek to arrange secondments of officers from one to the other. A seconded officer should work

in an intelligence role in the other organisation rather than perform a liaison role. Experience of that kind gained by ASIO officers would make them alive to the need of police forces for intelligence which ASIO holds, and for it to be communicated

quickly to meet developing situations and operational needs. There could be advantage in a secondment from a police point of view too. I recommend that ASIO and the AFP, for a start, should consider an arrangement for secondment of an officer from one to

the other.

8.66 Overall, there do not appear to be any particular problems / in the relations between ASIO and the various police forces. The relationship is a mutually advantageous one - each can offer the other assistance of value. There is a need for care, common sense and goodwill on both sides to ma1nta1n effective working / relations. The inter-governmental arrangements, where they exist, provide a desirable mantle of authority and clarify the extent of the relations. I recommend that the Commonwealth take up with New South Wales and Victoria again the question of

entering agreements with them similar to those entered with the other governments. It may be that changes which I am

recommending in ASIO's statutory charter will facilitate the reaching of agreement with those States.

184.

Communication to foreign liaison services 8.67 An important source of security intelligence to ASIO is

from its overseas intelligence 1 ia ison connect ions. This source

is singularly important in the area of terrorism. ASIO has a ' form of liaison, in some cases quite close, with quite a large

number of overseas services. The foreign services are listed in

ASIO's classified Annual Report to the Attorney-General.

8. 68 ASIO also participates, with the knowledge of the

Attorney-General, in a number of regular international conferences with other services.

8. 69 As I reported in RCIS and as is apparent, if ASIO is to

obtain intelligence from foreign services which is relevant to security within Australia it must be prepared to reciprocate by providing those services with intelligence relevant to the security of their countries. This reciprocity generally does not create problems when the intelligence does not relate to Australian citizens and residents but care must be taken if it

does. ASIO requires that both the request for any such

information and the proposed text of any communication should be approved by the Deputy Director-General before the communication

takes place.

8.70 There are varying reasons for providing liaison services

with intelligence about Australians. The request would commonl y

concern an Australian about to visit the country of the inquiring liaison service, but it is not limited to this class of case. The authority of ASIO to co-operate with these overseas

services is to be found in s.l9(c) and is subject to any arrangements made or directions given by the Minister. In any doubtful case, ASIO should obtain the Minister's approval for the communication. In any event, the issue may be an appropriate

one for the issue by the Attorney-General of guidelines.

8. 71 My inquiries have not revealed any case since RCIS when ∑ f 1∑ ∑son service. It was

ln ormation was improperly given to a lal

185.

reported in The National Times of 6-12 May 1983 that, in an unpublished supplement to a report of RCIS, it was stated that members of ASIO had handed over potentially damaging information about prominent Australian figures, who were or included Australian politicians and senior officials regarded

unfavourably by ASIO, to American authorities and in particular to the CIA. No such statement, nor any part of it was made by me in any published or unpublished report or supplement of RCIS.

The allegation was wholly incorrect.

8.72 I recommend that:

(a) having regard to the requirements of s.l8 of the Act, ASIO amend duty statements or otherwise provide express authority for those officers who are authorised to communicate intelligence outside the Organization;

(b) A_S_I~O--~c_o_n_s __ i_d_e_r ____ d_e_s __ ig'-n_a _t_i _ n_ g~ ___ l_i_a_i_s_o_n ____ o __ f_f_i_c_e_r_s ____ t_o ____ a __ s_s_u_m~e particular responsibility for relations with police forces other than the Australian Federal Police (for which there is already a liaison officer};

(c) ASIO explore with the Australian Federal Police the scope for secondment from time to time of ASIO officers to work with the police (and perhaps of police officers to work with ASIO);

(d) Consideration be given to the formulation of guidelines, which might be issued by the Attorney-General, on the circumstances in which it may be proper to Erovide

intelligence about Australian citizens or residents to foreign liaison services.

Communication of incidental intelligence 8.73 It is not a function of ASIO to collect or communicate any intelligence other than that which is relevant to security. Thus it cannot employ an agent to collect 'non-security' intelligence

186.

or to seek this intelligence from a contact. Likewise it cannot

obtain a warrant from the Attorney-General under Division 2 of Part III of the ASIO Act to intercept a telephone (or to do any

of the other things which the provisions of that Division

authorise ASIO to do) for the purposes of collecting

" non-security " intelligence.

8.74 It is obvious that notwithstanding this limitation on

,ASIO " s intelligence collect ion functions, it will, as an

inc ident to its collection of security intelligence, collect

:mu ch information which is not relevant to security. Thus an

agent, reporting to his case officer, will often report on a

" great many matters which are not of security relevance; and

possibly the greater part of intercepted telephone conversations

have no bearing on security. This receipt of irrelevant information by ASIO is unavoidable.

8. 75 The ASIO Act recognises the existence of this incidental

collection in two ways. Section 31 of the Act provides that

where, by virtue of a warrant under Division 2 of Part III , any

record or copy has been made and the Director-General is

satisfied that that record or copy is not required for the

purposes of performance of functions or exercise of powers under

the Act, the Director-General shall cause the record or copy to be destroyed. (There is a similar provision in s.l4 of the

∑ _Telecommunications (Interception) Act 1979). The wa y in wh ich

,ASIO responds to this requirement is discussed in Chapter 6.

8. 76 Authority to communicate information that has come into

the possession of ASIO in the performance of its functions under

s.l7, although that information does not relate to security, or

does not relate solely to securit y , is given to ASI O by s.l8 ( 3)

of the Act.

8.77 Section 18(3) provides:

Notwithstanding paragraph 17 (1 ) (b), the D irector-General may, in accordance with the following paragraphs, by hims elf

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8.78

or by an officer authorized by him, communicate information that has come into the possession of the Organizat ion in the course of performing its functions under section 17:

(a) whe re the information relates, or appears to relat e, to the commission, or intended commission, of an offence against the law of the Commonwealth or of a State or Territory, being an offence punishable by imprisonment

for life or for a period, or maximum period, of not less than 3 years - the information may be communicated to an officer of the Police Force of a State or Terri tory or to a member or special member of the Australian Federal Police;

(b) where the information relates, or appears to relate , to the commission, or intended commission, of an offence punishable as provided by section 235 of the Customs Act 1901 - the information may be communicated to a memb er or special member of the Australian Federal Police for the purposes of investigations into the offence; or

(c) where the information has come into the possession of the Organization outside Australia or concerns matters outside Australia and the Director-General is satisfi ed that the national interest requires the communication -the information may be communicated to a Minister or Depa rtment or to the Office of National Assessments.

The purpose of this sub-section is obvious, and in my opinion the communication which it authorises is completel y justified. It applies to information which ASIO has incidentall y obtained in the course of collecting other information, whe ther pursuant to a warrant or not, and which although not relevant to security is of a kind that in the public interest should be communicated to an appropriate officer of the Commonwealth or of a State or Territory. However the particular provisions of the

paragraphs in the sub-section give rise to practi cal difficulties which limit significantly its intended effect.

8.79 Paragraph (a) concerns information which relates, or appears to relate, to the commission or intended commission of criminal offences which are punishable by certain periods of imprisonment. Having regard to the complexity and detail of the criminal law of the Commonwealth, of the States and the

Territories, ASIO would (and does) have considerable trouble in exercising this power except in the clearest cases. It would be

18 8.

necessary for ASIO to have a staff of skilled criminal lawyers to make effective use of the power in its present form.

Information that could and should be passed to the police may well be withheld because of doubts about the position under the legislation.

8.80 The reason for the reference to periods of imprisonment in the paragraph was presumably that it was not thought appropriate that ASIO should pass on information about trivial offences or

about offences regarded as not being serious. Although a general criterion of 'seriousness' is loose, and is undefinable with precision, it is a much more practical one than a crite rion dependent upon the periods of imprisonment by which an offence may be punishable.

8.81 It would be relatively easier, monitor of a telephone conversation or recognise that conduct of an apparently

for example, for the for a case officer to criminal nature being

spoken about on the telephone or by an agent involved a serious offence, whilst he may have no knowledge at all of what the particular offence may be or what term of imprisonment could be imposed for it. A senior officer to whom the matter was referred could well be in no better position.

8.82 If it is desired to make the provision operate

∑effectively, it should be amended by deleting the refecences to

particular periods of imprisonment and, if a qualification is required, by inserting the word 'serious' before the wo rd 'offence'. I have concluded that no qualification is necessary , and that

discretion, the

to

Director-General should be communicate inadvertently

given a

coll ected general criminal

intelligence, although he would be concerned to do so only whe re the crime appeared to be serious. Guidelines by the

Practl ∑ca l assist ance, if it Attorney-General could give some were needed, in identifying the relevant offences. It must be borne in mind that the provision is one which has no operation at all, save to authorise the communication o f information to a

189.

police force. If ASIO does obtain information about what appears to be a serious offence there is clearly good reason why, in the public interest, that information should be communicated to a police force. In my view it is important that the provision be amended to make it workable.

8.83 Paragraph {b) relates to the commission or intended commission of an offence punishable under s. 235 of the Customs Act 1901 . Section 235 fixes penalties for offences created by other sections of the Customs Act, but which also satisfy conditions laid down in s. 235. The relevant offences relate to the import or export of or other dealings in narcotic

substances. Whether an offence is punishable under the section depends, inter alia, on whether there are conditions attached to a licence to import or to export narcotic substances which have

been breached, whether particular quantities - which may be what is called the 'commercial quantity' or the 'traffickable quantity' applicable to the particular narcotic substance - are involved in the transaction, or whether the purpose of the transaction relates to the sale of or other commercial dealing

in the narcotic substance.

8.84 It is conceivable, though unlikely, that the incidental information which ASIO obtains will show whether these

particular conditions are or appear to be satisfied. It is much more likely that the information which ASIO obtains will merely show that an importation or other transaction with respect to

narcotic substances has taken place or will take place and that some offence has been or will be committed, and what persons or

places may be identified. Precise amounts of the substance involved and the other matters which must be shown to exist before s.235 applies will generally not appear from the information available to ASIO. ASIO's information could be invaluable to the Australian Federal Police when added to other information in their hands, or it may suggest to them an entirely new line of inquiry. However ASIO must act under the paragraph, if it acts at all, simply on the basis of the

190.

information which it has, and this will commonly fail to satisfy the provisions of the paragraph.

8.85 The inclusion of a special paragraph dealing with d rug offences was probably due to the role of Customs officers with investigation of those offences. Now that they are investigated by the Australian Federal Police, there seems to be no reason to

deal with them separately. If my recommendation about s.l8(3) (a) is adopted, it would be appropriate to delete paragraph (b) and leave intelligence about drug offences to be dealt with under paragraph (a).

8.86 Paragraph (c) is in general terms and relates to

information that has come into the possession of ASIO out side Australia or concerns matters outside Australia, and the Director-General is satisfied that the national interest requires that it should be communicated to a Minister, a

department or to the Office of National Assessments. Although it may apply to other forms of intelligence, it is clear that the

paragraph applies to what is commonly called foreign

intelligence, that is, intelligence about the activit ies, capabilities and plans of a foreign country, whether they be of international relations, defence, economic or other national significance.

8.87 In the course of its intelligence collection, whether from

agents or activities authorised by the Attorney-General's warrant, ASIO may collect useful intelligence of this kind. Whilst the practical usefulness of the paragraph may be limited , it is a useful and important power that ASIO can exercise in

appropriate cases in the national interest, and it should be retained whether or not ASIO is g iven the pow e rs to collect foreign intelligence which I recomme nd in Chap ter 6.

8 0 88 Section

information by authorised by

18 ( 3) authorises the Director-General the co mm u n i c a t ion himself, o r by an

of the

officer

h

. Alth h I doubt whether the sub-section ~m. oug

191.

requires a separate authority to be given in the case of each communication under paragraphs (a) and (b), it would seem that the Director-General has no power to delegate to another officer the making of the decision required by paragraph (c) as to the national interest. If full use were made of these provisions, it would be impracticable for the Director-General to deal with each case himself. It would be necessary for him to give general authorities to other officers of the Organisation to make the communications and to form a view as to the requirements of the national interest for the purposes of paragraph (c). The sub-section should be amended to make clear that the

Director-General has these powers of delegation.

8.89 I recommend that:

(a) s.l8(3) (a) of the ASIO Act be amended to enable ASIO to pass on to a police force information that appears to relate to the commission of any offence; and the Attorney-General could, if thought necessary, describe in guidelin~s offences of a petty nature in respect of which it would not be

appropriate for ASIO to pass to the police information which it had obtain incidentally;

(b) s.l8 ( 3) (b) be deleted and intelligence about drug offences de a 1 t with under s . 18 ( 3) ( a) ;

(c) s.l8 ( 3) (c) be amended to ensure that the judgment required of the Director-General that the national interest requires the communication of foreign information is a judgment that the Director-General can delegate.

19 2.

II

CHAPTER 9

SECURITY CHECKING FOR ACCESS

Clearance system for access 9.1 ASIO's protective security functions include the security assessment of individuals requiring access to national security information or to areas which are controlled on national security grounds.

9.2 In inquiring into ASIO's role, I have found it necessar y to consider the whole system of clearance by Commonwealth bodies of staff or other people requiring access to such information or areas. ASIO's security assessments form a significant part, but

not the whole, of that system. What ASIO does cannot be fully understood, or reviewed in a meaningful way, without examining the system of which it forms a part.

9. 3 The

partly on present system is based partly on legislation and administrative arrangements. The ASIO Act regulates role in the system and makes provision for independent

of ASIO's security assessments. In addition to the ASIO's review provisions in that Act, the system is derived from:

the 'Commonwealth Security Assessment Manual Security Assessment Procedures for Persons having Access to National Security Information or Secure Areas' prepared under the authority of the Attorney-General for the guidance of officers of the Commonwealth and Commonwealth agencies

responsible for the processing (issued in June 1980); of security clearances

the following determinations (regulating ASIO 's assessments) made by the Director-General of Security in consultation with the Attorney-General under s.37(4) of the Act:

19 3.

Determination No. 2 - Access Determination No. 3 - Uncheckable Background Determination No. 4 - Narcotics;

the Personnel Assessment Manual Personnel Assessment Procedures and Guidelines (including procedures for police records checking for persons having access to national security information or secure areas) prepared by the Public Service Board for use in relation to staff under the Public Service Act (last revised in September 1981);

the Protective Security Department Manual prepared by the

Attorney-General's direction; and issued by ministerial

such additional guidelines or directions as individual agencies may issue to clarify their own approach within the system.

9.4 The system has the following main features:

(a) security clearances are required prospective occupants of positions, and the Commonwealth or their employees,

for occupants or

for contractors of if they will have

access to national security information which is classified confidential or above, or to a secure area;

(b) the responsibility for deciding whether to grant a person a

security clearance lies with the head of the agency by which the person is, or is to be, employed (and with the head of the sponsoring agency in the case of contractors);

(c) the employing agency is required, before seeking a security assessment from ASIO, to satisfy itself, in accordance with guidelines issued by the Public Service Board and any departmental requirements that the person is suitable for a security assessment position on all other grounds (the

194.

Public Service guidelines refer to t ∑ b ac 1on y an agency to verify personal particulars check of police records

and identification, to seek a and to consider personal

characteristics affecting loyalty and reliabi lit y);

(d) ASIO carries out an assessment of the person by reference to

its records and, in appropriate cases, to the results of records checks requested from foreign services with which it 1s in liaison, as well as in certain cases to the results of an interview of the person and, in rare cases, of referees;

(e) ASIO provides its assessment, expressed in favourable, qualified or adverse terms, to the employing agency;

(f) the employing agency is required (unless exempted on

security grounds by the Attorney-General) to notif y a person subject to a qualified or adverse assessment of the terms of that assessment, and the person is entitled to seek a review of the assessment by the Security Appeals Tribunal (SAT );

(g) on receipt of the ASIO assessment, and subject to any review

by SAT, the employing agency decides whether to grant the

person a security clearance; ASIO' s advice constitutes advice only, and is not binding on the agency , although in certain circumstances a decision of SAT on the review of an assessment may become binding;

(h) in addition to the process outlined above, a special form of

l t (Absolute) 1

. s required for access

c earance - Top Secre

to certain specially designated information ; this form of clearance is issued by the Depa rtment of Defence on the basis of an additional suitabi lit y assess ment conducted by the Office of Special Clearances and Records (OSCAR)

in that Department. The suitabilit y assessment is face-to-face nominated

wide-ranging and thorough, and includes in-depth interviews with the subject, with and with a cu rrent or previous

and unnominated referees

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employer, subject's checks.

supervisor financial or educator, an investigation of the circumstances, and extensive records

9.5 The requirement for a security assessment frequently (but not always) arises in conjunction with, or as a consequence of, a staffing decision, such as a decision to employ a person, or

to transfer or promote a person. Decisions of that kind normally involve assessment of the suitability of the person for carrying out the duties of the position in question. Suitability in that context may of course cover character aspects such as

reliability as well as specific job related requirements such as qualifications and skills. To some extent, therefore, there may be overlap in matters to which consideration is given in assessing suitability for employment purposes and for access purposes.

9. 6 The security assessment system is however designed to be discrete and in practice is administered separately. Notwithstanding that particular matters may be relevant to both processes, I am of the view that they should continue to be administered separately, in order to keep clear the criteria for assessment which may differ.

Responsibility for issue of clearances 9.7 As indicated above, the head of the employing agency bears the responsibility for deciding whether to grant a security clearance to a person requiring access to national securit y

information or to a secure area in the agency. While ASIO contributes to the process by way of a security assessment, that assessment is in the form of advice only to the head of the agency. I regard this position as sound in principle.

9.8 It is

individual security of

consistent with the Ministers and agencies matters within their

196.

general approach by are responsible for charge. This subject

which the

was

considered by me in the Report of the Protective security Review. I repeat the conclusions reached there, and to which I still adhere:

The Commonwealth government is, in the final analysis, responsible for the manner of its administrat ion. Individual ministers are individually answerable. They are responsible for protective security arrangements of Commonwealth departments under them, and, according to the degree of

independence of authorities, for them also. (11.36)

Nevertheless, the great bulk of the day to day work of departmental protective security is done within the department and the permanent head carries a very significant statutory responsibility for the protective securit y of the department he heads. He and his senior officers have

responsibility for managing their department properly, whatever guidance, assistance and support they do or do not receive. (11.38)

Thu s the

ultimate As part

individual Minister, through his agency head, bears the responsibility for protective security within his area. of this responsibility, it is appropriate that the agency head, rather than an outsider, should decide whether a

person for whom the agency has, or will assume, a responsibility

is to be given access to sensitive information or areas.

9.9 ASIO is precluded by the Act from making decisions on the

granting of security clearances-other than clearan ces of its

own staff (or contractors undertaki ng work for the

Organization). Section 17 (2) provides that it is not a function

of ASIO to carry out or enforce measures for security within an

authority of the Commonwealth. In my view, the granting of a

security clearance is clearly

limitation on ASIO' s functions retained.

a

is

measure for securit y . This important and it should be

9.10 One consequence of course of the distribution among agency

h ∑ ∑ of clearances, rather eads of responsibility for the 1ssu1ng than having it centralized, is that the standards applied may h t the issuing of

vary. There is a risk that a lax approac 0

clearances in one agency may harm the security interests of the

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Commonwealth beyond that agency, e.g. people cleared by one agency may have access to information held by it but which originated from or is otherwise of primary concern to another agency.

9.11 This points to the need for the clearest possible standards and guidance to be issued to agencies. I express the view below that there is scope for some improvement in this respect.

9.12 It is understandable also that the head of an agency who is likely to is heavily involved in national security matters requirements of national have more feel for the security than the head of an agency whose involvement in such matters is more spasmodic. The latter category of agency heads, in particular, could be assisted by having someone to whom they could turn to discuss the handling of a difficult or unusual case. I should think the Secretary to the Department of the Prime Minister and Cabinet would be an appropriate person for this purpose by

reason both of his Department's responsibilities for co-ordination and his own position in the management of the intelligence community.

9.13 I recommend accordingly that agency heads be encouraged to discuss with the Secretary to the Department of Prime Minister I and Cabinet the handling of those security clearance cases ~: Ill ) which awareness of wider cons ide rat ions, or experience, may j of assistance. 1 )

Criteria for clearance I

9.14 There is a lack of clarity at present 1n the guidance given to an agency head on the criteria by which he is expected I to determine whether or not to grant a security clearance.

9.15 The Protective Security Manual states that favourable results from the appropriate checks may not necessarily mean that a person is suitable for authorisation for access to

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n

classified matter. The agency head is to be satisfied 'that persons proposed for authorisation for access have suf.ficient maturity and discretion to understand their personal responsibility for security'. The Manual continues:

A person whose conduct may be exploited because it is

unlawful or if exposed may result in some personal

disadvantage or whose conduct may indicate a significant defect in reliability should be authorised for access only if after consideration of all the circumstances including the level of access, it is judged that the risk

involved is acceptable.

1

This Manual in some respects provides clearer guidance on the criteria for clearance than the Security Assessment Manual and the Personnel Assessment Manual which purport

authoritative texts on security checking. to be the

9.16 The Security Assessment Manual provides that, the agency head before is to seeking a security assessment be satisfied that the person

assessment) position on all guidelines issued by the

from ASIO, 'is suitable for other grounds in Public Service

departmental requirements' (para. 3 (a)).

such a (security accordance with Board and any

9.17 The Personnel Assessment Manual indica tes that the agency

head is to be 'satisfied on the basis of

the available

information that the person is reliable and trustworthy' before seeking an ASIO security assessment.

9.18 As indicated below, I consider that the requirement to be

satisfied that the person appropriate. If that is the so stated in the Manual. It test to be applied when

is 'reliable test, however, and trustworthy' is it should be clearly should be made clear that it is the

the agency head makes the final

determination, not just at

∑ ASIO' secur 1' ty assessment, and after receiv1ng s

the interim stage when the agency proceeds to request a security assessment from ASIO.

199.

9.19 The relationship between the various manuals, and the guidance given in them, needs to be clarified. I note also that it is not clear whether the guidance provided in the Personnel Assessment Manual is applicable in respect of people who are not employed under the Public Service Act 1922. The Manual states

that it has been prepared for use in relation to staff under the Public Service Act. I am not aware of any comparable guidelines of general application to staff who are not so employed, although particular agencies may have adopted their own guidelines along similar lines.

9.20 ASIO for its part is provided with statutory guidance. The effect of the definition in s. 35 of the ASIO Act is that a security assessment by ASIO is a statement of advice to an agency on the question 'whether it would be consistent with the requirements of security' for a person to be given access to security information or a security area. I regard 'security' in this context as being confined to its defined meaning in s.4 of the Act.

9.21 In other words, ASIO has to consider the question in terms of the protection of the Commonwealth and its people from espionage, sabotage, subversion, active measures of foreign intervention or terrorism.

9.22 Although these statutory considerations bear very directly on the granting of security clearances, they do not adequately express all of the relevant considerations.

9.23 In essence the question becomes one of trustworthiness, in the sense of whether a person is worthy of the trust that must I be placed in anyone given access to national security

information or areas. (The level of trust called for may vary with the sensitivity of the information or the area. I deal with this question under standards of checking}.

200.

9.24 In this context, I see the main elements of

trustworthiness as being:

reliability whether a person may be relied on i.e., whether he is of sound and consistent character or quality; and

loyalty in the sense of faithful allegiance to Australia and its constitutional form of government;

so far as those characteristics may relate to security. Maturity and discretion, as referred to in 9.15, should be comprehended

by r e l i a b i l it y "

9 " 2 5 In RC IS I wrote ( 4 : 1-2 7 3) :

Security Assessment criteria may relate to loyalty, or to reliability, or to both. And, although there may be other matters, for the most part the matters to be considered are:

(a) Associations and other circumstances which establish the existence or indicate the likelihood of present disloyalty. (b) Associations and other circumstances which may indicate

the possibility of present disloyalty or which may lead to disloyalty. (c) Character and related defects which may lead to, or may be used to induce, disloyalty.

(d) Character and related defects which may establish or indicate unreliability, but not necessarily disloyalty.

Generally speaking the matters referred to in (a) to (c) relate to espionage and the other aspects of security as defined in the

ASIO Act.

9.26 The matters in (d) - which go to reliabilit y - relate to

security in a those bearing

broader sense. They are no less important than on possible disloyalty. Indeed, in a practical 'k 1 t put national security sense, they may be more 11 e Y o interests at risk. I have in mind for example such traits as a

201.

propensity for loose talk or plain carelessness which may impinge on the protection of classified information or the maintenance of security procedures. The disclosure of secrets or the exposure of secure areas to risk through inadvertence or carelessness can result in just as much damage to the nationa l

interest as can result from espionage or sabotage. Lack of I truthfulness in a person can itself impair the capacity of those in charge to assure themselves that security is being maintained.

9.27 I recommend that for determining whether or not to grant a security clearance, a test be clearly laid down for agency heads to apply. That test should be whether (on the basis of all facts and circumstances known to the agency following a prescribed process of inquiry, and not just of ASIO's security assessment), 1 the granting of a security clearance would be consistent with the requirements of national security having regard to the I person's reliability and loyalty. (The nature of the checking ~ 1 called for, and the degree to which an agency head is required

to be satisfied that the test is met, may vary according to the level of clearance. I discuss these matters under standards of checking).

Allocation of responsibility for checking 9. 28 There is at present a bifurcation, but some overlapping, of responsibility for carrying out the checking required before the granting of a clearance. There is also a lack of clear understanding in some quarters about the differi ng

responsibilities.

9. 29 The employing agency is responsible for verification of personal particulars and identification, and for seeking a check of police records where required. It is required also to consider the suitability of the person on all other grounds than

those that are assessed by ASIO. The Personnel Assessment Manual makes it clear, in relation to staff employed under the Publi c Service Act, that the agency's consideration is to extend to personal characteristics affecting loyalty and reliability.

202.

II

9.30 The Manual offers the following rationale for examining such characteristics:

Any characteristic which renders an individual susceptible to indiscretion, pressure, blackmail or inveiglement may be seen as possibly affecting that individual's loyalty and/or reliability.

9.31 Facts to be considered by the Department include criminal convictions, including pending charges, pecuniary penalties and illegal behaviour. Personality traits and private behaviour are also stated to be possibly relevant. Other factors include use

of intoxicants and drugs, dismissal from previous employment,

false statements and breaches of Departmental instructions.

9.32 ASIO on the other hand carries out its assessment by reference to the elements of security as defined in the ASIO Act. In many cases ASIO " s 1 assessment 1 is based solely on a check of its records, with further inquiry made only if there is

in the records a reference or link, of possible security

interest, including to or with the person assessments for top

in question. In other cases secret clearances ASIO also

interviews the person. On rare occasions referees will be interviewed.

9.33 The overlap of responsibilities and lack of understanding in some quarters relate particularly to the checking of personal

circumstances and characteristics.

9.34 The employing agency is expected to direct its attention

to these matters. ASIO, while its position is somewhat

equivocal, does so too. A determination which has been made by the Director-General under s. 37 (4) directs the Organization to take account of matters or characteristics tending to make an individual vulnerable to blackmail or other improper pressures and to matters going to a person's loyalty, honesty, discretion

and reliability. Attention is also directed to the person's

previous employment history and associations.

203.

9.35 Yet

instructions it appears ftom that ASIO does

various internal not pursue such somewhat diffident

memoranda an(

matters in an ~ about becomi n ~ detail and in fact appears involved in personal matters. By way of illustration I refer t< the following excerpts from Part D of the ASIO Staff Manual Volume 3:

43. Conscience may be useful

experienced a conscience and probe what his

arise. . . .

Issues If the situation is appropriate, i∑ to discover if the applicant has eve: significant clash between his privat " departmental or Government policy, and t'

reaction might be should such a situatio 1

45. Personal Affairs - On a number of occasions applican t: have been remarkably frank in discussing their persona . affairs. In certain circumstances ASIO does have legitimate security interest in close personal relationshi p .!

into which applicants for positions involving nation a security information may have entered. For example, a clos ,, relationship between the candidate and a person of securi t:. significance or a foreign Government official would be matter for consideration in a security assessment.

46. Need for Discretion - Although the foregoing point i , sign~f1cant, 1t is also a sensitive issue and interviewi n " l

officers will need to exercise keen discretion. As a genera1 guide, all that needs to be established is whether a clos 1 personal relationship does exist and, if so, the identity o ~ the partner. No further attempt should be made to obtai

intimate details of the relationship as this would ad l little if anything to the assessment and leave ASIO open t ; the oft-repeated charge of unwarranted prying.

My inquiries have indicated that ASIO's interviews for To ~

Secret access tend to be brief (in the order of 20 to 30 min u t e ~ and sometimes less) and to deal with character and circumstanc e ~ in a cursory manner.

9.36 It has frequently been stated by officers of ASIO that th general character and circumstances of an applicant are matters of 'general suitability' not relevant to security. I find there is such a dichotomy in the and I should have thought that

for employment and, thus, it difficult to accept context of security check i all such matters having t

potential to be relevant to security should be regarded as su

204.

until, by inquiry, they are shown to be otherwise. The fact that such a matter is relevant to security does not mean that it is

such as to warrant denial of a clearance. It means no mo re than

that it is a consideration to be taken into account by the

agency head in deciding whether to grant a clearance .

9.37 T he diFficulty in drawing the d istinction, and the

potential for agencies not to be fully informed where ASIO determines the matter to be one of general suitability , is amply

demonstrated by the following paragraph taken from an internal

minute by an ASIO officer as to the form a security assessment

should take:

I believe there is still some basis for the belief that . ". has doubts about her ability to retain confidentiality of information she may obtain in the course of her emplqyment. That though, is basically an aspect which falls within the

area of general suitability. In the absence of any information which may be described as 'secur ity' information in the terms of the ASIO Act 1979, I consider that we could not justify the issue of a non-favourable assessment.

In the event a favourable assessment was issued by ASIO. The

result is that a consideration relevant to the granting of a clearance (putting aside whatever weight should

accorded to it) head because of

was not brought to the attenti on of the judgment that it was not

'security' as defined for ASIO's purposes.

have been

the agency relevant to

9, 38 The present Director-Genera l endorses the view taken by a moral

h ∑ d o ∑ t and should not be, 1s pre ecessor that ASI 1s no , policeman.

9.39 It seems to me that ASIO is

reluctant to become involved and charac ter partly for

in matters of personal circumstance f d

'ng into personal

ear of being accused of unwa r r ante pry 1

affairs. ASIO is also conscious of the possibilit y of having an assessment overturned by the SAT on the ground that character or not relevant to securit y as other personal matters are either

1 ent to justify a defined in the Act or are not sufficient Y cog

20 5.

qualified assessment. ASIO is able, with some justification, to take the view that character matters relate to 'general suitability' and should have been considered by the employing agency before an assessment was sought from ASIO.

9.40 I rega~d it as plain that an effective security clearance system requires consideration and checking of personal circumstances and characteristics, so far as they may go to a person's reliability and loyalty. A system limited to checking

for any involvement in or association with, or even

vulnerability to, espionage, foreign active measures etc would not be sufficient. The degree of checking of personal matters that is required may vary of course depending on the level of the clearance sought.

9.41 The British Prime Minister, in a statement in May 1982 on recommendations in a report of the Security Commission (HMSO Command 8540) said:

The Commission observes that character defects rather than disloyalty for ideological reasons or subversive tendencies have been the cause of all known cases of disclosure of information to hostile intelligence services that have occurred since Radcliffe.

(The Committee under Lord Radcliffe reported in April 1962.) Further than that, of course, as I have already stated, personal weaknesses or defects can lead to unwitting but equally damaging disclosures.

9.42 It appears to me that this aspect needs to be tackled more effectively. From inquiries made of some representative agencies, it seems that performance varies a good deal among agencies. A few are well aware of the responsibility that is cast upon them

circumstances and and are directing inquiries characteristics; others are not, to personal

in part it

seems because of a lack of appreciation of what is required of them and in part due to a lack of resources to do the job. There is a tendency for agencies to believe that ASIO will handle 'all

206.

that sort of thing' in any event. Understandably, agencies are not keen to become heavily involved in touchy areas of personal inquiry. In addition, they may have difficulty 1n finding the people, particularly people skilled in securit y interviewing, to carry out the task.

9.43 ASIO has referred to confusion in departments about the disti nction between the respective roles of the departments in considering general suitability for access and ASIO's role in security assessment. It said that in practice departments did

not appreciate the distinction between personal information which forms part of a person's loyalty and reliability

assessment, and personal information relevant to securit y which requires ASIO's attention. ASIO added that it was often confronted with situations where, in the course of its inquiries, it was informed of personal 'character' information which might affect a candidate's general suitability, which a

department should have determined before forwarding to ASIO a request for a security assessment.

9.44 ASIO's submission stated that:

Our experience has been that a number of departmental

security officers either fail to understand the separation of responsibilities [between ASIO and emp loying ~gency] or, if they do, to accept it. Although that som.etlmes . causes some problems for AS IO, the most serious cons 1der at1on must

be whether people who may be unsuit~ble for access, on

grounds other than security, are be1ng given access by default.

9.45 ASIO likewise, and with some justification having regard to the definition of security in its Act, has been reluctant to become too involved in this area. While not eschewing the

possible relevance of characte r defects to vulnerabilit y to recruitment for espionage, for example, they have not probed too far. While vulnerability of that kind is a consideration, it is

rather more tenuous than other indications of securit y interest. ASIO has been able to take the view that agencies have a

responsibility to consider wider circumstance and character themselves. 207.

questions of personal

9.46 Overall the position in regard to the checking of personal circumstances or characteristics going to reliability or loyalty is as follows:

(a) ASIO concerns itself with this area in a limited way with its focus on the potential relevance of personal aspects to espionage, sabotage etc: its checking is somewhat perfunctory:

(b) some agencies are doing little checking;

(c)

9.47

in those cases where agencies do deliberately, and particularly where interviews, there will be some overlap

pursue inquires more they conduct security of effort with ASIO's

inquiries and more intrusion into personal matters than may be necessary.

The present position is unsatisfactory. There is no sufficient assurance that broader considerations of reliability and loyalty, as distinct from the more specific security considerations of espionage, sabotage etc are checked and taken

into account in the clearance process. There is also an undesirable potential for overlap in an area of inquiry that is sensitive and intrusive. In my view there is a need for change.

9.48 The options appear to be as follows:

(a) broadening ASIO's role in the clearance process by directing it to consider a person's reliability and loyalty in the general context of security whether or not bearing on the person's involvement in, association with, or vulnerability

to recruitment for espionage, sabotage etc:

(b) limiting ASIO's role more clearly to consideration of specific aspects of security and emphasising the employing agency's responsibility for considering wider aspects of reliability and loyalty.

208.

(b) is preferred, there are further considerations If option relating to administrative arrangements for carrying out required to provide the agency head with information decision can be made. These include building checking which a

the

on

up

agencies' resources for carrying out personnel checking, on the one hand, and establishing a special personnel checking body to

carry out checks on behalf of other agencies, on the other hand.

9.49 Option

amendment of

inquiry. The

(a) widening ASIO's role would requir e

the ASIO Act to

recently enacted make clear the scope of ASIO' s Canadian Security Intelligence

Service Act empowers the Canadian security service to furnish to agencies security assessments - defined as 'an appraisal of the loyalty to Canada and, so far as it relates thereto, the reliability of an individual'. That definition is a useful basis. By relating reliability to loyalty, it would cover, for example, vulnerability to espionage by reason of character defect. However, it would not seem to cover carelessness or lack of discretion of a kind which, even on the part of a loyal

citizen, may endanger the security of information or o f an area to which the citizen is given access. The amendment of the AS IO Act would need to be along the lines of appraisal of the loyalt y

and reliability suitability of of

that a person

person to

so

be

far as relevant to the

given access to national

security information or areas.

9.50 While ASIO has had

inception, I do not regard suited because of this to particular advantage in

a security checking role since its

the Organization as necessari ly well carry out the wider role. I see no charging a body that is presently

focussed largely on rather specific aspects of secur ity to carry out assessments of personal matters relevant to security in a more general sense. ASIO does not have, for example, any

the l. 'nterviewing of persons being particular expertise in considered for security clearances that could not be developed by another body. It will not have the same fam iliarit y with the

209.

person subject to clearance as will often be had by an employing agency.

9.51 In other countries, vetting investigations are commonly conducted not by the security services but by specialised checking authorities. A wider role would distract ASIO from its central functions. Further, the very involvement of a security service in wider inquiries could give rise to concern by those affected. It is not a role that ASIO seeks. It is not a role that I favour for ASIO.

9.52 I have concluded that option {b) is to be preferred. As I envisage it, this approach would have the effect of reducing the demands upon ASIO's resources {with some scope for staff savings by ASIO in regional offices at least) while maintaining its special contribution. ASIO would in the ordinary course be confined to assessing a person on the basis of available security records (including records, where appropriate, of overseas liaison services). ASIO would inquire further,

including conducting interviews where appropriate, when some question it considered to be relevant to its concerns arose from the records or from information provided by the individual or the employing agency.

9. 53 ASIO would no longer as a matter of course interview a person for whom a high level clearance is sought. ASIO's experience is that these interviews are generally of limited significance in terms of eliciting information bearing directly on espionage, sabotage, subversion, etc in cases where no question of security interest arises from information otherwise available. ASIO does see these interviews as providing an opportunity for a general protective security briefing, but this could be done by the employing agency or some other security checking agency.

210.

9.54 In the ordinary course, interviewing of the person and any referees would be left to the employing agency or other agency charged with carrying out the checking function. This would relieve ASIO of the burden of carrying out a large number of

interviews of a kind which rarely reveal any ma tter of security interest to ASIO. Generally ASIO's interviewing, perhaps because of its doubts about the extent to which it can inquire into personal circumstances and characteris tics, does not appear to have been particularly thorough or probing. I would rather see

it concentrate does any

arise interviewing which bears on those few cases where some

on question which it is used in the AS IO Act.

security in the sense in In those cases a measure of

overlap in interviewing may be unavoidable.

9.55 A particular advantage of option (b) to which I refer below, is that it should, in the case of most high level

clearances, obviate part of delays built into the present processes.

9.56 Generally speaking, a stronger effort needs to be put into the checking of personal circumstances and characteristics by or

on behalf of the employing agency.

9.57 The onus could be placed squarely on agencies to do this, but while this course is feasible for some agencies, it is less ∑ f and Foreign A ffairs, so for others. Departments l1ke De ence which have significant departmental

event, should be capable of upgrading

security sections in their effort if there any

is a

need for more to be done. But for other agencies that are small, or have few positions calling for security clearances, th is may

be less feasible. The carrying out of security intervie ws is a

skilled business and such an agency may find it hard to recruit

or utilize adequately an appropriate ly skilled person.

9.58 An alternative is to set up a new personnel securit y body

- it could be named the Personnel Security Bureau -to carry out

checking on behalf of other agencies. The Bureau could carry

211.

out police and other checks, including interviews, and then present the employing agency with a report, together with a security assessment obtained from ASIO, as the basis for the agency's decision on a clearance. The Bureau should not express an opinion or provide a recommendation on whether access should be granted.

9.59 The Bureau could be attached to the Public Service Board, the Attorney-General's Department or one of the service departments such as Special Minister of State. It need not be large but ideally would be attached to an agency already having representation in the States so that staff required to conduct interviews or carry out other checks could be deployed 1n an existing office.

9.60 It would be possible to allow some flexibility in approach. Departments which can demonstrate a capacity to undertake efficiently the function themselves could be allowed to do so. Other agencies-the bulk I would expect - would use j 1 the new Bureau. A variation on this approach, along lines followed in some countries, would be to institute arrangements J l by which agencies which could not readily take on the function

themselves would be able to arrange with a larger agency to undertake checking on their behalf. The report on the result of the checks would still come back to the employing agency for it to make a decision on clearance.

9.61 I recommend that action be taken to ensure effective checking by all relevant employing agencies of the personal I 1

circumstances and characteristics of candidates for clearance and that, to this end:

(a) relevant procedures and requirements should be reviewed and, as may be necessary, re-issued to agencies in clear form; and

212.

(b) departmental security capabilities should be upgraded where

necessary and/or a Personnel Security Checking Bureau should be established to carry out security checking on behalf of

agencies which cannot readily and effectively carry out their own checking.

9,62 Before leaving this aspect, I note that each of the Armed Services operates a separate system of security checking. Given the close involvement and interaction of the Services in and with the Department of Defence, a common security checking unit, within the Department organisation, would seem to make a good deal of sense. Such a unit could process all applications for

security assessment arising from that Department or the Defence Force, with likely gains in consistency of standards and in efficien cy. I suggest that consideration be given to this proposal by the Defence organisation.

9.63 It has been suggested that officers of the Bureau and of

departments would not be able to achieve the same level of

candour and disclosure afforded to ASIO officers by interviewees

who are assured that only information truly relevant to security

will be revealed to their employing or prospective employing department. ASIO referred to this consideration in justification

of its refusal to conduct a security interview jointly with a

requesting department. To take such a position is, of course, to take a pessimistic view of the ability of departments to make

the preliminary inquiries, including those into general character, recommended in Part II of the Personnel Assessment

Manu a 1.

9.64 I regard such pessimism as unwarranted. My inquiries have

established that there are departmental securit y staff who do

interview applicants for

detail. People have shown a

delicate personal matters to they have confidence in the

interviewed in a skilful

access in considerable depth and willingness to make disclosures of than ASIO officers if persons other integrity o f the interviewer, are manner and are convinced of the

213.

necessity for the interview. If staff with appropriate skill s and experience are utilized, I am confident that the Bureau or departments would carry out interviews as effectively as ASIO.

ASIO's performance in carrying out assessments 9.65 ASIO handles a high volume of security assessments as can t ~- seen from the table below. In 198 3/84 expenditure on the

security assessment function (including both checking for access to national security information and for entry to or reside nce in Australia) amounted to 4.34% of ASIO's total expenditure. A number of officers in Head Off ice and in the regional off ices are employed on this function. (In regional offices staff are often engaged on security assessment activities on a part-t ime basis) "

9.66 The

years for following

number of assessments processed all categories of access checking table:

Top Secret

1979 2, 027

1980 2,294

1981 2,502

1982 2,820

1983 2,980

To end September 1984 2,521

Secret

14,545 13,722 11,740 10,556

9,369

6,965

Confidential

19,169 16,906 14,855 12,047

7,773

6,047

by ASIO in recent

are set out in the

Total

35,741 32,9 22 29,097 25,4 23 20,122

15,533

9. 67 The table

overall number shows of

a marked fall over the period in the

Secret access checks. However, Top

assessments, which impose the greatest demands upon ASIO'sl resources, show an increase of 47.01% over the period 1979-1983 or an average annual increase of 11.75%. ASIO states that the level of demand for Top Secret clearances in Australia is in excess of that prevailing in comparable countries. The rate of

214.

increase in the number of Top Secret clearances sought over the period mentioned significantly exceeds the rate of growth in the number of full-time staff employed under the Public Service Act.

I refer below to the desirability of agencies keeping to the

absolute minimum the number of positions requiring security clearances.

9. 6 8 The number of non-favourable (qualified or adverse) assessments issued in respect of national security access during the period l July 1974 to 30 September 1984 is as follows:

YEAR QUALIFIED ADVERSE TarAL

ASSESSMENTS ASSESSMENTS

1974/75 34 10 44

1975/76 ll 8 19

1976/77 9 11 20

1977/78 21 4 25

1978/79 8 l 9

1979/80 l 1

1980/81 11 l 12

1981/82 11 3 14

1982/83 32 4 36

19 B 3/84 20 20

1.7.84/30.9.84 2 2

h sub]' ect to non-favourable 9.69 About 25% of the people w o are f 1 to the Securit y assessments exercise their right o appea T ∑ b nal in access cases Appeals Tribunal. The findings of the rl. u b 1984 were as follows: over the period 1 July 1979 to 30 Septem er

215.

YEAR

1979/80 1980/81 1981/82 1982/83 1983/84 1.7.84/30.9/84

TorAL

APPEALS TO

SAT

6

3

9

18

UPHELD DISMISSED

1 5

3

6 3

10 8

9. 70 The Security Appeals Tribunal has upheld a significant number of appeals. This has no doubt reinforced in relevant ASIO officers the need for particular care in the assessment task.

9.71 A number of agencies have complained to me about delays in obtaining security assessments. I have concentrated my consideration of this clearance as it is in arise. Assessments for most time given ASIO's

question on assessments for Top Secret that area that the majority of complaints I Top Secret almost invariably require the policy of interviewing all applicants for j

clearance at that level.

9.72 Delays

clearances are elapsed during

in the recruitment process while security obtained, coming on top of whatever time has the selection process, are an understandable cause of concern. It is not only the delay agencies suffer in filling positions which may be vacant, there is also the risk, where they are competing for employees with highly sought after skills, that they will lose a prospective employee to someone else who is ablE{ to make a firm offer. Some delay will ~e ~~

unavoidable where a security clearance is necessary, but it J.S important that the delay not be undue. 1

216. /

9. 73 ASIO informed me that routine Top Secret assessments are

usually processed and the result notified to the agency in six

weeks. Agencies have quoted an average of about that period. In

some cases the processing of an assessment takes muc h longer,

running into a period of months. (By way of comparison, ASIO has

state d that straightforward cases at the Con fidential/Secret

levels, where no interview or overseas check is required, are usually processed within ten working days).

9.74 Ultimately a judgment about the reasonableness of a period of that order can only be made in the individual case as the

circumstances, including such matters as the avail abil ity of the subject for interview, differ. In particular, where by reason of

the subject's background or travel it is desirable to carry out

checks with foreign liaison services, the time

out of ASIO's control. ASIO has stated that

involved may be checks of some

liaison services can take longer than it would wish.

9. 75 Figures supplied by ASIO indicate that, overseas checks

aside, the interview of the subject, and its arrangement and reporting, accounts for the bulk of the time taken in processing

an assessment. A study carried out within ASIO earli er this year

of a random sample of security assessments for Top Secret access

showed the following results:

Average time taken from

assessment:

Accounted for as follows:

Records/registry Security assessment area Interview stag∑e

arrival

Total

at AS IO to

47 days

7 days

5 days

35 days

47 days

Th e interview

taken by ASIO

stage accounted on average in processing requests for for 7 4% of

assessment.

217.

signing

the

The

time ti me

taken at the interview stage is compounded by the fact that, before seeking an assessment from ASIO, the employing agency is required to make its own inquiries which, if carried out properly, could be expected to include an interview.

9.76 Under the arrangements I have proposed (9.48 to 9.55), ASIO will only undertake interviews in a small number of cases.

It will of course be important to ensure that agencies or the body carrying out checking on their behalf have sufficient resources to undertake interviews in a timely fashion. There will be scope for reducing delays by changing the present process, whereby an ASIO assessment is only requested when departmental checking is complete, to a concurrent one under which an assessment may be requested from ASIO at the outset of the cle:.arance process. I propose that the clearance process be modified in this way.

9. 77 Another factor contributing to delay in some cases is, under present arrangements, the manner in which the

decision-making process works within the relevant ASIO branch. This process appears to militate against a speedy resolution of difficult or contentious matters, or other cases where some 1 particular judgment is required. The process of discussion and debate, involving exchange of submissions and recommendations and requests for further comments appears to be unduly prolonged before a decision is made.

9.78 Difficult or contentious matters can become locked into a circular pattern, running for as long as three or four months, of submission, reconsideration, further submission, further reconsideration and so on without any new evidence or material 1 being introduced into the process.

9.79 I refer to the process of decision-making not in criticism of the officers concerned, who are trying to make the correct decision, but to draw attention to a system which appears to be unduly prolonged. Whilst one would not wish for hasty and

218.

ill-considered decisions, there comes a time when a decision can and should be made out of fairness to both the individual and

the employing agency. My inquiries have led me to the view that

that point is sometimes passed.

9.80 I recommend that, regardless of any changes in ASIO's role

in the security checking system, the Organization should review

its managerial and decision-making processes in this area with a

' view to simplifying and streamlining them.

Extent of checking

9.81 The extent of checking undertaken by departments and agencies varies greatly. At one extreme, some departments simply examine birth certificates and other documentary evidence, for example academic qualifications, and make no further inquiries

unless the documents raise some query. On the other hand there

are departments which interview and brief the subject at length and explore all the areas suggested in Part II of the Personnel Assessment Manual. Other departments appear to fall somew here between these levels of inquiry.

9.82 The ASIO contribution to the checking process is to interview all applicants for access to Top Secret as a ma tter of

course, and applicants for Secret and Confidential where the circumstances justify such action. In addition the applications for assessment are checked against the intel ligence holdings of the Organization and, where appropriate, those of overseas

liaison services. Any indications of possible security interest brought to light in the course of that checking are then either confirmed or otherwise resolved prior to the Organizati on making

its assessment.

9.83 I have already referred to unsatisfacto ry aspects of their

present arrangements by which departments carry

security checking responsibilities.

219.

out

9. 84 My inquiries in other countries confirmed my view that more should be done in Australia in the area of vetting.

Clearance procedures for Top Secret access 1n other countries involve, as a matter of course, interviews with referees and/or other persons having a knowledge of the subject. In addition, in the USA at least, much more extensive records checks, including credit checks, are undertaken. (Information from public sources about checking practices in some other countries is set out at Appendix I).

9.85 I see a need for a strengthening of our security checking system. In particular, I am of the opinion that the process of vetting for access to Top Secret material should approximate more closely to the more comprehensive and probing vetting process that is already undertaken for access to certain categories of specially designated information (the Top Secret

(Absolute) clearance) "

9.86 It

security. personal attitudes, detecting could lead

is doubtful that any system can guarantee personnel However, the more thorough the investigation of the circumstances and characteristics, the beliefs and of an individual, the greater is the chance of

untrustworthiness, unreliability or disloyalty which to a breach of security.

9.87 Security checking is not performed in a vacuum, and must take account of the social and political environment and resource constraints. Some investigatory techniques and processes are not acceptable in Australian society today, and

the more costly and intrusive processes which are acceptable should be confined to those cases where the need is greatest, namely, where there is regular access to highly sensitive information.

9. 88 It is my view that clearances up to and including Secret should continue to be based on a process of 'negative vetting'. By negative vetting I mean a security checking process which

220.

operates on the assumption that the subject is fit to be granted access unless there is information available that indicates that he or she is not suitable. Negative vetting is characterized by

a search of official records, such as those of the poli ce and

the security service, for adverse information and the granti ng of a clearance in the absence of such information.

9.89 In the case of Top Secret clearances I consider that it is necessary to do more than establish the absence of adverse information. Top Secret information is defined, in the Protective Security Manual, as national security information the

unauthorised disclosure of which could cause exceptionally grave dama ge to the national security. It is plain that information of

that kind requires the greatest practicable protection and that individuals who have access to it must be properly vette d.

9.90 In RCIS (4:1-289), I concluded that 'whilst ASIO's present assessments may be good enough for routine securit y, they are not good enough for the checking of officers with regular access to top secret material'. I noted the need for ASIO to seek

sources of information as to the character of the subject and his or her financial circumstances. I discussed the need for

in-depth investigations ('field investigations') of a person's background, character and circumstances. I recommended (4:1-802):

That, for checks for access to the higher grades

classified material ASIO should instit ute a system , . . of

of

positive vetting going beyond present invest1gat1ons.

∑ ∑ f ∑ tl since RCIS 9.91 Although procedures have changed s1gn1 1can Y ' I do not regard as satisfactory the level of security checking

that has been achieved for Top Secret access. It is my view that individuals with regular access to Top Secret information should By Positive vetting I mean a 'positive vetting'. undergo security Wh 1'ch seeks, through inquiries checking process

with both official and non-officia l sources, to conducted establish positively the reliability and loyalty of the subject .

2 21.

9.92 In order to ensure a consistent and reasonable standard of checking I recommend that the Personnel Assessment Manual be re-written to specify the minimum extent of checking for each level of clearance. It must be made clear that the checking processes apply to all persons needing access to national security information or areas, whether or not they are employed under the Public Service Act.

9.93 Whilst I do not propose to specify detailed minimum requirements for security checking I offer some pointers. In the case of checks for Entry, Confidential and Secret I see the checking process as including the following:

(a} confirmation of the person's identity and personal particulars through the sighting and examination of original identity documents (e.g. full birth certificate, marriage certificate, passport}

(b) confirmation of address(es) through reference to telephone directories and electoral rolls

(c) a police records check

(d) an interview (and further investigation) where this is necessary to expand on or resolve problem areas

(e) an ASIO records check and, where there is

indication of pass ible security significance, investigation by ASIO as it considers necessary.

a positive

such further

These vetting actions should be regarded as the minimum acceptable. Agencies having a capacity to do so should be able to do more, such as interviewing the subject as a matter of course for Secret clearances.

9.94 In addition to a range of identity and records checks --------------------------=---------------~------------------------

(including at least those outlined in 9.93}, positive vetting

222.

should encompass an in-depth interview of the subject. It is _a_l_s_o ___ n_e __ c_e_s_s~a~r~y ___ t~o~~a~s~k~~f~o~r~,--~a~n~d--~s~p~e~a~k~~t~o~,~~r~e~f~e~r~e~e~s. It is

necessary to interview persons individual undergoing vetting in independent of that provided by

with a good knowledge of the

order to obtain information , the subject, on the subject " s

background, circumstances and character. Nominated referees represent one source of such information; in addition, howe ver, they provide a means of identifying other such sources. I note

that the United Kingdom Security Commission recommended, in its report of May 1983 concerning the Prime case (HMSO Command 8876) :

(Positive vetting) field investigations in relati on to applicants for employment in the intelligence and security agencies who will, if accepted, have access to information of the highest classification should, whenever possible,

include interviews with independent persons, other than the referees named by the applicant.

9,95 In RCIS, I stated:

One of the most relevant matters to be checked is the

financial position of the subject, for that is regarded as one of the most likely weaknesses of a person to be

exploited by an intelligence agent. (4:1-290(e))

I remain convinced of the need for inquiries to be conducted

into the financial circumstances of individuals security checking for high level access. Inquiri es may be pursued by having the subject complete a

financial consent of

questionnaire, undertaking checks (with the written the subject) with credit reference services' banks and other

bodies, consulting bankruptcy records, and focussin on

financial matters during interviews of the subject and his or

her associates. The object of such inquiries would be threefo ld :

(a) to assess the probity of the individual; for instance , a that he cannot honour,

per son who regularly writes cheques or who frequently defaults on commitments, involved in illegal or disrep utable enterprises,

o r who is

or who is

22 3.

not prepared to explain the source of significant income, may not be the type of person who can be entrusted with the

nation's most vital secrets;

(b) to discover any significant vulnerability, whether arising from financial incompetence, force of circumstances, or involvement in illegal or disreputable financial activities; and

(c) to obtain a better understanding of the individual; a person's expenditure tends to reflect his or her values and interests and may contribute to a more complete

understanding of the person's character by the assessing authorities.

Periodic review of security clearances 9.96 Security vetting involves an assessment of a person's circumstances, beliefs and values at a point in time. However, these may change. It is, therefore, as important to carry out

re-checking as it is to carry out the initial check. The US Defense Investigative Service has stated in an information pamphlet that:

" " " in almost all instances in which cleared people " " " have been found guilty of espionage, it is subsequently determined that they were not involved with foreign intelligence at the time they were initially investigated and cleared. Rather, their involvement in espionage developed after the initial investigation and clearance and after they were established in a position of trust.

9.97 Reviews of security clearances are covered in Part III of the Security Assessment Manual, where it is stated that:

A Commonwealth agency is to review as soon as practicable, and thereafter at intervals not greater than five years, security clearances authorising access to national security information classified SECRET or TOP SECRET.

The Manual goes on to list the circumstances under which a review of a security assessment should be requested from ASIO.

224.

How ever, neither the Security Assessment Manual nor the Personnel Assessment Manual gives any detailed guidance on how

reviews are to be conducted. This is a significant om ission. My inquiries have revealed that reviews are not performed at all by

some Departments, while those that do carry out re-checking

often do not pursue the task as thoroughly, and with the degree of vigour, as

procedures for

is required. I recommend that detailed, minimum reviews be specified, and that they include the foll owing :

(a) For Entry/Confidential/Secret

completion and examination of appropriate clearance forms a police check

a questionnaire to the subject's supervisor seeking

comments as to his/her continued suitability for access.

(b) For Top Secret

the checks described above a check of credit references

an overseas check where appropriate an in-depth interview of the subject.

Security checking of members of intelligence agencies 9.98 Members of the intell igence and securi ty agencies ma y have eat deal of obtain access' to a gr access, or the ability to sensitive national security information. The comp romise of such

indeed turn it an agency can effectively neutralize it and into doubt an instrument harmful to Australian interests. I have no d f staff of those that special vetting procedures are war rante o r h h ∑ gh standards of agencies. Some of the agencies already ave 1 d s and wor ks to vetting but each of them follows its ow n proce ure its own standards. 9.99 ' 1 can see benefits, £aising the standards of f Sharing of expertise and in terms o . 1∑n the intelligence agenc leS some, 225.

consulting together to establish minimum vetting procedures and more stringent vetting procedures than those applied to ToE Secret access, for their staffs (or at least those members of their staffs who have wide access or the ability to obtain such access). I consider that there would be advantage in the Defence Department's Office of Special Clearances and Records (OSCAR) participating in such consultations. It might be appropriate, in

terms of building on existing expertise and taking advantage of economies of scale, for OSCAR to implement the new level of vetting inquiries on behalf of JIO and DSD. Rather than

expanding its own vetting capacity, ONA could consider seeking an arrangement for its vetting inquires to be carried out by OSCAR also.

9.100 In this context consideration might be given to replacing the Top Secret (Absolute) clearance with a new clearance titled Special Access.

Application of vetting 9.101 I wish to emphasise that the security checking process must be directed to the assessment of each person as an

individual; the significance of membership of particular bodies or of particular personal circumstances or characteristics must be evaluated on a case by case basis. The process should not become one of ticking boxes or adding up crosses.

9.102 The procedures I have in mind for positive vetting are intrusive and, understandably, may be resented. Some individuals may argue that on grounds of rank or length of service they

should be exempted from the checking processes. This should not be accepted. It is unfortunate but true that seniority and length of serv1ce are no bar to disloyalty or lack of

reliability. In any case the privacy of a junior clerical assistant is as important as the privacy of a senior officer. It is important for reasons of fairness and effectiveness that the process of checking is applied to all without fear or favour.

226.

9.103 However, in recognition of the very intrusive nature of the vetting proposed, and taking into account the cost in terms of staff and money of a positive vetting system, I recommend further review by departments and other agencies of the number of designated security assessment positions involving Top Secret access, with a view to reducing as far as practicable the positions for which Top Secret clearance will be required.

9.104 In the same context, I draw attention to the importance of clear and firm rules for the classification of documents on national security grounds, and to a regular and formalized process for down-grading of classifications. Such rules and

procedures, as well as reinforcing the system, facilitate a reduction in the number of positions calling for Top Secret access. I recommend that consideration be given to a further review of the national security classification procedures. The United States procedures, set out in Executive Order No. 12356 dated 1 April 1982 on National Security Information, provide a

useful mode 1.

227.

CHAPTER 10

SECURITY CHECKING FOR ENTRY TO AUSTRALIA

Non-access checking procedures 10.1 ASIO has for many years played an important role in the arrangements for the security checking of certain foreigners in relation to the making of decisions under provisions of the Migration Act 1958. S6curity checking of this kind is referred

to as 'non-access checking' to distinguish it from the security checking, discussed in Chapter 9, of public servants and other persons requiring access to national security information or areas.

10.2 ASIO assists the Department of Immigration and Ethnic Affairs in the carrying out of checks and in providing security assessments on individuals by way of advice to that Department in relation to decisions of the following kinds:

(a) issue of visas to applicants for entry to Australia; (b) grant to short-term visitors of a change to permanent resident status; (c) deportation in relation to which the Department of

Immigration and Ethnic Affairs may on occasion seek security advice from ASIO.

Its assessments in these cases, other than deportation of a permanent resident, are excluded from the review provisions of Part IV of the ASIO Act.

10.3 Other 'non-access' areas 1n which ASIO may be required to provide security assessments on individuals are:

(a) passport applications - ASIO may be required on occasion to provide a security assessment to assist the Minister for

228.

Foreign Affairs in withhold the issue Passports Act 1938:

the exercise of his discretio n of a passport under s.7E(l ) of to

the

(b) grant of citizenship under the Australian Citizensh ip Act

1948. New arrangements introduced within the last year have greatly reduced ASIO's involvement in these cases; an application for citizenship will only be referred to ASIO by the Department of Immigration and Ethnic Affairs if there is

something to suggest such action would be appropriate. (ASIO' s view is that the grant of citizenship to a per son

who already has permanent resident status does not

significantly affect any risk to security by that person. The processing of citizenship applications before the recent change was said to be a 'rubber-stamp' exercise. In 1981/82, ASIO processed 80,300 applicants for citizenship and issued

two adverse, and two qualified, assessments).

10.4 The security procedures for immigration are laid down in a

handbook of security checking procedures for entry into

Au stralia compiled by ASIO in consultation with the Department

of Immigration and Ethnic Affairs (DIEA) and the Department of

Foreign Affairs.

10 .5 The procedures call for security checking of some but not

all foreigners entering Australia, and for the checking of such per sons after

(e.g. where a short-term visitor, who

in stated circumstances their entry to Australia has not been checked

before, seeks to extend his stay). Applications for entry are

generally made at Australian posts overseas. The procedures

Prescribe the respective roles of over seas posts and ASIO Head

Office in processing security checks. Cases which meet stated

criteria are referred to ASIO Head Office at the outset and are handled from there. In any case where a checking office decides

to recommend against allowing entry of a person to Australia , that recommendation is referred to ASIO Head Office for decision

there on any recommendation to be made to DIEA.

229.

10.6 Since the early 1950's, ASIO has had liaison officers at Australian posts in a number of countries. Security checking is handled at those posts by the ASIO officers, and at other posts by Immigration and Ethnic Affairs, or Foreign Affairs, officers. An ASIO liaison officer at a post may visit other posts and

provide assistance to immigration staff there.

10.7 The Department of Immigration and Ethnic Affairs carries

out its own separate screening of prospective immigrants and long-term visitors including police records checks as part of character checking {at some posts, where police and security checks are made with the one agency, an ASIO officer may handle the police checks as well).

10.8 The process of security checking includes records checks through overseas liaison services for indications of security interest and, in specified cases, a personal interview.

10.9 The policy of screening entrants to Australia with a view to keeping out people who might constitute a risk to security is understandable and appropriate, but there are practical limits to the effectiveness of the screening process which need to be kept in mind.

10.10 During the

immigration program, officers in Europe, value in checking

early years of Aqstralia's post-war Australia was able, through ASIO liaison 1 to gain access to records of considerable the political background of people from European countries. The object of the process was to identify and when necessary screen out from potential m igrants former Nazis and fascists and, later, communists, especially those who could be regarded as activists.

10.11 Access cannot generally be had now to information of the same value in respect of people from Europe (or from man y other parts of the world). Inquiries of liaison security service s can be and are valuable in some countries but are, I understand, of

230.

limited use in other countries. The Department of Immigration and Ethnic Affairs noted 1n a submission that in certain

countries checks with the local authorities are not possible.

10.12 Beyond records checks through liaison services, and

checks of any relevant records at a post and of ASIO' s own

records where appropriate, the checking process relies on a

personal interview with the applicant which is carried out in

some but not all cases. The questionnaire set out in the

security checking handbook fs designed to elicit personal , particulars and to build up a 'picture of the applicant's family,

education, employment, and political and travel background. It includes questions under 'political history' wh ich may produce useful information but would not appear likely to uncover, for example, a member of a terrorist group.

10.13 The security checking procedures are presumably directed to keeping out of Australia, or to prevent the long-term settling in Australia, of foreigners who are judged to be a threat to security. In assessing the threat that may be posed by an individual, ASIO is guided by the definition of security in

s.4 of the ASIO Act, that is, the protection of Australia and its people from espionage, sabotage, subversion, active measures

of foreign intervention or terrorism.

10.14 Within that framework there is little formal guidance. No regulations have been made under s.37(3) prescribing matters that are to be taken into account. In relation to citizenship applications there is a determination by the Director -General

largely redundant pursuant to s.37(4) but this is now result of new arrangements referred to above (10(3)(b)).

as a

10 .15 ASIO has also had regard,

draft determinations prepared with

pending formal adoption of a view to adoption by the

d b the Secretaries Director-General, to criteria propose Y . . C ∑ ∑ ∑ t ∑ n 1977 for imm 1grat1on ommtttee on Intell1gence and Secur1 Y 1 cases. Those criteria were directed to the screening out of:

231.

(a) persons reasonably suspect as to their likely involvement im l acts of espionage, sabotage or subversion should they enter∑ ∑ Australia;

(b) extremists of either the right or the left of the politica L spectrum who have a propensity towards politically motivatedh violence;

(c) terrorists and urban guerillas.

Those criteria generally conform to the concept of security asi: defined in the ASIO Act although the references to subversio ru would require careful elaboration if they were to be adopted. T he document prepared in 1977 states that membership of anyr

ideological or political party will not of itself debar a persom 1 from entry to Australia unless he or she is judged likely tm :: play an actual subversive role in Australia.

10.16 ASIO has not yet acted to determine formally the criteri ru to be applied in immigration cases, whether along the line ffi proposed by the Secretaries Committee in 1977 or otherwise. r: feel bound to comment that, in an area where guidance would see ~ to be important, it is hard to understand why that initiativ e! begun in 1977 has not been brought to fruition.

10.17 There is a danger, in the absence of clear guidance as t ~ its purpose, that a security checking procedure such as that: applied to people wanting to enter Australia can becom e ~

ineffectual. I see a clear need for delineation of the object o t= the process by reference to, but in more specific terms than, the ASIO Act's definition of security. There should be a statement of the kind of people whom it is desired to keep out. of Australia.

10.18 I understand that the existing security checking∑ procedures for entry into Australia are being reviewed by ASI 01 and the Department of Immigration and Ethnic Affairs with a vie ~

2 32.

to the issue

objectives of

articulated 1n

of a revised handbook. I suggest that the

the screening process should be clearly the handbook for the guidance of imm igration and other officers who are involved in the process, as well as AS IO officers .

10.19 I recommend that action be taken as a matter of priority:

(a) to determine formally, either by regulation under s.37(3) of

the ASIO Act, or by a determination of the Director -General

under s .37(4), the appropriate criteria to be appli ed by

ASIO in assessing whether a foreign person seeking to enter

or stay in Australia constitutes a security ris k;

(b) by relevant

settle the procedures

departments and revision of the for entry into

agencies, handbook Australia

includi ng of securit y with the

ASIO , to

checking aim of

providing clear guidance to officers involved in carrying out the procedures on the objectives of the exercise as well as the processes to be followed.

AS IO 's part in the checking system

10.20 As far as ASIO's role in the checking system is

concerned, its liaison with foreign security services provides

access to what would appear to be the most valuable source of relevant information, albeit that the value of that access

varies between the various services and countries. There is an important and continuing role for ASIO in establishing and tending to appropriate liaison arrange ments.

10.21 At present, checks are made of foreig n liaison services

by the ASIO liaison officer in the relevant country, if there is

h h Or by Imml

∑gra ti on and E thnic sue an officer posted t ere, Affairs or Foreign Affairs officer s in accordance with

procedures agreed between ASIO and the liais on service. In countries where ASIO is not represented, an ASIO liaison officer

233.

from another post may visit from time to time to maintain contact with the liaison service.

10.22 ASIO also has an important role at Head Office, and one that should continue, in carrying out further checks and producing assessments in those cases that are referred directly to it by posts or are referred because of possible adverse factors.

10.23 Tables of statistics for recent years are set out at Appendix J in relation to:

(a) immigration checking by ASIO liaison officers on overseas posting; (b) immigration check requests processed by ASIO Head Office;

(c) interviews conducted by ASIO Regional Offices in relation to applications for resident status and extensions of stay;

(d) qualified or adverse assessments in relation to grant of change of residence status;

(e) findings of the Security Appeals Tribunal in passport and citizenship cases.

It will be seen from those figures that, of the relatively large number of cases processed by ASIO liaison officers, or by ASIO Head Office, a few only result in a recommendation against entry. That in itself is not surprising, and numbers alone cannot determine the value to the nation of decisions taken to refuse entry to individuals on security grounds.

10. 24 A question does arise about the importance of personal interviews, where required, being carried out at posts by ASIO officers as distinct from Immigration and Ethnic Affairs or other officers.

234.

10.25 ASIO has submitted to me that, by reason of their

training as intelligence officers, its liaison officers are better able than other officers to conduct security interviews. Th is may be so, but the example given in the submission was not

persuasive (it pointed rather to the need for clearer guidance to interviewing officers in the relevant handbook). Some ASIO officers are no doubt highly skilled in conducting personal

interviews, but from inquiries made within ASIO I understand that difficulties have arisen in recent years with some liaiso n officers and that the standard and speed of checking has suffered.

10.26 Officers within ASIO have stated that liaison officers are inclined to accord less importance to security checking than to their liaison with local security services. This may be in part a reflection of an inadequate understanding of the

importance of their security checking role and the processe s involved resulting from the limited training in security checking able to be given prior to departure on posting. Liaison officers are often recruited from intelligence branches and generally have no attachments during Office.

10.27 DIEA said in

be imperative that

ASIO officers.

background in training to security checking except for the relevant branch in Head

a submission to me that it appeared not to

security checking overseas be conducted by

10.28 f h th ∑ s 11∑ kely to be a ma rked I doubt mysel t at ere 1 interviews conducted by officers, provided that

difference in the results of security migration officers, compared with ASIO as to the purpose of the interview they are given clear guidance and can have resort to ASIO for advice or assistance in unusual

cases. I have already recommended acti on to revise the handbook of security checking procedures for entry into Australia with the aim of providing clearer guidance to interviewing offic ers. DIEA officers should be reasonably skilled at conducting

235.

personal interviews given their role in the general screening of potential migrants.

10.29 I believe that the need for ASIO officers to be poste overseas for security checking purposes should be reviewed.

236.

CHAPTER ll

REVIEW OF SECURITY ASSESSMENTS

The review system

ll.l The ASIO Act, which carne into force in 1980, laid down in Part IV a comprehensive scheme regulating the provision by ASIO of 'security assessments " relating to individuals and enabling those assessments to be reviewed by an independent body in many

cases. This represented a marked advance in terms of protection of the rights of people affected by such assessments. The review procedure has also had the effect of focussing ASIO's attention on its role in this area and of encouraging greater rigour in

its approach.

11.2 Security assessments are, in essence, defined as advice in writing on whether certain action should or should not be taken in relation to a person either by way of classified information or controlled areas

granting or by

access to exercising

certain discretions under the Migration Act 1958 , Australian Citizenship Act 1948 or Passports Act 1938 (s.35) "

11.3 The general position is that where a security assessment or accompanying information is or may be prejudicial to the interests of the individual he or she is to be notified of it and is entitled to apply to the Security Appeals Tribunal (SAT)

for a review of the assessment (ss. 38 (1) , 54) . Statistics in relation to applications for review are at Append ix K.

11.4 The notification and revie w provisions do not apply in respect of the security assessment of persons who are not citizens or permanent residents in connectio n with migration t Outside Australia (s.36). decisions or with their employmen There is power in the Attorney-General to certify in a

particular case that on security grounds a person should not be

237.

notified of an assessment or that particular grounds of the assessment ought not to be disclosed (s. 38 ( 2)). No such certificate has been given to date.

11.5 The SAT is constituted for particular proceedings by the President or another presidential member (required to be a judge or a former judge) and two other members (s.51).

11.6 The parties to a review are the Director-General of Security and the applicant. The employing agency is entitled to give evidence or make submissions. ASIO is obliged to present to the SAT all relevant information available to it. The proceedings are in private. The applicant is not allowed to be present when the Tribunal is hearing submissions or evidence from ASIO or the employing agency, and ASIO and the employing agency are not allowed to be present when the Tribunal is hearing from the applicant (s.SS).

11.7 The Tribunal is required, after hearing from ASIO and the employing authority, to consider whether further particulars that can consistently with the requirements of security be given to the applicant should, in the interests of just ice, be so given. The Tribunal has also to consider whether either party should be given an opportunity to be heard again by reason of matters raised by the other party (s.58). There is provision enabling the Attorney-General to certify that disclosure of certain information would be contrary to the public interest for security or other reasons and, while the Tribunal may have access to such information, it may not (subject to a discretion

in certain cases) disclose that information to a party (s.59).

11.8 The Tribunal's findings are given to the parties and the employing agency subject to a discretion to direct that particular parts not be disclosed to the applicant or the employing agency. The applicant is generally entitled to publish the findings of the Tribunal (s.60).

238.

ll. 9 The employing agency, and any body reviewing its action, is required to treat the Tribunal's findings as superseding ASIO's assessment to the extent that they do not confirm it. In certain circumstances, where the employing agency's action is

subject to variation on review, the Tribunal's findings, so far as they do not confirm the assessment, are binding on the employing agency and on the review body (s.61). Subject to constitutional limitations, the findings of the Tribunal are not

subject to review by any court or other tribunal (s.62).

11.10 A fundamental element of the legislative scheme is that any information or advice given by ASIO in relation to its assessment of an individual for clearance purposes is treated as a security assessment. If that assessment contains anything that

is or could be prejudicial to the interests of the individua l (an 'adverse' or 'qualified' assessment), the individual must be

provided with a copy of it (ss.35-39).

ll.ll An assessment is ordinarily furnished to the emp loying agency in one of the following forms:

(a) It is not desired to recommend against the grant o f security

clearance for access as proposed (a favourable assessment) i

(b) It is not recommended that the applicant be denied access proposed. However, the information containe d in the

the

attached statement of grounds may assist the Depart ment to decide whether he should have that access (a qualified assessment} ;

(c) It is recommended that the applicant should not be granted

b to do

so would not be consistent the access proposed ecause with the requirements of securit y (an adverse assessment)∑ 'ded with an adverse (A statement of grounds has to be provl assessment and forms part of that assessment (s.37( 2)) ∑

239.

11.12 The purpose and effect of the assessment provisions is to formalize and regulate the flow of information from ASIO to the employing agency relating to the person subject to assessment. They preclude informal or 'backdoor' passage of personal

information to the agency.

11.13 The Attorney-General is able, under s.65(1), to require the SAT to inquire and report to him on any alleged action of ASIO in by-passing the assessment and notification provisions.

No such matter has been referred to the SAT to date.

11.14 Section 65 (1) also enables the Attorney-General to refer to the SAT for inquiry and report a security assessment

furnished by ASIO before the commencement of the Act. (The review provisions are ordinarily limited in their application to assessments furnished after that date) " No such matter has been referred.

Communication by ASIO of supplementary information 11.15 The formalising of the assessment process has given rise to complaints from departments and other agencies that they are no longer able to discuss with ASIO individual cases and may be

unaware, for example, of matters to which ASIO had regard in preparing an assessment and of the significance of those matters. It is claimed that ASIO's ability to bring to notice matters that may be relevent to the decision on clearance has

been reduced.

11.16 The prohibition of informal communication by ASIO of information additional to that provided in a security assessment is a necessary and desirable element of the scheme for review. There is a case though for ASIO having some flexibility in

regard to the information that it can communicate as part of an assessment.

11.17 A qualified assessment does provide ASIO with an avenue for passing on to an employing agency, as part of the

240.

assessment, comments or information that may be relevant to the agency's decision on clearance but which have not led AS IO to recommend against clearance. The SAT has construed the

legislaticn, however, 1'n a way h' h 1∑ 't w 1c 1m1 s to some extent the scope for use by ASIO of qualified assessments.

11.18 In the SAT's view, information to be conveyed by

qualifi.ed assessment must be both relevant to security and of sufficient cogency as to justify a reasonable agency head taking a negative view on clearance.

11.19 If the legislation has this effect it is in my view unduly restrictive and does not sit well with the overall scheme for security clearance.

11.20 ASIO's security assessment is not the only source of information for the agency head's decision on cleara nce. The agency head should consider also other information elicited by his agency relevant to an individual's suitability for clearance.

11.21 I am aware that existing administrative arrangements require the employing ASIO, to furnish any

have a bearing on the

employing agency has

agency, when seeking an assessment from information held by subject's security already formed an

the agency which may standing. (Where the adverse view on the

subject's suitability for clearance it could deny without proceeding to seek an assessment from ASIO) ∑

clearance

11.22 ld 1 Pass O

n by way of a

A view that ASIO shou on Y

qualified assessment information that it considers is capable in ∑ ∑ by the agency head

itself of sustaining a negative dec1s1on amounts to confining the agency head's considerat ion to matters

1 Of Secur1

. ty considers would justify

that the Dil'ector -Genera denial of a clearance.

11.23 If that view is taken, I also see force in the proposal, that consideration should be raised in a submission by the SAT' 241.

given to the abolition of the qualified assessment. If the agency head's decision is to be limited by the

Director-General's advice, then it is reasonable to require the Director-General to furnish firm advice, one way or the other.

11.24 The difficulty with this

Director-General's recommendation is 'security' as defined in the AS IO Act. not in themselves justify an adverse still bear on the wider question of

view is that the

limited by reference to Considerations that may assessment by ASIO may suitability for security

clearance (e.g. the fact that a person lacks adequate discipline in relation to the handling and control of classified information) "

11.25 The risk

acquainted with together with the

is that the information, information

employing agency will not be acquired by ASIO, which may,

known to the employing agency,

bear for example on the subject's reliability and be relevant to the clearance decision notwithstanding that it does not justify an adverse assessment by ASIO by reference to risk of espionage etc.

11.26 As matters stand, that information could not be passed on to the agency by qualified assessment notwithstanding that its accuracy and relevance could be tested by the subject before the SAT. (The employing agency, on the other hand, is supposed to

pass on to ASIO any information it may hold that may bear on ASIO's consideration of the subject's security standing). I am not suggesting that ASIO should be able to pass on information that has no possible relevance to security as defined in its Act. But information that has some, even if limited, relevance

to security in that sense may have greater significance in the wider consideration that is required of the agency head. Even where it does not lead to denial of a clearance, it may enable the employing agency to take preventive security measures such as counselling of the individual.

242.

information ll. 27 not of

Examples have been quoted where ASIO has had itself conclusive but which, when considered information available to an employing agency, with other

might have led

that agency to reach

preventive measures. a different conclusio n or to take

11.28 Given the present bifurcation of responsibility for

security checking between an employing agency and ASIO, and more so if changes recommended in Chapter 9 are made, I am of the

view that ASIO's power to provide information by way of

qualified assessment is important. It is open to the person who

is the subject of such an assessment to have the accuracy and relevance of the information tested before the SA T .

11.29 I recommend that the ASIO Act be amended to make it clear that ASIO can provide to an employing agency information that relates to the person subject to clearance and could be relevant to security as defined in the Act (whether or not the

information would justify denial of clearance by reference to that definition of security).

Effect of SAT findings 11.30 Security assessments furnished by ASIO are advisory and recommendatory only. Section 61(1) provides, in broad terms, that the findings of the SAT supersede the assessment to the extent that they do not confirm it. Thus ordinarily SAT findings are also advisory and recommendatory. This is consistent with

the position that responsibility for the decision on clearance rests with the agency head.

11.31 The position is different where the class of decisions make in respect of that an agency is authorised or required to prescribed administrative actio n is subject to appeal or review (otherwise than under the Admin istrative Decisions

(Judicial

d Or varied. In that Review) Act 1977) and may be reverse situation s.61(2) operates to make the SAT findings (whether or

not they confirm the assessment) binding upon both the appeal or

24 3.

review body and upon the agency. Action affecting the occupancy of any position under the Commonwealth, where the occupant has

or may have access to classified information, is included within the definition of 'prescribed administrative action', and wo uld inc lude the withholding of a security clearance necessary for carrying out the duties of a person occupying the position. It

does not follow that any appeal lies from such a withholding.

11.32 Section 61(2) is clearly designed to avoid rehearing by another body of the issues determined by the SAT under s.60. As such, it is consistent with s.62 which specifically excludes review of SAT findings by 'any court or other tribunal'.

11.33 The provision appears to be based on a recommendation in RCIS that was made on an understanding that departmenta l

decisions on the granting of clearances could be subject to

review, and possible overturning, on appeals under the Public Service Act 1922 to a Promotions Appeals Committee against a public service promotion. I understand that the view taken by the Publi c Service Board and relevant departments whe n considering the RCIS recommendation, and still taken by the Publi c Service Board, is that the security clearance process is

separate from the promotional process, and that on an appeal against promotion the merits of a security clearance would not

be an issue. Apparently that is the way the systems work 1n

practice. A discussion of the problems and confusion in respect

of these and related matters is to be found in Appendix L.

11.34 The acceptance

could not be

of the proposition that security

clearances overturned on review by a Promotions

Appeals Committee or other review body removes the basis, as I

saw it in RC IS, for a provision such as s. 61 (2). In addition,

s.61(2) produces results which I regard as anomalous. Whe re a security clearance is required in connection with an employment

decision that is subject to reversal upon review, any findings

of the SAT on ASIO' s security assessment will be binding upon

244.

the agency head, while if the employment decision is subject to reversal, SAT's findings will remain advisory. not so

ll. 35 Thus for a person seeking appointment to the Public Service, who dces not have a right to have the decision of the reviewed, SAT findings remain prospective employing agency advisory. On the other hand,

promotion (perhaps to the same for a public servant seeking position sought by the outsider)

the SAT findings, in so far as the promotion is subject to appeal, become binding upon both the employing agency and any Promotions Appeal Committee reviewing the choice of promotee.

ll. 36 There has against promotions provisions of the

until now been a general right of appeal within the Australian Public Service but Public Service Reform Act 1984 remove within

that the right of appeal in respect or

'Senior Executive Service " or of promotions to other promotions where they are

made upon the recommendation of a " Joint Selection Committee ".

The effect of SAT findings will vary depending upon either the

level of the position in question or the method of selection.

11.37 Also, if ASIO gives a favourable assess ment (thereby

providing no occasion for an appeal to the SAT) , the agency head is free to make an unreviewable decision rejecting ASIO advice.

ll. 38 More importantly, shortcircuits

the

decision-making process. The s.61(2) security checking system

contemplates obtaining of accrual of information by the agency, the an advice

decision based upon (security all those a sse ssmen t)

matters by from the

ASIO agency

Section 61(2) can operate to pre-empt a consideration th Aslo advl'ce, which relevant matters and to convert e one factor (albeit important), into the ultimate decision.

and a

head. of all

is but

k 1. t clear that SAT findings ll. 39 A solution would be to rna e f any information provided are conclusive as to the correctness o and as to the nature of its advice by ASIO in an assessment,

245.

based on that information. The agency head, or a review body, would be obliged in making or reviewing a relevant decision to have regard among other things to the fact that the subject had received a security assessment from ASIO in the terms confirmed or modified by the SAT " s findings. The assessment in that form would then be considered in the context of any other relevant considerations in reaching a decision. The agency head would be

bound by the facts found by the SAT, but would not be bound to follow the advice.

11.40 An amendment along these lines would prevent rehearing of the issues contested before the SAT, preserve the responsibility of the agency head for the ultimate decision on a security clearance, and at the same time remove anomalies that are

inherent in the operation of s. 61 at present. I recommend that s.6l be amended accordingly to ensure that SAT findings are conclusive as to the correctness of facts provided by ASIO in an assessment, and as to the advice based on that information, but do not pre-empt the making of a clearance decision that is based wholly or in part on those facts or that advice.

Possible review of departmental decisions on security clearance 11.41 The submission on behalf of the Australian Labor Party proposed that:

To the extent that the Defence Department engages in its own security clearance procedure, persons adversely affected should have the same recourse to grievance mechanisms as is proposed in relation to ASIO.

11.42 As mentioned above (9.4 {h)), the Department of Defence does administer on behalf of the Government a special clearance system for people, whether or not employed by that Department., requiring access to specially designated categories of information. As part of that system, the Department obtains from / ' ASIO a security assessment. ASIO's assessment is subject to

review by the SAT in the ordinary way.

246.

11.43 It may be that the submission intends that, aside from the ASIO assessment, a grievance procedure should be provided in respect of the Defence Department's own actions and decisions under that system. If so, the argument could be extended to the decisions made by agency heads in regard to the granting of ordinary security clearances.

11.44 In considering this question it is useful to look first at the basis for the granting of security clearances. T here is no legislative provision for them. The present system rests on

administrative arrangements within departments and other agencies in accordance with policy laid down in the Protect ive Security Manual, the Security Assessment Manual and the Personnel Assessment Manual. Presumably the power is derived

ultimately from s.25(2) of the Public Service Act 1922, which provides that the Secretary of a Department shall, under the Minister, be responsible for its general working, and for all the business thereof, and shall advise the M inister in all

matters relating to the Department.

11.45 In essence a security clearance system is a convenient administrative mechanism for facilitating decisions within an agency on access to national security information (or controlled areas). The decision whether to allow anyone within an agency access to particular national security (or other) information

rests with, or derives, from a discretion in the agency head (and ultimately the Minister). The granting of a security

1 t 1 1. s a gu1∑ de to others that the employee c earance o an emp oyee may be allowed access to classified information up to the level

of that clearance. That is not to say that the emp loyee should

b h ∑ 1'nformat 1'on. That remains a manageria l e s own any part 1cular to "need to know ' and other discretion having regard considerations.

11.46 Understood in this way, there of any other pressing consideration, basis for security clearances. They

24 7.

is no need, in the absence for an express legislative represent just one among

many aspects of procedure in the management of government ∑agencies that are founded on executive directions.

11.47 As indicated above (11. 33) 1 the security clearance process is regarded, in practice at least, as separate from the promotional process (and other related processes such as the transfer of a person from one position to another). While the need for a clearance may be occasioned by a promotion or like decision, the processes are treated as distinct aspects of personnel administration.

11.48 As I understand the present position in practice:

an agency should not take action to promote someone to a position designated as requiring a security clearance unless and until the person is granted the necessary clearance;

if another person appeals against the promotion, the Promotion Appeals Committee is not to look at a security issue in the context of evaluating the relative efficiency of the provisional promotee and the appellant {Personnel Assessment Manual, Part IV, para. 27(j));

if the Committee is minded to overturn the provisional promotion and promote, or recommend the∑ promotion of, the appellant, it is to stay its hand until the appellant has obtained any necessary security clearance.

11.49 Assuming the position has been as I have described it, it would seem to me to be less clear now following amendments to the Public Service Act 1922 by the Public Service Acts Amendment Act 1984. Section SOA of the former Act, as amended by s.27 of

the latter Act, provides that regard must be had, in determining efficiency, to factors including " the capability of the officer to discharge those duties'. There would appear to be scope in that context for argument before a Promotion Appeals Committee about an officer's capability of handling national security

248.

material. My own v1ew however is clearance cannot be included capability of the officer to Appendix L, paragraph 4}.

that the refusal of a security within the description 'the discharge those duties' (see

11.50 Again, the legislation providing for the determination of an appeal does not make any express allowance for the staying of

the final step pending the obtaining by a successful appellant of any necessary security clearance.

11.51 None of this is to say that a Promotions Appeals

Committee has jurisdiction to revoke, or to grant, a security clearance. That 1s not within its prerogative. But it may be that issues bearing on a person's suitability for access to national security material could be canvassed in the course of

an appeal and, whether or not that occurs, that the appeals

process could result in an appellant, to whom an agency would not be prepared to grant a security clearance, in a position requiring such a clearance. In agency would not be forced to give the person

being confirmed that event, the access to any

particular information. Duties might be altered to obviate the problem. But the result would clearly be inconvenient at the least.

ll. 52 I suggest that consideration needs to be given to these questions with a view to deciding whether the

administratively-based security clearance system can any longer be accommodated satisfactorily with the statutory promotions process (and related personnel processes) or whether any amendment or new legislation is required. In my view it is most desirable that the clearance system should be maintained as a

separate process, notwithstanding the practical links between it and promotions and other personnel decisions.

11.53 There is at present no specific right of appeal against a security clearance, although regulation 33 of

an agency head's decision to deny an employee could take grievance action under

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the Public Service Regulations. Such a decision falls within a category of personnel actions that are excluded from investigation by the Ombudsman. In the absence of a specific statutory power under which such decisions are made, judicial review may not be open under the Administrative Decisions

(Judicial Review) Act 1977.

11.54 There is a very strong argument against making an agency head's decision to deny a security clearance subject to being overturned on appeal. Such a decision is an exercise of the agency head's discretion in protecting national security information or areas for which the agency is responsible. I find it difficult to see that, in the administration of an agency, the agency head could be directed by anyone (other than the Minister) to give a particular employee access to particular

information. The same difficulty obtains with any proposal that an agency head's decision to deny a security clearance should be subject to overrule by a person not bearing direct

responsibility for the protection of national security within the agency.

11.55 In making a decision on security clearance, a number of factors have to be weighed including:

"

"

the subject's personal particulars and characteristics

advice received by way of ASIO security assessment (as superseded by SAT findings where applicable)

the nature and level of access

the departmental context in which access will be obtained

the possible damage to national security if access is abused.

A decision of this kind ultimately requires value judgment and a degree of intuition. As indicated, I believe that the ultimate

250.

decision on a security clearance should, consistent with his responsibility for protecting national securit~ information or

areas in the agency, lie with the agency head. It wo uld be inappropriate in my view

subject to being overruled merit s.

to make such an executive decision in a full and general review on the

11.56 That is not to say that the facts upon the basis of which

a clearance decision is made, or the regularity of the process

by which a decision is arrived at, should be unchallengeab le and

beyond review. (I am here referring to those facts, and that

part of the process, which are not comprehended by an AS IO

security assessment which is already subject to review).

11.57 The options for some form of review would include:

(a) Providing by legis lation for the Inspector-General (see my recommendations in Chapter 16) to investigate a comp laint concerning a security clearance and to report on it to the relevant Minister. I would not favour an extensio n of the Inspector-General's jurisdiction beyond the securit y and

intelligence agencies and into departmental administrati on in this fashion.

(b) Amending the Ombudsman Act 1976 to confer jurisd iction on

the Ombudsman to investigate complaints about adm inistrative action in this area of personnel administration. I would regard this option as feasible and as having some attr action (bearing in mind that aspects having partic ular security

normally ar 1. se in the context of ASIO' s sensitivity would security assessment rather than of the departmental part in the process).

for notice to be given

to an

(c) Providing

d to deny a c learance,

employee, where an agency head propose of any facts upon which the agency head proposed to place

by legislation

to have a right to challenge reliance, and for the employee

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those facts upon a Appeals Tribunal or resort to the SAT

review by the SAT. for this

either the Administrat ive My inclination would be to

purpose, in view of the

connection with its role in reviewing ASIO securit y assessments. The review body's findings on the accuracy of any facts should be binding, but it would be for the agency head to grant or deny a clearance.

(d) Enabling an aggrieved employee to obtain judicial review under the Administrative Decisions (Judicial Review) Act 1977 of the decision to deny a clearance. Review under that Act does not go directly to the merits but rather to the

regularity of the process by which it was arrived at (e .g. whether it was made having regard to relevant

considerations). It would seem to be necessary, in order to achieve this result, to enact a legislative authority for the granting of security clearances (the present exclusion of ASIO security assessments from judicial review should be maintained).

11.58 In my view an argument can be made for a limited form of

review of departmental action, as outlined above, by the SAT. As a practical matter, and having regard to the fact that ASIO 's

part in the process is already subject to review, an effect ive form of review could be accorded by simply opening up the

relevant departmental action to investigation by the Ombuds man. I recommend that consideration be given to extending the

Ombudsman's jurisdiction (by an appropriate amendment of s. 5 ( 2) (d) of the Ombudsman Act 1976) to enable him to inquire into agency action in respect of the grant of security clearanc es but not so as to enable him to review any security assessment provided to an agency by ASIO or the SA T .

Alternatively, provision could be made for a limited form of review of departmental action, as outlined above, by the SA T . This would, as I see it, require the present administra tive scheme for the granting of security clearances to be turned into

a legislative scheme.

252.

Security Appeals Tribunal procedures ll. 59 The procedures before the SAT, the Act (11.6 11.8), reflect an

laid down in Part IV of

effort to balance the

objective of providing independent review of ASIO security assessments with the difficulty, in this area, of providing an applicant with full access to ASIO's case (see for example s.58 which effects a separation between the Tribunal's hearing of the

cases of the applicant and ASIO).

11.60 It has been submitted that applicants should be granted:

(a) access to their file (subject to the Tribunal's right to

protect the identity of informers or agents); and

(b) the right to cross-examine their 'accusers'.

11.61 In Chapter 17

individuals should be I consider a more general able to obtain access to proposal

any file

that that

ASIO may hold on them, and conclude that it would not be

feasible to confer such an entitlement. In the context of security assessments, s.38(l) already provides for the person to be given a copy of an adverse or qualified assessment and the

information on which ASIO relies other than information the inclusion of which would, in the Director-General's opinion, be contrary to the requirements of security. Beyond that, I believe the present approach in s.59, which is to rely on the Tribunal

to give the applicant such further particulars as he can and should be given, is a sensible and appropriate one.

11.62 I see difficulties too in providing a general right in the applicant to cross-examine ASIO witnesses. The qualification in 11.60 (a) above about protecting the identity of informers or agents will in itself effect a substantial limitation on the practical scope for any such right.

11.63 One option I have considered is to g1ve the Tribunal a discretion to allow one party to cross-examine the other part y

25 3.

or its witnesses, cross-examination. without conferring any right ∑such a provision would have to

to such

afford a

reciprocal right to ASIO to cross-examine the applicant. This option has some attraction as a facility which could be exercised that its pressure

by the Tribunal in special circumstances. I expect practical effect would be to place considerable on SAT, which it might find difficult to resist, to allow cross-examination.

11.64 While a right to cross-examine is of course part and parcel of judicial processes, and is common in quasi-judicial processes, it does not fit in with the carefully structured and balanced provisions in Part IV of the Act. In my view those provisions provide a workable and fair solution to a very complex problem. In practice they have provided aggrieved parties with an effective form of review. The case put by ASIO can and has been, I believe, effectively tested by the Tribunal without prejudicing security. The results of application, in terms of assessments overturned or modified, would seem to bear this out.

11.65 SAT submitted that it would be desirable for it to have the power to withhold from an applicant the whole or any part of the Tribunal's findings, particularly when the findings I contained advice to or criticism of ASIO, but without any j specification of the nature of the parts to be restricted. I I

11.66 The present position is that s.60(3) enables the Tribunal to direct that the whole or a specified part of its findings are not be communicated 1 so far as they relate to any matter that has not already been disclosed to the applicant 1 " The Tribunal states that this seems to refer to matters of fact i.e. of evidence, presumably emanating from the Director-General, which have not been disclosed to the applicant. The Tribunal points out that s.7l(d) enables it to prohibit or restrict the publication of its findings. The reason given by SAT in support of its proposal is that:

254.

The

it is sometimes desirable to offer advice or critic ism to the Director-General about procedures, or about methods of presenting his case or questions of proof. This involves matters of importance in the general administration of the Act, but which are of no relevance to an individual

applicant. It is not desirable for the Tribunal to communicate freely with the Director-General. It would be helpful if we were able to employ our findings as a means of communication.

proposal appears to have merit and I recommend that

consideration be given to an amendment to enable the SAT to communicate to the Director-General advice or criticism on matters such as procedures, methods of presenting his case or questions of proof.

ll. 67 There is a problem at present in regard to dissemination of the SAT's findings. The Tribunal is required to give copies

of its findings to the applicant, the Director-General and the

employing agency (s.60(3)). It has power to prohibit by direction the publication of the whole or any part of its findings on a review. Subject to any such direction, the applicant is entitled to publish the findings (s.60(4)}.

11.68 The apparent objective of protecting the privacy of the

applicant is understandable and appropriate. The provisions raise doubts however about the scope for dissemination of findings within the government notwithstanding that they may have implications for other agencies than the employing agency

in question. SAT has submitted that it should have a discretion to disseminate findings more widely than is now provided by

s.60(2} and, in particular, to the Attorney-General.

11.69 I certainly agree that the Attorney-General should be able to have direct access to findings of the T ribunal and that

his right to disseminate the findings within the government

should be made clear. That right should be subject to an

Ob ligation upon the Attorney-General to take reasonable steps to

Protect the privacy of the applicant (e.g. by deleting the

applicant " s name} except where the applicant has himself

PUblicised the findings. I recommend that the Act be amended

255.

along these lines to facilitate appropriate dissemination within government of the findings of SAT.

11.70 The SAT has also submitted that it would be useful if it had a discretionary power to order the Commonwealth to pay the expenses of a successful applicant. Section 82 already enables the Tribunal to order the Commonwealth to pay the fees and allowances of a witness summoned at the request of the applicant.

11.71 SAT does not suggest that, as a general rule, costs should follow the event, thus routinely entailing an order for costs in favour of a successful applicant. But it submits there may be cases, in particular those in which the adverse or

qualified assessment is largely or wholly due to an incorrect allegation of fact in the statement of grounds, where power to order costs would be proper. SAT says that 'it is only right to add that we have not yet encountered a case of this sort'. The submission has merit and I recommend that consideration be given to the des ir ability of an amendment to empower the SAT in an appropriate case to order the Commonwealth to pay the expenses of a successful applicant.

11.72 Another submission made to me is that a right of appeal should be allowed from a decision of SAT on a question of law. An alternative, along lines proposed by ASIO, would be to allow

the President, at his discretion and on his own initiative or at the request of a party, to refer a question of law to the court. Section 62 provides now that, subject to constitutional limitations, a decision or finding of the Tribunal is not subject to review by any court or other tribunal.

11.7 3 In practice, questions of law are unlikely to loom very large in SAT proceedings. I am however disposed to recommend that the President should be given a discretionary power to refer a question of law to the Federal Court. It should be possible for the President to refer such a question in a way

that will safeguard security.

256.

11.74 ASIO has drawn attention in a submission to the heavy burden imposed on it in preparing a case for argument before the SAT by reason of the fact that it is given no notice of the

particular aspects of its assessment that the applicant is calling into question. The applicant is required by s. 54 to do no more than apply in writing to the Tribunal for a review and

to lodge a copy of the assessment. ASIO has to be prepared to argue, and to call witnesses, in support of every part of the assessment.

11.75 ASIO' s workload would be reduced 1n some cases at least if the applicant was required to indicate in the application those parts of the assessment that were in dispute. I recommend that s. 54 be amended to provide for the applicant to indicate the particular facts or views in the assessment that are challenged and to provide a statement of the grounds upon which

the application for review is based.

11.76 It is convenient to deal here with a submission by ASIO in favour of an extension of SAT's jurisdiction. ASIO has drawn attention to an area where its advice can play a large part in the making of decisions adverse to the interests of an

individual. The area is the deportation of immigrants within 5 years of their entry to Australia, on the grounds relevant to security stated in s.l4(2) (b) of the Migration Act 1958. There is provision now in the legislation for appointment of a Commissioner to consider any objection or challenge by the person subject to deportation. ASIO has submitted that it would

be logical to extend the Security Appeal Tribunal's jurisdiction

to deal with any such objection or challenge.

11.77 I see merit 1n this proposal to the extent that what is to be reviewed is an assessment by ASIO. Whether it would be appropriate for the Tribunal to review any wider consideration of the issue by the Minister for Immigration and Ethnic Affairs, as distinct from review of the ASIO assessment, is a matter on which I do not express a view. I recommend however that

257.

consideration be given to the appropriateness of conferring jurisdiction on SAT in respect of objection or challenge by a person subject to deportation under s.l4(2) (b) of the Migration Act 1958.

258.

CHAPTER 12

PROTECTIVE SECURITY

Introduction 12.1 Protective security is a broad subject covering the

protection of people, information and assets against threat from

interference by way of violence, espionage, plunder, etc. from

any source (but for these purposes excluding natural disasters and accidental violence) "

12.2 ASIO's raison d'etre, recognised in s.l7(l) (a) and (b) of the ASIO Act, is to gather, evaluate and communicate to

Ministers and appropriate agencies intelligence relevant to security (as defined in s.4). In the Protective Security Review (PSR) 1979, , I described intelligence as the 'first line of

defence (against terrorism) 1 (5.1); this description could apply equally to the general role of intelligence in protective security.

12.3 Section 17(1) (c) gives ASIO a role in advising Ministers and agencies in respect of matters relevant to security (as

defined in s.4). This advisoiy responsibility is a broad one and encompasses preventative action, the 1 second line of defence' (PSR, Ch. 6) " Section 17 ( 2) , however, clearly defines the limits

of ASIO' s role.

It is not a function of the Organization to carry out or enforce measures of security within an authority of the Commonwealth.

Commonwealth agencies are responsible for their own protective security (subject, of course, to Ministerial or government direction) but they can look to others, including ASIO, for advice.

259.

12.4 This chapter is concerned with ASIO's role in protective security of government agencies their premises, their staff (and other persons on their premises}, information holdings and

assets generally. It addresses particularly the preventat ive acti on aspect, which ASIO refers to as 'physical and

administrative security'. I have found it necessary to consider

ASIO' s contribution 1n the broader context of government protective security generally.

12.5 Each government agency needs to consider a range of

securit y problems, from national security issues to criminal and other sources of threat. There will be differing emphases from

agency to agency but all agencies need to concern themselves w ith, at least, the following matters:

including building design, materials, physical security alarms, guards, etc.; communications security; technical security protection from electro nic eavesdropping; computer security- including word processors, etc.; adm inistrative security which covers such matters as 1 1

document access and handling

controls, etc.;

procedures, photocopying

personnel securi ty including security checking (wh ich is dealt with in Chapter 9), security education.

is common practice for departments some 12.6 It authorities) to have a Departmental Security Officer (and (DSO) or

equivalent, or sometimes a Security Section, responsible for assessing securit y threats and advising on monitoring, and/or impleme nting protecti ve security measures. A Senior Executive

Service officer may be designated to oversight the DSO's work and agencies may have a Security Policy Committee at senior level to provide guidance.

260.

12.7 In PSR, I pointed to what I saw as deficiencies in

identifying the proper role of the DSO, their selection and training, their access and authority, and their back-up and support (11.86 et seq.}. I recommended the formation of a specialist support group (an Inter-Departmental Protective Security Group {I PSG} } to provide the necessary back-up to DSOs

(11.138). I saw the IPSG's functions broadly as providing a central point of reference for DSOs, fostering communication, training and career development, providing a protective security consultancy service and certain specialist services to

departments and performing certain administrative tasks including field inquiries for security checking and leaks

investigations (11.139 et seq}.

12.8 In recommending the !PSG, I recognised that ASIO was a

specialist national security organisation, and primarily an intell igence body, not a protective security one. I felt that ASIO lacked the resources to provide the assistance required

(11.137). At the same time, I did not intend that the !PSG should detract from functions, including

ASIO's that of

relat ing to security (11.140).

performance advising in of its

respect statutory of matters

12.9 The Secretaries Committee on Intelligence and Security (SCIS) took the view that the !PSG was unnecessary. The SCIS

noted the difficulty in dividing the protective security effort

into conceptually distinct, but in reality overlapping, national

security and non-national security categories, with ASIO and the !PSG sharing the field. It felt that an !PSG would need to

duplicate the highly expensive professional engineering and

other expertise which ASIO had significa ntly increased since

PSR. It suggested that ASIO could undertake most of the

functions proposed for the !PSG. It saw this extension of ASIO's

I role as non-controversial but noted that amendment of the ASIO ~ ~ct could be considered if any serious object ion were raised.

IThe Government endorsed the SCIS proposal in May 1980.

261.

ASIO's supportive role 12.10 ASIO 's current role in protective security is thus to advise and assist government agencies. The effect of the then Government's decision in 1980 was extend ASIO's national

security advisory function to encompass protection of governme nt agencies from threats to their people, information and assets from any source.

12.11 ASIO's role in protective security matters as decided in 1980 is stated in the Protective Security Manual (PSM), produced later that year, in the following terms:

(a) Act as a central reference point for Commonwea lth departments on protective security matters.

(b) Upon request, provide advice and assistance to

Commonwealth departments on protective security matters. Provide a first point of contact for departments seeking specialised protective security assistance.

(c) Disseminate information to Commonwealth departments, as appropriate, on protective security matters.

(d) Upon request, perform specialised services of a protective security nature, and provide a protect ive security Consultancy service, for Commonweal th departments.

(e) Provide advice and assistance to Departmental Securit y Officers on protective security matters.

(f) In consultation with Commonwealth departments and the Public Service Board, co-ordinate and participate in Departmental Security Officer training arrangements.

(g) Participate in the investigation of leaks where national security considerations make this appropriate.

(h) Convene and chair the proposed Security Equ ipm ent Inter-Departmental Committee.

(i) Participate in the proposed Security Advisory Group.

(j) Advise the Auditor-General and efficiency auditing of protective procedures.

262.

inter-agency Co mputer

departments on security systems the

and

(The PSM defines 1 department 1 as meaning 1 authority of the Commonwealth' as defined in s.4 of the ASIO Act, i.e.

broadly any Commonwealth agency. ASIO notes in a submission to the Commission that: 'No restrict ion was placed (by the Government) on which Commonwealth agencies could seek

protective security advice from ASI0 1 .)

12.12 It might be noted that the reference in (b) to providing .a first point of contact for specialised assistance recognises

that there are other bodies with particular expertise and responsibilities covering particular aspects of protective

security, e.g. Defence Signals Directorate in relation to

communications security.

12.13 ASIO indicates that it approaches its advisory/consulting assistance to departments 'as a package combining physical,

administrative and personnel issues'. It is based on departments following a personnel assessment program consistent with the

Personnel Assessment Manual (PAM) and designating security

assessment positions consistent with the Security Assessment !~ M anual (SAM). I discuss personnel security checking in Chapter 9.

12.14 The starting point for security systems advice is the " development of a threat assessment, in respect to which AS IO

provides general advice regarding techniques but provides only a national security input to the actual assessment. Departments ,have to make their own overall assessments, drawing on the

"Australian Federal Police when appropriate.

12.15 Based on the threat assessment, including the

"department' s assessment of the functional and monetary value of

its various assets, ASIO provides expertise in security systems " design and in specific areas which it identifies as security electronics, security hardware and administrative security.

12.16 ASIO has established a departmental security training "centre in Canberra which it indicates 'requires a sizeable

263.

commitment of resources'. The program comprises six secur i tyll training courses, with two or three sessions of each annually,n and an annual Senior Executive Service Protective Securit w Conference. An annual senior DSOs' conference is also conducted'"

In consul tat ion with departments and the Public Service Board , ~ ASIO has developed selection criteria for DSOs.

12.17 ASIO has convened the Security Construction and Equipmentt Committee (SCEC) 'which acts as executive body to three

subsidiary working committees'. ASIO also chairs and support s= the three working committees which cover:

" Administrative Security Equipment, Security Hardware and Construction, and Electronic Security Equipment and Systems.

Various departments are represented on the working committees and assist in testing and evaluation programs. A Catalogue off! Security Equipment records the results of the committees' wor ~ and identifies acceptable security equipment for Commonwealt h) agencies.

12.18 ASIO is a standing member of the Computer Securit ~

Advisory Group chaired by the Public Service Board. It provides/ physical security advice for the protection of computem/ equipment.

12.19 ASIO is a member of a variety of other inter-departmenta working committees involved with protective security, includin g the following:

Working Party for the Security of the New Parliament House; Inter-departmental Committee on Security of Ministeria Accommodation;

" Standing Advisory Committee on the Security of Officia Establishments;

264.

Inter-departmental Committee on the Security of Explosives: Inter-departmental Committee on Fire Safety.

participates, through the Standing Inter-departmental for Protection Against Violence (discussed in hapter 5), in advising on security threats to, and physical

ecurity measures for, Vital National Installations.

SIO's performance 2.20 Submissions were sought and received from, and/or

iscuss ions were held with officers of, ten Commonwealth gencies, including those holding the most substantial volume of .ational security classified documents and some with other

articular interests in protective security. They generally _xpressed satisfaction with the advice and assistance they had

eceived from ASIO on protective security matters; indeed, most '.eld the physical and administrative security group in ASIO Head

ffice in high regard. The group appears to be technically c ompetent and keen.

' 2.21 Agency comments supportive of ASIO's protective security

onsultative service have included:

ASIO is generally able to provide helpful advice.

ASIO's support in the fields of physical security and administrative security is considered most helpful.

ASIO' s advice in relation to physical security matters is generally valuable.

On the occasions we have sought advice, it has been prompt and effective.

" ASIO has provided from time to time very useful advice on physical security matters. Advice on physical security is of a high standard and is provided willingly " " " The Department has found AS IO very

helpful 1n the provision of general advice on routine procedures, rules and regulations, methods of operation, etc.

.. The relationship which has been developed with ASIO is both harmonious and effective.

265.

" The advice is considered generally to be timely and of 9ood quality.

12.22 Against that positive background, I now mention three areas where room for improvement in ASIO's protective security advice was seen.

12.23 It was suggested first that ASIO sometimes recommends security systems which are beyond the budgetary resources of the client organisation. A physical security advice

'Rolls-Royce approach' was was sometimes described. how ASIO

A related

concern was that on occasions advice tends not to take account of the need for flexibility and operational efficiency. Complaints of this nature might be expected to be avoided if recommendations for the establishment or installation of

security systems were to be discussed in detail with the client prior could to finalisation, so that budgetary or other constraints

be taken into account. ASIO indicates that detailed discussions are held but more effort might be needed. I note that ASIO has recently promulgated to departments advice of the general philosophy underlying its approach. It may be appropriate for ASIO to give departments a number of options, outlining the level of security that will be achieved by each option.

12.24 The second area of comment concerns national security me that threat threat assessments. It has been put assessments would be more useful if they to

more detail rather than in in terms of specific targets, terms of high or low. I note

described threats in capacity and intent that a similar view

was expressed last year in an internal ASIO minute by a senior

officer of the physical and administrative security group who wrote:

For the protective security system designer (the same person who assesses the vulnerability), a general 'low threat' statement is not of great help. We need to know (for

instance):

266.

(a) is anyone likely to dedicate manpower to 'attacking' the target,

(b) are they likely to use explosives, high technology, etc.,

(c) are they likely to risk being caught in the act, or risk being photographed,

(d) or are they more likely to recruit internal staff to assist, or (e) are they likely to dedicate much time to a task, etc.

It would seem desirable for ASIO to explore the feasibility of issuing more detailed and informative threat assessments for the guidance of departments. ASIO indicates that this is being examined.

12.25 The third area of concern related to tardiness in advice,

particularly on inquiries that less-urgent the physical

projects. It appears from my and administrative security group

has a substantial workload. When presently vacant positions are filled, and as newer staff develop further expertise, the

pressure may ease. However, as mentioned below, protective

security is a growth area, and ASIO can expect increasing demands on its resources.

12.26 Several agencies commented favourably on the work of the

' Security Construction and Equipment Committee and its subsidiary

1 working committees. The availability of the Catalogue of

Security Equipment as a ready reference seems to be particularly appreciated.

12.27 Again, agencies seem to appreciate the training courses

co-ordinated by ASIO. Comments include:

The comprehensive program of security training courses made available by ASIO since 1982 has been well planned and managed and provides departmental security staff, not just DSOs, with a means of gaining valuable knowledge of security matters not readily available from other sources. The presentations have generally been relevent and of high

standard.

267.

"

"

We do receive significant and useful support from ASIO in the field of security officer training. An expansion ... would be welcomed (to cover more staff).

The training program introduced by ASIO covering physical and personnel security has been the subject of complimentary reports by my Security Advisers.

Security officers have attended several considered them beneficial and worthwhile. courses an d

Security staff attending ASIO training courses report a considerable improvement in the standard of the courses arranged by ASIO in recent years. The coverage, relevanc e and presentation are now all rated highly.

The Department supports the very professional and useful courses provided by ASIO to meet the specific needs of Security Officers.

12.28 Some reservations on the training program, raised by one or two agencies, which ASIO might consider, include:

" A suggestion that the courses, in addition to impartin g

knowledge to DSOs, might encourage them to concentrate mor e on security planning rather than just securit y

administration. Although benefit was seen 1n general courses having a mix of students with varied background and different levels of experience, some need was seen to also bring together in more specialist courses DSOs with common interests (e.g.

those from departments with a high level of nationa l security material). More practical exercises and/or syndicate exercises might help to complement theoretical sessions. One department felt that the Senior Executive Service

seminar focussed too much on national security issues to be of value to its officers. " A half-day or day seminar on security management issues wa s

suggested for DSOs and their line managers.

I am aware that ASIO consulted agencies in preparing its 1984-85

program. It may find value in having one or two experienced DSO s assist in settling its training programs. 268.

Security audits 12.29 As noted in 12.11 (j), ASIO is required by the PSM to

advise the Auditor-General and departments on efficiency audits of protective security systems. ASIO has advised the

Auditor-General and departments on efficiency audits of protective security systems and procedures. Written guidelines have been developed, ASIO has participated in related training

courses and it provides advice in response to requests arising from the Auditor-General's ongoing program.

12.30 A series of Government decisions in 1980-82 endorsed a role for ASIO in reviewing the standard of protective security arrangements in agencies handling national security classified material and in following up any deficiences. ASIO suggests

that, in view of s.l7(2) of the ASIO Act which precludes it from carrying out or enforcing measures for security within an agency, ASIO must be invited by the agency before it can

undertake such a review. In the PSR, in response to a similar submission from ASIO, I repeated a view expressed 1n RCIS and stated that ASIO's 'function of giving advice and of

investigating security breaches is not under the ASIO Act conditional on that advice having been sought' (11. 58). I again reject the view that s.l7(2) requires ASIO to await an invitation from an agency before reviewing its procedures; this

would particularly apply where the review is concerned with national security, and where the Government has endorsed the role for ASIO. That is not to say that ASIO should not seek the co-operation of an agency before initiating a review of its

procedures.

12.31 I am sympathetic to ASIO' s views that a review of the protective security procedures throughout a large organisation, such as the Department of Defence, would be 'an enormous task'. ASIO has indicated that its 'ability to undertake the reviews

while servicing its other responsibilities was severely limited by resources and the availability of qualified staff'. ASIO also

suggests that it would be more manageable for it if it were made

269.

clear to departments that the onus was on them to review their protective security procedures, consulting ASIO as necessary; the Auditor-General's Office would monitor departments' performance through its protective security audit. It appears

that ASIO has not to date undertaken any security auditing of agencies, although it has, of course, inspected security aspects of agencies as part of its consultancy service.

12.32 Three agencies raised the question of security auditing in submissions to me:

Department of Defence expressed some concern about the Auditor-General's approach in a series of being undertaken at Defence installations question of training of Audit Office staff.

security audits and raised the

Department of Housing and Construction expressed concern that ASIO was not undertaking security audits (for which it thought ASIO was responsible) "

Department of the Treasury noted that ASIO apparently had not conducted the check of its security envisaged under the decisions of the Government in 1980-82.

12.33 I see merit in ASIO's view that, as a practical matter, departments must accept primary responsibility for reviewing their own protective security systems, consulting with ASIO as necessary, and subject to audit by the Auditor-General from time to time. ASIO should assist the Audit Office in ensuring that staff are appropriately trained; ASIO indicates that it has responded positively for requests for assistance. The Audit Office staff should not hestitate to draw on the expertise of ASIO where necessary.

Physical security 12.34 The PSR report suggested that 'It might be beneficial, too, for the responsibilities of the respective parties in

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relation to physical security to be stated with precision' (11.269). Arising from this, a two-part statement has been prepared by a group of interested departments, 'Statement of Responsibilities of Parties for Physical Security in Commonwealth Buildings' and 'Statement of Consultative Processes

for Physical Security of Commonwealth Buildings'. The statement was broadly endorsed earlier this year by SCIS, subject to some

minor suggestions.

12.35 The statement identifies the following organisations which are involved in security of Commonwealth property:

ASIO.

Department of the Special Minister of State (SMOS) Australian Federal Police (AFP) Protective Services Co-ordination Centre (PSCC).

Departments and authorities as occupants.

Departments and authorities as sponsors of special purpose buildings.

Department of Administrative Services (DAS) as sponsor of office buildings Property Directorate.

Department of Housing and Construction (DHC) .

National Capital Development Commission (NCDC).

12.36 The statement recognises ASIO's role in providing advice on establishing secure areas and including advice, on request, where there is no national security threat. Consultation with ASIO is required for Risk Category 3 buildings (material Confidential or above, sensitive material, high asset value,

vi tal national installations, etc.). For Risk Category 2 buildings (Restricted material, medium asset value, etc.), ASIO

271.

is to have a biannual monitoring role; for Category 1 buildings (unclassified, etc.), ASIO will have no role. DHC will provide protective security advice for Category 1 and 2 buildings.

12.37 ASIO

statement as has expressed now drafted

concern that promulgation of will significantly increase the

its

protective security workload. This concern is apparently related to the notifying of ASIO " s role in Category 3 as mandatory. Under the 1980 Government decision, of course, it would be open to agencies to seek ASIO " s advice in relation to buildings in any of the categories.

'Leaks' Investigations 12.38 I note that, in contrast to other aspects of the protective security role allocated by the PSM, the extent of ASIO's role in leaks investigation is limited to cases 'where

national security considerations make this appropriate' (12.ll(g)). It may be that the SCIS saw this function as a potential exception to the non-controversial nature of the other functions.

12.39 ASIO submits that, if an investigation is directed towards a prosecution under the Crimes Act 1914, it is more appropriately carried out by the Australian Federal Police (AFP). It also suggests that, if the purpose is to determine what departmental administrative action should be taken against an officer, any information provided by ASIO concerning the officer would be subject to the provisions of Part IV of the ASIO Act (the security assessment provisions). It indicates

concern that involvement in such investigations may make it appear to perform an executive function and may inhibit the willingness of officials to co-operate with it on future occasions.

12.40 Whilst ASIO's reading of its legislative position may be a conservative one, I am inclined to agree with its conclusion

that it should not be directly involved in the investigation of

27 2.

leaks, except investigating suspected. To

through the provision of advice to the

team or where espionage or subversion are

the extent that ASIO has a consultative role in protective security, of course, it could also be called in to advise on any failing of the protective security system implied by the leak.

12.41 I discuss further in my General Report the question of leaks investigation and the relevant legislative provisions.

Protective security policy 12.42 One important aspect of protective security which has tended to languish whilst "ASIO has been the central reference point has been protective security policy development. As a

non-executive agency, isolated from the mainstream of policy departments, ASIO has not been in a good position to develop and obtain Ministerial endorsement for security policy and oversight implementation. There is a need for a department (and a

Minister) to be given clear responsibility for protective security policy. This requirement applies independently of the question of whether ASIO's consultative role is to be retained. I now illustrate that need by reference to an example which has come to notice during my inquiries; it has not been handled by

ASIO.

12.43 A detailed procedure for handling sensitive documents was introduced in May 1982. The procedure was to have been reviewed after six months by the interdepartmental committee responsible for the PSM, which is chaired by Attorney-General's Department.

I understand that no review has been undertaken and I suspect

that the procedure has lapsed. At least one department has introduced a somewhat simpler system of its own. Another aspect of document handling I noted during my inquiries was the

disparity between control procedures applied to different categories of documents. Documents of limited sensitivity in one category may be subjected to stricter accountability procedures than documents in another category which may often be of greater

sensitivity.

27 3.

12.44 There would seem to be a need for a review to establish whether the PSM requirements are adequate for national security classified material and, if so, whether some adaptation could not take care of other sensitive documents.

Implications of ASIO's role in protective security 12.45 ASIO's extended role as a central reference point on protective security matters, potentially covering all Commonwealth agencies, raises three questions:

the legislative authority for such a function; the implications for diversion of attention from its main national security intelligence role; and whether there are other agencies better placed to perform the role.

Legislative authority 12.46 As noted in 12.3, ASIO derives authority for its

protective security advisory role in the first place from s.l7(1) (c) of the ASIO Act; this paragraph declares it to be a function of the Organization 'to advise Ministers and authorities of the Commonwealth in respect of matters relating to security, in so far as those matters are relevant to their functions and responsibilities'. 'Security' in that context bears the meaning given in s.4 of the Act, that is, the

protection of the Commonwealth and its people from espionage, sabotage, subversion, active measures of foreign intervention or terrorism.

12.47 It may be that, for a department with national security material to protect, advice profer red by ASIO in relation to protection of such material would serve incidentally to protect the staff, information holdings and other assets of that department against any form of threat. But this might not always be the case, particularly for a department with a spread of functions and locations. At the other extreme, it seems doubtful that advice to an agency, with no national security connection,

274.

as to how to protect its assets from theft could be sustained as advice in respect of matters relating to security as defined in s.4.

12.48 The decision by the Government in 1980 to make ASIO a

central reference point in protective security was taken in the context of SCIS advice that protective security advice in non-national security matters would be non-controversia l but consideration could be given to amending the AS IO Act if any serious objection were raised in the future. Although I am not

aware of any controversy being raised, I believe that it is important for an organisation such as

legislative base for all its functions. be taken to amend the Act if ASIO is

broader responsibility.

Resource implications

ASIO to have a clear

I suggest action should to continue with this

12.49 ASIO indicates that it 'has significantly increased its capacity to handle requests for physical and adm inistrative security advice. It has developed expertise in security electronics, security hardware and administra tive security, and

the application of that to physical and administrativ e security systems design'. I noted in 12.16 that p rotectiv e security training requires a sizeable commitment of resources. ASIO ' s concern at the potential workload arising from the sta teme nts on physical security in Commonwealth Buildings was noted in 12.37.

12.50 ASIO has submitted that I should find that its role in

protective security matters 'should be precis ely defined and restricted to matters relevant to national security'. ASIO

envisages that, in situations where primarily non-nationa l

security matters are involved, security adv ice would be provided by the Department of Housing and Construction. ASIO suggests

that functions (a) to (d) listed in 12.11 should, like (g), be restricted to national securi ty aspects only . It says 'no

significant alteration would be required' for functi ons (e) to

(j). I take this to mean that there is no d ifficulty seen 1n

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advising and training DSOs on broader protective security issues, in chairing the SCEC or in advising on broad security auditing.

12.51 Members of the relevant group within ASIO have, however, drawn attention to the difficulties of splitting the broad consultancy role that they prefer into national and non-national security streams. It was pointed out that it can be very difficult to determine where 'national security' starts and finishes. Reference was made to the fact that many consultancy tasks inevitably involve the design of protective security systems to meet both national and non-national security threats. For instance, a recent report on security at HMA Naval Dockyard, Williamstown, canvassed not only the protection of national

security information and equipment but also protection of assets against pilferage.

12.52 I do see a difficulty in having two teams of experts, one dealing with national security threats and the other dealing with criminal and other threats, making recommendations on the same site. Protective security systems and procedures are to a

significant extent (but may not be entirely) common to both classes of threat. It does not seem practicable to divide protective security measures for a particular site or building into national and non-national security compon~nts and have each component serviced by a different body. To some extent this difficulty could be avoided by allocating responsibility for different categories of agencies to one or other team, as proposed for building security in the statement discussed in 12. 34 12. 37. But even that statement proposes a measure of dual responsibility for Category 2 buildings.

12.53 Again, I have difficulty with the concept that the body responsible for advising and training DSOs, advising on security audits, etc. could perform these tasks as effectively if its general protective security consultancy responsibilities were to

be removed from it. I am inclined now to support the conclusion

276.

reached by SCIS (12.9) that duplication of highly expensive professional engineering and other expertise should be avoided.

12.54 If a single body is to continue to provide a consultancy

service on physical and administrative security (and to support

the DSOs etc.) , there is a question whether that body should continue to be located in ASIO. Several arguments supporting the continuation of present arrangements were put to me by ASIO officers involved. First, it was claimed that much valuable

information is provided by overseas security services which are prepared to deal only with another security service.

12.55 Secondly, it was claimed that ASIO has established a very

good relationship with the security industry in Australia, that

such a relationship is a great advantage in carrying out the

protective security advisory role, and that a departmental body would not be able to develop the same sort of relationship. It

was said that firms are often prepared to discuss their products

frankly and in detail with ASIO, even to the extent of

discussing confidential technical data and problems they are having with particular products and the remedial action they

have under con~ideration.

12.56 Thirdly, it was put to me that ASIO derives credit from the performance of this generally accepted function, and that this helps to gain acceptance for the Organization as a whole.

12.57 There is I think some force in the first argument, but in relat ion to the second I am unable to see why a body outside ASI O would not be able to develop a similar ly close working

relationship with the security industry in this country. I do not attach a great deal of importance to the third argumen t.

12.58 An other argument in favour of maintaining the status quo is that ASIO will continue to have a legitimate requirement for its own protective security experts to advise it on its security no matter what capability is developed elsewhere, but then so do

277.

other Commonwealth agencies. It was further suggested on behalf of the Assistant Director-General in charge of the function that it would be necessary to allow 'something like a five year transitional period of joint staffing' to transfer the capability to an organisation such as PSCC. This seems to envisage an extraordinarily long learning curve. It also presumes there would be no movement of existing trained staff to

the other body.

12.59 On the other hand, protective security is a 'growth area ", and the demand for physical security advice is likely to increase rapidly. Protective security inspections performed by the group in ASIO Head Office have grown from 40 in 1980 to 60

in 1983. Seventy-two inspections were conducted in the period January September 1984. The number of protective security inspection jobs which did not predominantly involve national security matters increased from five in 1980 to 25 in the period January-September 1984. With an expansion in the demand for protective security advice and with an increasing involvement in

the testing of equipment, I can see this group requiring more and more resources from the Organization to the possible detriment of its primary intelligence role.

12.60 ASIO is presently providing a broad protective security service, and appears to be doing so competently, if perhaps not as extensively as was envisaged for it at the outset. There is, however, in my view, no intrinsic reason why advice on

protective security must be dispensed by a security intelligence service. It is not essential that the responsibility of the providers of intelligence as the 'first line of defence' carry through to co-ordinating advice on the 'second line', the preventative action. The two are disparate functions although

there is a link between them. ASIO will have an important

contribution to make to protective security policy development; its views on national security threats will be a key input to systems design. It will also need to maintain a capability in this area for its own defensive purposes. It will continue to

278.

need access to technical and other expertise of overseas

services and could still provide information to others based on that expertise.

Alternative arrangements 12.61 In suggesting in PSR an

Security Group, separate from ASIO, Inter-Departmental Protective I envisaged that ASIO would

continue to have responsibility for advice on national security related protective security. I do not believe on reflection that that is necessary. SCIS rightly saw difficulty in splitting the protective security advisory responsibility. I now suggest that

the whole function could without undue harm be separated from ASIO " s security intelligence function - as indeed has long been

the case in relation for example to the responsibility for co-ordinating counter-terrorism arrangements.

12.62 It has been suggested by ASIO that:

ASIO would assume responsibility for the protective security matters relevant to national security, and the Department of Housing and Construction (DHC) would assume responsibility where primarily non-national security matters are involved.

12.63 I can see merit in DHC playing a major role in relation to physical security (particularly building design, materials,

etc. ) , with its larger professional engineering and technica l staff and its testing capabilities. This might apply whether national security is involved or not. But I would still see a need for consultation with a central protective security

reference point. The risk categorisation approach discussed in 12.36 may well provide appropriate guidelines for division of

responsibility between DHC and the co-ordinating body.

12.64 As discussed above, the PSR Report proposed the IPSG as a

central reference point to which Commonwealth agencies could turn for advice or assistance on protect ive security matters.

The fundamental objective of my proposal was to provide back-up

support for the often untrained and inexperienced DSO, often endeavouring in isolation and with minimum direction to cope

279.

with the many-faceted protective security concerns of his agency. Whilst, thanks largely to ASIO, DSOs are now bette r trained and have access to better documentary instructions such. as the PSM, PAM and SAM and the Catalogue of Security Equipment, I still see a real ongoing need for such a central referenc e

point to support DSO' s and departments. DHC would not be an appropriate agency for such a function.

12.65 In the PSR, I indicated that the proposed !PSG needed to be centrally located and within a large department or authority. The Public Service Board, the then Department of Productivity (Security Advisory Office) or the Department of Administrative Services were suggested as possible locations; the latter department then being responsible for the PSCC as well as having

the Property Directorate.

12.66 The PSCC is now part of the Department of the Special Minister of State (SMOS). It is responsible for co-ordination of advice to Government on protective security arrangements in matters of terrorism and other forms of politically motivated violence. In these areas it has the responsibility for co-ordination of implementation of protective security measures based on intelligence and threat assessments from ASIO.

12.67 PSCC, almost by default in the absence of any other

responsible agency, has been given responsibility for developing protective security measures for the new Parliament House {ASIO has provided a project security officer), Ministerial accommodation, official establishments, explosives storages and Vital National Installations. It chairs the relevant committees listed in 12.19. Although each area of responsibility is related to its counter-terrorism role, these areas all involve broader protective security questions.

12.68 SMOS would thus appear to me to be the most appropriate department to which to give responsibility for co-ordination of protective security policy. It would also be the logical

280.

repository of an IPSG type group if ASIO's role in this respect were to be reduced. To what extent the responsibility could be

absorbed by PSCC I have not endeavoured to assess, but clearly it would need to be closely associated with PSCC in the SMOS organisation.

12.69 Ultimate responsibility for protective security must remain with individual agencies. Thete is also a need for advice on specialist aspects from agencies with specialist expertise,

e.g. DSD for communications. For these reasons high level co-ordinated direction is necessary. SCIS has a role in considering aspects of national policy that arise from time to time but SMOS, if given new responsibilities for protective

security policy and advice, would need to convene a

co-ordination committee at high level - at least Division Head and with representatives of ASIO, key contributing departments

and the main user departments.

Conclusions and recommendations 12.70 ASIO has made commendable efforts to provide the back-up support for DSOs and a central reference point for departments on protective security matters which the PSR found to be sorely

lacking. Some areas where improvement could be made were

suggested by agencies.

12.71 Nevertheless, I question the appropriateness of this role for ASIO and see a prospect of involvement in this growth area distracting ASIO from its basic responsibilities. ASIO itself recommended to me that its role should be 'restricted to matters

relevant to national security'. But this artificial distinction was rejected earlier by Department Secretaries and I believe

rightly so. There will be increasing demands on resources, both staffing and financial, for this function which is divorced from ASIO' s primary .intelligence functions. To the extent that ASIO

is to be involved, its legislation should recognise this.

12.72 The need for central ministerial and departmental policy direction and the current PSCC involvement in various aspects of 281.

protective security lead me to conclude that SMOS should be given overall responsibility for protective security policy and to suggest that it also might take over the role that ASIO has played in protective security co-ordination, including physical and administrative security. SMOS might also then be the appropriate location for a Personnel Security Checking Bureau

(9.61).

12.73 I recommend that serious consideration be given to the allocation to SMOS of responsibility for protective security policy and co-ordination:

including the national security related requirements;

including convening the various committees which ASIO now chairs; protective security

the physical and administrative security functions in SMOS to be incorporated with, or closely related to, the PSCC.

12.74 I stress that ASIO would continue to be responsible for intelligence gathering and threat assessment and would still have an important role in protective security advice:

"

it would be a key member of relevant comm1ttees (as it is in relation to PSCC);

it would continue as the contact with overseas intelligence agencies;

it would ret a in the responsibility for its own protective security.

12.75 Subject to possible review by the proposed co-ordinating committee, I envisage other specialist agencies continuing with their existing responsibilities for advising on particular aspects of protective security:

282.

including DSD's responsibility in relation to communications security (which also has implications for computer security);

but chairmanship of the Computer Security Advisory Committee could possibly transfer from the PSB to SMOS;

the sharing of responsibility for advising on physical security of buildings between ASIO and DHC, as endorsed in principle by SCIS, might continue between SMOS and DHC.

12.76 I believe that SMOS should

Attorney-General's Departmental responsibility related protective security matters.

take for

over from

the PSM and

12.77 I recommend also that a high level committee be convened by SMOS to co-ordinate protective security policy and physical

and administrative security measures, with representation from

ASIO and other agencies with specialist security expertise and

from the major user departments. An early task of the committee

should be identify and initiate action to ensure early resolution of long outstanding policy issues, such as sensitive document control systems.

12.78 I recommend that protective security be identified in the Administrative Arrangements Order as a function for which the Special Minister of State is responsible.

12.79 I recommend that it be made clear to agencies that

primary responsibility for review of the protective security

systems rests with them, consulting SMOS as appropria~e, and

subject to periodic audit by the Auditor-General.

12.80 In the event that ASIO is to have a continuing protective

security role extending beyond security as defined in the ASIO Act, I recommend amendment of the Act to recognise that function.

283.

12.81 I suggest attention by ASIO and SMOS, as appropriate , to the agency suggestions for improvement indicated in 12.21 to 12.23 and 12.26.

284.

CHAPTER 13

MANAGEMENT OF ASIO

In accordance with the recommendation of Mr Justice Hope at

paragraph 1.16 this chapter has been deleted.

285.

CHAPTER 14

PERSONNEL ADMINISTRATION

In accordance with the recommendation of Mr Justice Hope at

paragraph 1.16 this chapter has been deleted.

286.

CHAPTER 15

FINANCE AND RESOURCES

FUNDING AND STAFFING

15.1 In RCIS I suggested:

That the Government recognise that, in the future, quite large sums will be needed to improve ASIO's capacity; that those giving consideration to ASIO's budgetary bids take into account that past levels of expenditure should not be taken as a realistic benchmark.

15.2 ASIO expenditure has grown from $7.8m in 1976/77 to

$27.176m in 1983/84, and an appropriation of $32. 749m is available in 1984/85. (The latter two figures do not include provisions in budgets of other agencies attributable to ASIO' s new building and re-location, amounting to $7. Om and $8. 8m in

1983/84 and 1984/85 respectively) " The Department of Finance indicates that in constant 1982/83 prices the growth has been from $13.542m in 1976/77 to $25.325m in 1983/84 and $30.007m in 1984/85, indicating a potential real increase in expenditure of 122% in eight years.

15.3 ASIO has been given significantly increased resources, consistent with my RCIS recommendation. While I have not

attempted to evaluate in any detail the appropriateness of the present allocation of resources to AS IO, I do not have the impression that there is a need for any further significant increase in resources at present. Indeed, while some areas in ASIO may be stretched for resources, my impression is that

others are not, and that there is scope for some re-allocation of resources among present functions. There may be scope for

savings in some areas as a result of changes that I suggest in ASIO's responsibilities and following review of the present

allocation of resources, including to regional offices.

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FINANCIAL ADMINISTRATION

RCIS and response

15.4 In RCIS I found that matters of management, including " had not had the attention in ASIO that they financial affairs, needed " (4 :I ,15). I reported that 'my preliminary investigations have revealed that ASIO' s financial procedures are capable of some improvement' (4:I,477).

15.5 In RCIS I made a number of recommendations, some in a

volume which was published (4:I), and some in one which was not (4:III), relating to ASIO's financial administration. Action has since been taken broadly in line with the objectives of those recommendations, if not totally in terms of the means I suggested. I discuss particular RCIS recommendations in this section; others of some relevance to financial affairs are discussed in the next section on ASIO auditing.

Legislative framework 15.6 Following a suggestion by the Department of the Treasury, I recommended in RCIS:

15.7

Insertion (into the ASIO Act) of provisions relating to financial and auditing arrangements somewhat similar to those now regularly inserted into such statutory authority legislation. The provisions to include:

(a) Authority for ASIO to operate bank accounts.

(b) A requirement for ASIO to keep proper accounts and records.

(c) A requirement for the Auditor-General to carry out an audit, subject to the preservation of secrecy in respect of operational matters (4:I,771).

For reasons which I have not been able clearly to

establish, action was not taken to insert financial provisions in the ASIO Act. Instead, ASIO was defined as a department for the purposes of the Finance Regulations (see Regulation 4) and the Director-General of Security was defined as its 'Permanent Head' (now Department Secretary) " I am advised that this had the effect of making the Director-General responsible for ASIO's

288.

compliance with enabling warrant the Finance Regulations and Directions authority to be granted direct to

and

him.

Previously ASIO 'accounting officers' would have been subject to the Audit Act and subsidiary legislation but the Secretary to the Attorney-General's Department would have had the Permanent Head responsibilities.

15.8 The main purpose behind the RCIS recommendation was that:

ASIO should, to the extent possible, be required to follow the processes which apply in other areas of government administration. Money affairs should be subject to maximum possible audit provisions; as far as possible Treasury

requirements for proper expenditure of public funds should apply.

I continue to see it as desirable that ASIO should be subject

to, and should follow, financial and administrative procedures generally applicable to government agencies except where agreement is reached that those procedures are not appropriate for ASIO's circumstances.

15.9 There are various legislative options available to achieve the purpose of requiring ASIO to comply with financial processes applicable elsewhere in government administration. Incorporation of provisions in the ASIO Act was one option; declaring ASIO as

a department under Finance Regulations was another. A further

option would be to declare ASIO in the ASIO Act to be a public authority to which Division 3 of Part XI of the Audit Act 1901 applies - ASIO would also need to be made a body corporate, or Audit Act s.63C would need to be amended to permit the

application of Part XI to non-incorporated public authorities.

15.10 that: In a submission to me, the Auditor-General has suggested

Although no difficulties have so far arisen consideration might be given to whether, for administrative convenience, the Audit Act should be amended to incorporate ASIO within the definition of a Department for the purposes of section

2AB.

289.

∑ '

.,

The purpose would be to make the Director-General of Security responsible as Department Secretary for making appropriate arrangements for implementing the provisions of the Audit Act (in addition to subsidiary legislation), a responsibility which is still vested in the Secretary to the Attorney-General's Department. The practical effect would be to transfer to the Director-General responsibility for the annual provision to Finance of the details of receipts and expenditure which the Department Secretary is to provide under s.SO of the Audit Act.

15.11 I understand that the Department of Finance has no strong views as to whether ASIO's financial responsibility would be better prescribed under the Audit Act, either as a department or as a statutory body, or within the ASIO Act The relative

merits should be considered by relevant departments. If ASIO is to continue to be treated as a department, then I would support the Auditor-General's suggestion that the Director-General be given full responsibility under s.2AB of the Audit Act.

Conduct of financial affairs 15.12 ASIO's appropriation appears as a single line item 1n the Attorney-General's Department appropriation in the annual Appropriation Bill No. 1 (any additional appropriation appears

similarly in Appropriation Bill No. 3). In RCIS I concluded that 'a suggestion that ASIO' s estimates be published "under broad headings" could not be adopted with security' (4:I,712). No submission has been put to me contesting that RCIS conclusion. I see no reason to depart from it.

15.13 In RCIS I recommended

considered by the proposed security (now the Security (SCIS)) Secretaries

in the

that ASIO' s annual estimates be committee on intelligence and Committee on Intelligence and context of the total

intelligence/security budget. ASIO's annual estimates and forward estimates are prepared within ASIO in consultation as necessary with Department of Finance. Following endorsement by the Attorney-General, they are submitted for examination to SCIS

290.

and then to the National and International Security Committee of

Cabinet (NISC). This appears to me to be an appropriate

procedure.

15.14 Oral advice from the Department of Finance indicates that it finds ASIO's performance in preparation of estimates, budgetting, etc., generally better than average. ASIO is seen to be thorough in its preparation of estimates and quite

professional in its resources management generally.

15.15 As to other financial processes applying generally in government administration, there seems to be some doubt held by Department of Finance as to whether ASIO has strictly followed the appropriate procedures. In the one or two instances which

seem to have given rise to this feeling, however, I have found

no evidence that ASIO has sought to disregard the official

instructions. (There has been Ministerial correspondence on the question of whether ASIO obtained the necessary approvals covering changes to its new building plans. Some question was also raised as to whether ASIO is following the procedures for acquisition of ADP capability. My conclusion is that ASIO has

endeavoured to abide by the prescribed procedures where they are clearly promulgated and applicable, although some departures have occurred in practice.

15.16 There does seem to be a need for the central

co-ordinating agencies in Canberra to address the question of the extent to which the procedures they promulgate are intended (with appropriate authority} to apply to statutory authorities, such as ASIO. The Public Service Board, no doubt reflecting its statutory position, addressed its circular on 'Procedures for

the Acquisition of ADP Capability' to 'All Departments and Statutory Authorities staffed under the Public Service Act', thus implicitly excluding ASIO. It may be necessary for the Attorney-General's Department, in appropriate instances, to

propose to the Attorney-General that he draw such circulars to the attention of the Director-General of Security and seek ASIO compliance. 291.

∑'

15.17 Concern about ASIO's financial procedures (15.4) led me to suggest in RCIS:

That consideration be given by ASIO to the engagement or appointment of appropriate experts to review the entire system of accounts and to recommend improvements (4:I,78 5).

15.18 ASIO insti tuted such a review, with representatives from the Auditor-General's Office, Department of Finance and AS IO.

The review team reported in December 1978 with a considera ble number of recommendations for improvement of ASIO' s accounting records and procedures. The review team considered that it s principal recommend ations in the following areas 'should be treated with some degree of urgency':

"

preparation of an Administrative Procedures Manual, review and revision of all delegations, revision of the payroll system, discontinuation of use of 'Bank'cheques, appointment of an officer as internal auditor for the No. 1 Account as well as the No. 2 (exempt) Account.

15.19 ASIO has made considerable efforts towards implementati on of the review team's recommendations and has gone a long way towards completing its Administrative Officers Procedures Manu al (AOPM) - some sections of which have been through more than one

edition. Nevertheless, I note that although six years have now elapsed there are still some outstanding matters. Some of the audit queries over the years since 1978 would not have arisen had the recommendations of the review been implemented more promp tl y. I urge that high priority be given to finalisatio n of

the outstanding recommendations including completion of the AOPM .

15.20 I note in the next section that external and internal auditors have raised queries relevant to ASIO's conduct of its financia l and related affairs, but ASIO's performance is not seen to d iffer signifi cantly from average.

292.

15.21 ASIO is to be commended on its efforts to overcome the earlier lack of clear instructions for its staff. The Administrative Officers Procedures Manual (admittedly some years in preparation but now nearing completion) is the primary

example. Earlier this year, ASIO issued instructions concerning the handling of its exempt expenditure 'Operational Finance (No. 2 Account) : Policy and Procedures for Disbursement of Funds'.

15.22 Although concerted effort instructions, has been addressed to

there is a tendency for preparation of financial these to be detailed in terms of the mechanics of processing paper but not to give much guidance, in terms of factors to be taken into

appropriate account, to and consistent assist decision-makers in making

decisions. More effort is also

needed to keep instructions up to date.

Conclusions and recommendations 15.23 There is a need to determine the most appropriate

legislative framework for ASIO financial administration " There should also be no doubt that ASIO is required to follow

generally applicable financial agreed with the responsible procedures, authority

except where it is that they are not

appropriate for ASIO's circumstances. ASIO should be given clear notice of relevant procedures. Subject to these comments, the framework within which ASIO's financial administration takes place is considered to be satisfactory.

15.24 ASIO has made substantial improvements in its financial procedures but there is still some work which needs to be completed promptly and some scope for further guidance on principles for decision makers. Procedures once promulgated also

need to be kept under review and updated as necessary.

15.25 I recommend

examination of the most appropriate legislative mechanism to cover ASIO financial administration, with recognition of the Director-General as responsible under s.2AB of the Audit Act 293.

"

"

1901 if ASIO is to continue to be treated as a Department under that Act;

examination by central co-ordinating agencies in Canberra, in consultation with Attorney-General's Department and ASIO, of appropriate arrangements to determine and bring to notice those general financial and administrative instructions to which ASIO is expected to conform (this may need to be

subsumed in a wider study applicable to statuto ry

authorities generally);

that ASIO give priority to finalising outstanding action on the recommendations of the 1978 Review of Accounting Records and Procedures, particularly the completion Administrative Officers Procedures Manual;

of the

that ASIO seek to provide in its financial instructions more direction to assist decision makers make appropriate and consistent decisions;

that financial instructions be kept under review and updated when necessary.

AUDITING OF ASIO

15.26 The terms of reference ((a) (v)) require me to consider effective oversight by the 'whether existing Auditor-General of law enables

the Australian

Organization . " " in financial matters'. Security Intelligence

15.27 The Australian Labor Party submission expressed the view that:

there should be provision for proper financia l

accountability of ASIO, including the auditing of all its accounts by the Auditor-General or a current member of his staff. In those limited areas of extreme operational sensitivity where preservation of complete secrecy is necessary, accounts should nevertheless be audited by a seconded career member of the Auditor-General's office whose report would go only to the Director-General and to the Minister.

294.

15.28 These questions

relevant to the broader relation to Ministerial Parliamentary oversight

of external audit accountability are accountability questions I discuss in control (Chapter 16) and particularly (Chapter 17). Both internal audit

arrangements and reports and external audit reports are relevant to the question of financial administration. For convenience, I

deal here with all aspects of auditing of ASIO.

External audit 15.29

by

Since its establishment, ASIO has been subject to audit the Auditor-General. Initially, by administrative arrangement, the Auditor-General did not audit ASIO's sensitive operational account but relied on annual certificates from the Director-General of Security and

the amount expended from the No.

the Prime Minister declaring 2 Account (the special bank

account used for funding sensitive operational expenditure) and that the expenditure was properly made.

15.30 Following RCIS, the Government introduced an amendment to

the Audit Act 1901 to provide in s. 700 for the responsible

Minister to declare all or part of the accounts of a department or organisation as exempt accounts where the Minister is satisfied that disclosure " " " would prejudice operations " " " and " " " would be contrary to the national interest'. The then

Attorney-General issued a declaration on 29 June 1979 making exempt 'the accounts of

directly related to the accounts related to

(ASIO) known as the No. 2 Account and

obtaining of intelligence (excluding staff and general administrative

expenditure) in respect of the f inane ial year that commenced on 1 July 1978, and all subsequent financial years'. This action

regularised the previous administrative arrangement.

15.31 As required by s. 700, the Auditor-General has notified

the Attorney-General (as the responsible Minister) shortly after each financial year of 'the total of the amounts allocated for crediting to the exempt (No. 2) accounts', and the

Attorney-General has duly issued certificates to the

295.

∑ '

'c

Auditor-General, for presentation to the Parliament, certifying:

{a) that the moneys shown in those exempt accounts as havin ´<:

been expended for a purpose or service specified in those exempt accounts during that financial year were properl 2 expended in respect of that service or purpose and in the public interest; and

(b) that the amount standing to the credit of those exemp t accounts at the end of that financial year -

(i) was held partly in cash and partly on deposit with a bank; and

( i i) equalled the amount ascertained by aggregating the

amount standing to the credit of those exemp t , accounts at the commencement of that financial year: and the total specified in the (Auditor-General 1 s) notification and subtracting from that aggregat e the total of the moneys referred to in

paragraph (a).

15.32 ASIO has established a practice whereby the

Attorney-General is supported in the giving of that certificate by a certificate in similar terms provided to him by the Director-General, who has in turn received a certificate from the ASIO Internal Auditor that the amount was properly expended and a proper charge to the account.

15. 33 I propose that, in addition to the terms of the cur rent certificate, the Act should require the Minister to certify whether the exempt account has been audited by an interna l auditor, whether any shortcomings or queries have been raised and whether all such shortcomings or queries raised in the internal auditor 1 s report have been rectified or followed up. The Attorney-General and the Director-General would no doubt

wish the supporting certificates (15.32) also to include this additional assurance. 296.

15.34 Although in RCIS I accepted that some transactions by ASIO were so∑ sensitive that they should not be subject to

external audit, I indicated that more transactions seemed to be entered against the No. 2 Account than were justified by their particular sensitivity or by the current Financial Directive.

'The Government accepted my recommendation that the transactions

appropriate to the No. 2 Account should be more clearly defined.

Guidelines have been developed restricting the expenditures

chargeable to the No. 2 Account with the result that the such

expenditure now forms less than 2% of the ASIO appropriation, compared to over 6% in 1976-77. The exempt figures are included

in estimates and reporting of expenditure to Finance, SCIS and

Ministers.

15. 35 An examination of relevant ASIO files revealed no record

of written queries from the Auditor-General prior to 1982. The

Chief Auditor for Victoria, whose office has the responsibility

for auditing ASIO accounts in accordance with a program

developed by the Central Office, has confirmed that prior to

1982 audit queries had been pursued and resolved orally with

ASIO officers. Audit queries were raised in writing with ASIO in

1982, 1983 and 1984.

15.36 The Chief Auditor for Victoria has expressed the view that, although shortcomings in internal audit arrang emen ts (see

15.37 and 15.41-15.47) were a matter for concern, the queries raised with ASIO have not otherwise been exceptional and that matters raised with ASIO following external audits have been similar to those for other departments. He sees ASIO as having

made a reasonable effort to implement the recomm endations of the

1978 Review of Accounting Records and Procedures.

15.37 In its Annual Report 1982-83 (paragraph 69 in the

published verslon), ASIO stated that 'the Aud itor-Ge neral' s Office raised no queries in its examination of ASIO accounts and no criticism was levelled at ASIO in the Aud itor-General' s

report. " Whilst it is true that the Au dit or-Gene ral did not

297.

∑ '

~∑ ' I

" <

criticise ASIO in his 1982/3 report and indicated results as 'generally satisfactory', the claim that the Auditor-General's office raised no queries does not accord with the position revealed on ASIO files. ASIO concedes that the statement 'is, strictly speaking incorrect'. It has not been able to provide a satisfactory explanation. The error was not insignificant; it should not have been made.

15.38 In his 1983/84 annual report, the Auditor-General made mention of his auditing of ASIO, and of the arrangements under s.70D of the Audit Act 1901 for the exempt accounts. The report then noted a number of shortcomings in relation to ASIO's financial operations including inadequate control over assets, weakness in preparation and acquittance of pay, and weakness in the creditors payment system. He also stated that:

It was noted that difficulties had been encountered in filling the position of internal auditor within the Organization and significant functions/systems had not been subject to recent internal auditor review.

15.39 In RCIS I suggested 'That the Auditor-General be invited to consider inclusion in his annual reports to Parliament of a reference to his audit of ASIO's accounts' (4:1, 784). In view of the public

Auditor-General reports.

interest, I has included am pleased to note that the

such a reference in his recent

15.40 The Auditor-General concluded in his submission that: 'The present legislative provisions provide an adequate basis for the audit of ASIO'. I continue to see difficulties in seeking to extend the Auditor-General's responsibility to cover the No. 2 Account. Subject to the modification suggested in 15.33 above, I do not propose any legislative change. The

importance of adequate internal audit is addressed below.

Internal Audit 15.41 In RCIS

appointment and I recommended powers of the

298.

that 'Arrangements for the internal auditor should be

improved'. Although ASIO has taken some action towards this end, it is clear from the Auditor-General's comment quoted above and from my inquiries that a satisfactory position has not yet been

reached in relation to appointment of an internal auditor.

15.42 Since RCIS, ASIO has prepared at least four documents addressing the responsibilities of the internal auditor:

(a) 'Directive to Internal Auditor', dated 21 August 1978. This

was addressed by the Director-General to the first internal

auditor. It listed his charter, role and duties and restricted these to the exempt transactions.

(b) 'Statement of

Internal Audit February 1980

Purpose, Authority and Responsibility for Function'. This document was prepared in by the internal auditor and endorsed by the

Director-General. It was prompted by proposals in Public. Service Board Circular 1979/8. It canvassed purpose, role, audit methods, organisational responsibility, reporting, liaison with Auditor-General's office, liaison and

relationship with operating management, and examination and certification of exempt expenditure statements. It extended the internal auditor's responsibility to cover all ASIO' s accounts, consistent with the recommendation of the 1978

review;

(c) An ASIO circular 'Internal Audit', dated 22 April 1981. This Circular advised Branch Heads and Regional Directors of the internal auditor's responsibilities for auditing all ASIO's accounts, and indicated that an internal audit program had

been approved for the years 1981, 1982 and 1983.

(d) Chapter 7 of Administrative Officers Procedures Manual (AOPM), Part 1 'Internal Audit', apparently produced in

July 1982.

299.

∑'

15.43 There is some lack of certainty among those concerned in ASIC as to which of the four documents is the definitive charter

for the internal auditor. ASIC, in a submission to me, attac hed documents (a) and (c) and made mention of (b). I think that the segment in document (d), the ACPM, should be clearly state d to be the definitive document. In fact, the introduction indicates that the Manual supersedes earlier circulars. This document (and the earlier documents once the broader role was recognised) seem to provide an adequate statement of the powers and

responsibilities of the internal auditor.

15.44 The ACPM Chapter 7 provides for the internal audito r to report initially to the Section or Branch Head or Regional Director responsible for the function reviewed and on receipt of a reply to prepare a summary covering findings, recommendations

and actions taken. The Manual also provides for the summary to be submitted to the Director-General, for the internal auditor to report any major weaknesses or losses immediately to the Director-General and for him to provide to the Director-General half-yearly summaries of his activities. The earlier docume nts describing the internal auditor " s role had similar requirements for regular reporting to the Director-General. There is no evidence on file that any such reporting has been undertaken, other than that in support of the annual certificat ion in relation to the exempt account. Action should be taken to ensure that the Director-General does receive regular reports from the internal auditor on his activities.

15.45 The ASIO files show that, since 1978 in the case of the exempt No . 2 Account and since 1981 in the case of the

non-exempt transactions, there has been a series of queries raised by the internal auditor. The queries have generally been addressed to the relevant Branch Head or Regional Director. They seem to have been given due consideration by those concerned, although it is not clear from the internal auditor's files that all queries have been resolved. The recently retired internal auditor does not see the queries raised by him as indicating any exceptiona l weaknesses.

300.

15.46 The internal auditor has prepared the necessary report each financial year to form the basis for the Director -Ge neral's certificate concerning the exempt No. 2 Account. There are signs that the internal auditor has made a useful contri bution to syste ms improvements. Otherwise, the patte rn of queries has been som ewhat irregular. This may be partly because some queries may

have been resolved orally, and perhaps because there has been only a limited number of shortcomings ~n ASIO 's financial operations. It also no doubt reflects the earlier restricted

coverage of the internal audit, the original part-time nature of

the appointment and the limited staffing of the internal audit posit ion in recent years.

15.47 It would be useful to require the internal auditor to furnish a copy of his report to the proposed Inspect or-General as well as to the Director-General.

Recruitment of internal auditor 15 .48 Apart from delay in extending the internal auditor 's role

to cover all accounts, ASIO might be seen to have given less

than full priority to ensuring adequate staffing of the position. The first internal auditor was appointed in 1978 on a

part time basis (2-3 days per week) and rem a ined so until his retirement in May 1982. Although the need for a full time

auditor was recognised, for one reason or another the position

has been inadequately staffed since that date .

15.49 ASIO has faced considerab le diffi culties in obtaining a suit able replacement. In May 1982 the Director -General discussed these difficu lties with the Auditor-General who agreed to assist in finding a replacement. Subsequently, ASIO advertised the

position but in March 1983 had still not found a suitable

applicant. In March 1983 there were further discussions with the Auditor-General's Office. On 23 March 1983 the Director-General

wrote to the Auditor-General asking him to provide an office r to act as interna l auditor for AS IO for a period of three years; the officer was to be regarde d as an ASIO emp loyee but under

301 .

secondment from the Auditor-General's office. On 25 March 1983 the Auditor-General responded agreeing that the provision by him of a suitable officer on temporary transfer for three. years might provide the best answer.

15.50 Further 10 October 1983

discussions followed, but it was not until that an officer from the Auditor-General's Victorian office was transferred to ASIO, with the expectation that he would retire when ASIO Head Office was re-located. In the meantime, the original part time auditor had been re-engaged on a part time basis from 1 March until 21 July 1983. The new auditor was absent on sick leave for two months during

February-April 1984 and from 8 October 1984 until his

retirement. There have been subsequent discussions with the Auditor-General's office and agreement reached that the officer currently undertaking the external audit might be transferred to ASIO to act as internal auditor until the re-location of Head

Off ice. He may not be able to take up the posit ion unt i 1 early 1985. In the 31 months since the need to recruit a replacement for the original auditor arose, there has been a part time occupant of the position for five months and a full time occupant for ten months.

15.51 It will be clear from what I have said that ASIO has made efforts to fill the vacancy. The Auditor-General's comment in his annual report (15.38) recognises the difficulties which ASIO had encountered. Nevertheless, it is of concern that ASIO's accounts, including those exempt from external audit, may not have been subject to adequate internal audit in recent years. I understand that since RCIS there have been no internal audits carried out at regional offices other than a visit to NSW and ACT in June 1981. In RCIS I noted the importance of ASIO having

an adequate internal control system, in the absence of close scrutiny by the Parliament or the Treasury. With the formal exemption of the No. 2 Account from external audit, the need for the Parliament and the public to be assured that high priority is given to ensuring adequate internal audit is axiomatic.

302.

15.52 The arrangement which ASIO has entered into with the Auditor-General for him to provide one of his staff on transfer to fill ASIO's internal auditor position is, I believe, a most desirable one. This will be particularly so if the

Auditor-General treats the posting as a secondment suitable for an able officer in terms of career development.

15.53 I suggested in RCIS that the officer responsible for audit of ASIO' s exempt accounts should be a person approved by the Auditor-General and desirably a former member of his staff. I would now go further and suggest that any concern at certain

ASIO accounts being exempt from external audit could be eased by

the internal auditor being an officer on secondment who, although owing his immediate loyalties to the Director-General of ASIO, and reporting direct to him, would also have a degree of independence arising out of his association with the Auditor-General's Office to which he would return after a fixed

period.

15.54 I understand that the arrangements officers from the Auditor-General's office to for posting of ASIO have been

based on the mobility provisions (Part IV) of the Public Service Act 1922. Under those provisions, an officer accepting

appointment to ASIO becomes an unattached officer and is deemed to be on leave of absence without pay~ he remains in this

situation generally for up to three years, although the Public Service Board can extend the term, and during this term he is entitled to return to the Auditor-General's Office at any time. After the term elapses, he ceases to be an officer of the Public Service (although there are some provisions under which he can

seek to return).

15.55 Transfer to ASIO under the mob ility provisions does not

fully meet my suggested requirement that the officer should have the expectation of return to the Auditor-General's Office to pursue his career after a certain period. It may be that a clear

understanding between the two agencies and the officer that his

30 3.

" '

".

appointment to ASIO is for a limited term, following which he will return to the Auditor-General's Office, would be an acceptable alternative to a fixed-term secondment. The ∑ general leave without pay provision (s.71 of the Public Service Act 1922) specifically excludes grant of leave to engage in employment to which Part IV applies, and thus does not permit a

ready alternative. The option of the Auditor-General simply making an officer available to ASIO, perhaps with salary recovery, may not be seen by ASIO as satisfactorily ensuring that the officer is responsible to the Director-General, and not the Auditor-General, during the time with ASIO.

15.56 I suggest that the Auditor-General's Office and ASIO should work out, in consultation with the Public Service Board, the most appropriate arrangements under which the

Auditor-General's Office could provide an officer to be ASIO's internal auditor, on the basis that the officer would be responsible to the Director~General of Security, but would be expecting to return to the Auditor-General's Office at the end of an agreed term.

Conclusions and recommendations 15.57 Subject to my suggestion that the exempt account

certificates should refer to internal auditing of that account, satisfactory arrangements appear to have been settled for the external auditing of ASIO's accounts, with strictly limited exemption of the operational accounts. I see merit in the Auditor-General giving some indication in his annual report, as

he has in recent years, of the ~xtent and outcome of auditing of ASIO.

15.58 Suitable guidelines appear to have been settled for ASIO's internal auditing but every effort needs to be made to ensure that an appropriate program is approved by the

Director-General and followed, and that there are regular reports to the Director-General; in particular, priority needs to be given to adequate staffing of the internal auditor

304.

position, this to be by secondment of an officer of the Auditor-General's Department under appropriate conditions.

15.59 I recommend that:

s.70D of the Audit Act 1901 should require the Minister to certify also whether the exempt account has been audited by an internal auditor, whether ∑ any shortcomings or queries have been raised and whether all such shortcomings or queries have been rectified or resolved; and

the internal auditor position be staffed by a secondee from the Auditor-General's Office, clearly responsible to the Director-General, but due to return to the Auditor-General's Office at the end of the secondment; ASIO and the

Auditor-General's Office should consult with the PSB to determine appropriate secondment arrangements.

the Director-General of Security determine and review regularly a program of internal audit covering all relevant aspects of ASIO's financial administration, and ensure that he receives regular reports on the internal auditors' progress and findings.

the internal auditor be required to furnish a copy of his reports to the proposed Inspector-General as well as to the Director-General.

305.

"''

CHAPTER 16

CONTROL AND ACCOUNTABILITY

Introduction 16.1 It is no easy task to devise an appropriate system for the control and oversight of an organisation such as ASIO.

16.2 A large measure of secrecy is essential for the effective performance of ASIO' s security intelligence functions. ASIO has to be able to protect sources and methods and, in some

circumstances, results of its operations. Personal information that ASIO may need to collect in the course of its work requires protection in the interests of the privacy of the individuals concerned.

16. 3 On the other hand, the Government, being responsible for ASIO, needs to know enough about its activities to satisfy

itself that ASIO is carrying out its functions effectively and properly. In a society such as ours, the public is entitled to assurance that ASIO is not exceeding its mandate or interfering improperly with individual rights and liberties.

16.4 Concern about the effectiveness of ministerial control and the potential of ASIO's activities to encroach on the rights and liberties of individuals leads to calls for independent investigation of ASIO. But it should be borne in mind that there can be too much oversight, just as there can be too little. There is a cost in oversight, both in resources required and in

distraction from the carrying out of its primary functions of the body which is subject to oversight. There is a need for a sense of proportion, and of what is practicable, in considering procedures for oversight or control.

16.5 The challenge is to strike the right balance between --: ASIO's requirements for secrecy and the need for supervision of

306.

its activities in the public interest; enables ASIO to get on with its job

to devise a system that while at the same time

ensuring that it does not get out of control.

16.6 I am satisfied that ASIO today is much more accountable in its operations than it was before RCIS, and that it is far more aware of its proper role. But there is room still for

strengthening of the system of control and accountability.

16.7 An appropriate balance has to be struck also between the ability of a government to exercise control over ASIO and the highly important principle that ASIO should be politically impartial. Australians of all political views would have reason

to fear and distrust an ASIO that carne to be used as a political tool by the Government of the day.

16.8 The present system of control and accountability hinges largely on the position of Director-General of Security, and the Director-General's relationship with the Attorney-General. (The Attorney-General is the minister to whom administration of the ASIO and its antecedent legislation has been allocated under the

Administrative Arrangements Orders in force since RCIS).

16.9 The Director-General of Security, under the ministerial oversight of the Attorney-General, is responsible for the control of ASIO. The Attorney-General in turn answers to the Parliament in respect of ASIO operations.

16.10 I discuss the roles of the Director-General and the Attorney-General in more detail below. I canvass also ways 1n which the Attorney-General's role in relation to ASIO could, and

in my view should, be supported and strengthened. The proposals I consider are directed also to providing a firmer basis from

which the Attorney-General can account to Parliament in respect

of ASIO.

307.

16.11 The greater support and strength

Attorney-General's role should also be of assistance of the

to ASIO.

First, it should provide a measure of guidance to the

Organization which it requires in the rapidly changing political, economic and social context in which it has to carry out its important work. Secondly it should help to diminish the fear that undoubtedly exists in some quarters that ASIO carries on activities which are outside its charter or which, although within its charter, are unreasonably intrusive upon private and democratic rights and are unknown to the Minister who is

responsible to the Parliament and to the public for what it does.

16.12 In the following chapter I discuss other aspects of accountability and procedures by which redress could be afforded to persons affected by actions of ASIO.

Director-General 16.13 The Act vests direct control of the Organization in the I Director-General (s.8(1)). His responsibility for the management of the Organization and the carrying out of its functions is of course subject to the limitation in the Act of ASIO's functions and powers. It is also subject to the power of the Minister -conferred and qualified by s.8(2) - to give general directions.

16.14 Regardless of any system of external controls or oversight, the effectiveness and reputation of ASIO hinges to a large degree on the personal qualities of its officers and above all of the Director-General. The position calls for a high degree of integrity together with professional competence and managerial ability.

16.15 I remain of the view expressed in RCIS (4:1 387} that the Director-General should not necessarily be a Judge∑ The appointment of Mr Justice Woodward as Director-General in 1975, and the changes brought about during his term of office, gave a much needed boost to ASIO's reputation and credibility. The

appointment of the then Deputy Director-General,

308.

Mr T.H. Barnett, as

in showing ASIO' s

Director-General in staff that the 1981 top

organization was open to be filled from within.

was important too position in the

16.16 I recommend that the field of possible candidates for future appointments to the position of Director-General should be wide enough to cover individuals of proven managerial

ability, not necessarily from a ∑ security or inte lligence background, as well as professional intelligence officers and judges, with high personal repute being a prerequisite in any case.

Attorney-General's role 16.17 ASIO

Commonwealth

is part of the executive government of the

and, subject to any legislation which otherwise provides, is subject to ministerial control. Section 8 ( 2) of the ASIO Act specifies limits on the extent of that ministerial

control.

16.18 The oversight of ASIO's activities in the public interest, and ASIO' s accountability through the Parliament to the public, depends on the effectiveness of this ministerial

control.

16.19 The relationship between the Attorney-General and ASIO has been largely conducted at a direct personal level between

the Attorney and the Director-General. I believe that the Attorneys-General who have held office since RCIS have taken their responsibility for ASIO seriously, have kept themselves generally informed of ASIO activities and have given close

attenti on to the matters that have called for their

consideration.

ASIO and the Prime Minister

16.20 I remain of the view that, while the Attorney-General is the appropriate Minister to have direct responsibility for ASIO, the Director-General should have a discretion to approach the

309.

Prime Minister direct in security matters of importance or delicacy that may affect the Government (RCIS 4:1 775). Where a matter arises on

particul ar as a who le

which the

Director-General feels the Prime Minister should be briefed, the appropriate course normally will be for him to approach the Prime Minister after consulting with the Attorney-General. But he should have a discretion, in very exceptional cases, to approach the Prime Minister without speaking to the

Attorney-General. The Prime Minister of course, having regard to his overall responsibilities, is free to seek briefings on security matters from the Director-General as he sees the need. The Director-General should normally keep the Attorney-General

informed of such briefings.

16.21 The relationship between the Director-General and the Prime Minister is not touched on in the ASIO Act and I think it is sufficient to leave it as a matter for judgment in accordance with convention. I recommend maintenance of the conventio n, discussed above, under which the Director-General may approach

the Prime Minister direct in appropriate cases.

Minister's power of direction 16.22 The question of the extent to which the Director-General should be subject to ministerial direction is a vexed one.

16.23 The present position is set out in s.8(2) of the ASIO Act:

8. (2) In the performance of his functions under this Act, the Director-General is subject to the general directio ns of the Minister, but the Minister is not empowered to override the opinion of the Director-General -

(a) on the question whether the collection of intelligence by the Organization concerning a particular individual would, or would not, be justified by reason of its relevance to security;

(b) on the question whether a communication of intel ligence concerning a particular individual would be for a purpose relevant to security; or

310.

(c) concerning the nature of the advice that should be given by the Organization to a Minister, Department or authority of the Commonwealth.

'That provision broadly follows recommendations I made in RCIS

(4:1 690-748), although paragraphs (a) and (b) have been limited

to protect the independence of the Director-General's opinions in relation only to intelligence 'concerning a particular individual'.

16.24 The nature and extent of ministerial control of ASIO has been the subject of a number of submissions to me expressing

views ranging from one that any fetter on the Attorney-General's

control should be removed, to the contrary view that the

provisions of s.8 should remain as they are. The issue is an

important one and needs to be considered again in the light of the submissions and material before me on the matter, and of the principles of ministerial responsibility.

16.25 My recommendations in RCIS were made upon the basis that

a balance needed to be struck between ministerial control of

ASIO and the provision of some safeguard against misuse of the

Organization for political purposes. This approach was justified by evidence relevant to both aspects of the problem.

16.26 The history of the debate concerning ministerial responsibility shows that for the greater part of the

Organization's history all political parties have supported a

balance of the kind I have indicated, that is, a general control

of the Organization by the Minister subject to safeguards to

prevent political misuse. The original directive for the

establishment of the Security Service signed by the Prime

Minister, Mr Chifley, on 16 March 1949 provided:

7. No inquiry is to be carried out on

department unless you are satisfied that an interest bearing on the defence of the defined in paragraph 5 is at stake.

311.

behalf of any

important public Commonwealth as

'You' was the Director-General of Security, and paragraph 5 listed matters now included in the definition of 'security' 1n s.4 of the ASIO Act. On 20 September 1949 the Attorney-General, Dr Evatt, affirmed that 'To all intents and purposes the Director-General of Security is free from Ministerial direction'. When the first ASIO Bill was introduced in 1956, the then Prime Minister, Mr Menzies, in his second reading speech, said:

The bill makes no attempt to specify the manner in which, or the degree to which, ministerial authority should be exercised in relation to the service. It is clearly impossible, and in any event undesirable, for a Minister to exercise in this field the same degree of supervision and authority that he exercises in his own department (House of Representatives, Hansard, 24 October 1956, p.l747) e

In his speech, Dr Evatt, then the Leader of the Opposition, said:

First of all there must be, in our op1n1on, Ministerial responsibility in relation to the Australian Security 1 Intelligence Organization " " " ! do not believe that the people of Australia would approve of an organisation like this 1 unless it were perfectly clear that there was, at any rate, a political officer responsible for it, in a general way, to ,1 the Parliament and the people. By that, I do not mean

responsible for the detailed working out of all the problems of the organization or anything of that kind " " "

We want ministerial responsibility in a general sense. I do not mean that we want detailed consideration of every particular activity of the organization, but there must be a supervisory Minister, responsible to the Parliament and to

the people " " " (House of Representatives, Hansard, 31 October 1956, pp. 2010, 2014).

16.27 When the present legislation was before Parliament in 1979, the Attorney-General, Senator Durack, described clause 8 as 'the very pivot of the Bill'. He said that the

Attorney-General:

should be able to give general directions and be able to obtain information from the Director-General about the way in which the Organization is run and about the intelligence that is collected.

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He went on to say that the:

inherent problem in the relationship is that a Minister may seek to obtain information about a particular individual and that this information may be used for a political purpose.

He gave this as the reason for the major qualifications on the

Attorney-General's power of direction in paragraphs ( 2) (a) and (2) (b) of clause 8 - which paragraphs he said 'will protect the

individual against misuse of ministerial power' (Hansard, Senate, 5 April 1979, pp. 1396,1397). For the then Opposition, Senator Evans agreed on the need for an explicit clause such as clause 8 directed to the nature and extent of ministerial

responsibility. He said:

" " " although we say that the power of the Minister should be maximised we do not say that his power and responsibility should be complete. We acknowledge the legitimacy of certain specific restrictions on the power of the Minister to

exercise complete authority over the Director-General. We have no quarrel with the language of clause 8 ( 2) (a) and (b) . . . . Senator Evans did however express opposition to clause 8(2) (c),

to which I refer below (Hansard, Senate, 5 April 1979, pp. 1390, 1391) "

16.28 The approach taken in most of these and other statements on the subject matter was that ASIO should be subject to control

by the Minister in a general way, but that he should not be

concerned with the details of particular activities. This approach is reflected in the provision in s.8(2) of the 1979 Act that the Director-General 'is subject to the general directions of the Minister'. It is perhaps analogous to the situation which exists in the United States where the Attorney-General issues general guidelines to the FBI which are to be observed by it in carrying out its investigations.

16.29 As well as providing for the giving of general directions by the Minister, the 1979 Act also provided for the exercise by

the Attorney-General of the power to issue warrants for various

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purposes. In exercising these powers the Minister is necessarily required to be concerned with the details of the particular matters in respect of which the warrants are sought.

Section 8(2) (a) and (b)

16.30 The submissions supporting full Ministerial oversight are directed particularly to s. 8 (2) (a) and (b). It is submitted that, if the Minister is to be truly responsible to the Parliament, he should have a power to give directions about the collection and communication of intelligence concerning

individuals, notwithstanding the Director-General's opinion.

16.31 An alternative submission 1s that if there is to be any limitation on the power of the Minister to give directions about the collection and communication of intelligence concerning individuals, the limitation should go only to preventing the Minister from overriding the Director-General's opinion as to

individuals concerning whom intelligence should be collected or communicated, and not as to persons concerning or to whom that intelligence should not be collected or communicated.

16. 3 2 I

submission consider that there is considerable validity in the that the responsibility of the Minister to the Parliament justifies him in having a concern about these matters. To prevent him altogether from overriding the opinion of the Director-General derogates from the Minister's ability fully to be responsible. Likewise, although his responsibility would usually be satisfied by giving general rather than ' particular directions, the Minister's inability to give a particular direction may also impose an inappropriate limitation on his ability to carry out his responsibility.

16.33 An illustration can be found in the evidence taken in relation to paragraph {c) of the terms of reference. When the question of Mr Ivanov's activities in Australia and of his relationship with Mr Combe was being discussed and considered by

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the National and International Security Committee, of which the Attorney-General was a member, the Director-General declined to give the Attorney-General the transcript of a conversation between Mr Ivanov and Mr Combe, although requested by the

Attorney-General to do so. I have already expressed my view that the Director-General was wrong in declining to comply with the request, which was a particular request to give to the Attorney-General intelligence in written form which the Director-General held concerning a matter which the

Director-General had felt it necessary to communicate to the Government for a purpose relevant to security. (See Report on 1

Term of Reference (c) , 32, 33).

16.34 Despite the strength of the submission that all fetters on the Minister's power to give direction should be removed, I

am satisfied that there remains and will always remain a need to

ensure by some means that the powers and resources of ASIO are not misused for political purposes. There was a deal of evidence to support this view before RCIS. The material before me in this inquiry shows that the position has significantly improved but that to some extent this improvement has been due to the

presence of s.8(2) in the Act.

16.35 Instances have arisen since RCIS in which

Directors-General have relied on s.8 in reacting to requests for action or information which they did not consider to be justified on security grounds and where the Attorney-General himself has relied on it in resisting pressure from other Parliamentarians to obtain information from ASIO. It is true, no doubt, that in the long run the integrity of the

Director-General is essential to the proper control of ASIO but simply to leave the matter on that basis would be a naive and unrealistic approach.

16~ 36 These considerations justify a review of the provisions

of s.B but still require a balance to be found between

Ministerial control and safeguards against misuse for political

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purposes. I have concluded that the problems can be resolved in a way which gives full recognition to ministerial control but at

the same time provides the necessary safeguards.

Section 8 (2) (c) 16.37 The rest ricti ons upon the Minister's control which I have

been discussing are tho$e which provide that his directio ns to the Director -Gene ral shall be general, and which limit his power to override the Director-General in relation to the collection and com mu nication of intelligence. Section 8 ( 2} (c) is direct ed to advice given by the Organization to a Minister, department or authority of the Commonwealth. The Minister may override the D irector-Gene ral as to whether such advice should or should not

be given at all, but he may not override the Director -General in respect of the nature of the advice.

16.38 One of the functions of ASIO conferred by s.l7 of the Act is to give advice to Ministers, the Commonwealth. By virtue of departments and authorities of

s~ 37 ( l) the furnishing by the

Organization of security assessments is treated as the giving of advice relevant to the functions and responsibilities of those Minister s , departments and authorities. Although submissions have been made that the Minister should be able to give

directions to the Director-General as to what advice he should give, I do not understand what is intended by those submissions.

16.39 If advice which the Director-General is authorised by the Act to give is sought on some appropriate matter, his advice is sought and given as an expert adviser on security. If the Attorney-General wishes to give his own advice on a parti cular matter, then he is free to do so, and other Ministers or

departments and authorities are free to ask him his opinion. If, however, it is the D irector-General's advice that is sought, I consider that it would be entirely inappropriate that he should be subject to direction by the Attorney-General as to what advice he should give. If the Director-General received and

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complied with such personally agreeing advice at all.

a direction

in the advice, and gave advice without

he would not be giving his

16.40 Under the present section, it would be possible for the Attorney-General to direct that the Director-General should not give advice sought by a Minister, department or authority, and for the Attorney to give that Minister, department or authority

his own advice. It would also be possible for the Minister to direct the Director-General to give advice to a Minister, department or authority on a particular subject-matter but not to tell him what his advice should be. To remove s. 8 (2) (c) from

the Act would not enhance ministerial responsibility or enable the Minister to carry out his responsibility in any appropriate way. It could lead to ministerial advice being substituted for the expert advice which had been sought.

16.41 The obvious problem created by allowing the Minister a power to direct the nature of the advice which should be given by the Director-General is exacerbated in respect of security

assessments. A whole Part of the Act is directed to the giving of those assessments, and a system of appeal to a Security Appeals Tribunal is provided to review any adverse or qualified assessment given by ASIO. It would be completely inconsistent

both with the spirit and the letter of the Act in relation to security assessments by the Minister as should give.

that ASIO should be subject to directions to the nature of the assessments that it

16.42 When the present legislation was before Parliament 1n 1979, the then Opposition opposed clause 8 ( 2) (c) on the view that it would provide a roundabout way of enabling the

Director-General to withhold specific intelligence from the Attorney-General. This view apparently rested on a construction that pa:ragraph (c) would preclude not only a direction on the substance of advice to be given, but also a direction on the

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communication of intelligence as distinct from the provision of advice. Again, the Australian Labor Party's submission to this Commission referred to s. 8 ( 2) (c) as:

" " " an unnecessary limitation on the general power, authority and responsibility of the Minister. It effectively prevents the Organization from being required to communicate specific intelligence not just to other Ministers but to the Minister administering the Act. This could be used by the

Director-General to withhold specific information, not just about particular individuals, but about the whole range of matters which might be covered by the Director-General's advice.

16.43 Paragraph (c) stems from a recommendation in RCIS which was not intended to have the effect that is apprehended. Having

regard to the separate treatment in s.l7 of the functions of communicating security intelligence and advising on security matters, and to the fact that s. 8 ( 2) (b) deals with directions in relation to the communication of intelligence, I do not believe that, on its proper construction, it has that effect. In my view, the reference in paragraph (c) to the nature of the advice

is to the content of the advice only and does not impinge on communication of information to any Minister, let alone to the Minister responsible for ASIO. If this view is not accepted, section 8 could be amended to make it explicit that paragraph

( 2) (c) does not derogate from the Attorney-General's right, as

Minister administering the Act, to obtain from ASIO any information that he requires.

16.44 Accordingly, in any re-organisation of s.8 in relation to Ministerial control, there should be retained a provision that the Minister may not give directions to the Director-General as to the nature of any advice he may give to any Minister,

department or authority of the Commonwealth, including advice contained in any security assessment.

16.4 5 Apart from the retention of such a concluded that what needs to be sought is

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provision, I a mechanism have that

recognises the paramountcy of ministerial control but has built into it safeguards to inhibit and bring to light any misuse of that control.

16.46 I recommend that s.B be amended:

(a) to delete from ss. (2) the word 'general' which presently

qualifies the directions that ∑the Minister may give. (The effect of the present 1 imitation is not clear and I favour an unfettered power of direction as the starting point);

(b) to enable the Director-General to require that any direction given to him be put in writing;

(c) to provide that the Minister cannot override the opinion of

the Director-General on the question of whether the collection, or communication, of intelligence concerning a particular individual is justified on security grounds otherwise than by a direction in writing which sets out the Minister's reasons;

(d) to require copies of any such direction referred to in (c) to be given to the Inspector-General (a new office I propose below (see 16.76 et seq.)) and to the Prime Minister, and to require the Attorney-General, in reporting to Parliament each year on the Inspector-General's activities in,relation

to ASIO, to include any comments made about such a direction by the Inspector-General;

(e) to require the Director-General to retain a wr itten log of any intelligence collected, or communicated, pursuant to a direction referred to in (c);

(f) if the view is taken that s.8(2) (c) is open to a contrary interpretation to that given in 16.43, to provide explicitly

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that s.8(2) (c) does not derogate from the Attorney-General's right, as Minister administering the Act, to obtain from ASIO any information that he requires.

I recommend also that a provision to the effect of s. 8 (2) (c)

which precludes the Minister from directing the Director-General on the nature of advice which he should give, including advice contained in any security assessment - should be retained.

16.47 A provision in the form I have recommended will recognise that the Minister's power over ASIO is ultimately paramount. I have concluded that it is appropriate that this be so; that the elected office-holder accountable for ASIO and its activities to Parliament and the public should in the end be able to determine - and assume responsibility for - activities pertaining to the security of Australia.

16.48 While the Director-General's opinions on matters of security, based as they should be on professional judgment, must carry great weight, I do not believe that they need to be treated in the same way as the quasi-judicial pronouncements of certain statutory bodies which are put beyond ministerial

intervention. I mention that the recent Canadian legislation enables the Minister to issue written directions to the Canadian Security Intelligence Service on any matters . relating to it, with copies to be provided to the Review Committee set up under

the legislation.

16.49 The safeguard in my proposal lies in the deliberate and formal process required where the Minister determines that his wishes should prevail even where the Director-General is not persuaded on security grounds that the course proposed by the Minister should be followed. The Minister's action - and any

subsequent use by him of intelligence obtained from ASIO - will stand to be judged by the Prime Minister and the

Inspector-General and, in due course, by the Leader of the

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Opposition ( who, I propose, should receive a copy of the annual report of the Inspector-General) and the Parliament.

16. 50 The changes in s. 8 of the Act which I have recommended

will bring about an important shift in the legal basis of the relationship between the Attorney-General and the

Director-General. They will enable the Attorney-General to give particular as well a.s general directions. I believe, however, that the Attorney-General will generally be well advised not to concern himself with specific details of ASIO's operations, but

to allow ASIO room to pursue its activities on the basis of its own professional judgment and within the framework of the

legislation and general guidance from the Attorney-General.

Attorney-General's guidelines 16.51 There is, in my view, a strong case for the

Attorney-General to play a positive role in laying down general directions or guidelines to govern ASIO's conduct in particular areas. Within the framework of the legislation there will inevitably be areas of broad discretion and judgment where the setting by the responsible Minister from time to time of standards will be proper and appropriate. (I refer to areas of this kind throughout this report). The performance of that function would give substance to the notion of ministerial control and responsibility and provide valuable guidance to ASIO.

16.52 I recommend that there should be clear provision in the Act enabling the Attorney-General to lay down guidelines governing ASIO's activities in particular areas.

(a) The guidelines should have the status of administrative

directions, confined in ambit, of course, by the boundaries set by the Act. They would not be designed to confer legal rights or impose obligations.

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(b) The guidelines should be 'binding' on ASIO in the sense that any action in breach of them would be in breach of a lawful ministerial direction, and the person or persons responsible _f_o_r __ t_h_e __ b_r_e_a_c_h __ w_o_u_l_d __ b_e __ a_c_c_o_u_n_t_a_b_l_e adm in is tr at i ve ly. (It

would be for the

Inspector-General, to guidelines) "

Attorney-General, aided by the hold ASIO to account under the

{c) Guidelines should normally be tabled in Parliament by the

Attorney-General and, in any case where for security or other cogent reasons they are not, a copy should be made available to the Leader of the Opposition.

16.53 While the formulation of guidelines would be a matter for the Attorney-General, aided as appropriate by his department, I would expect the drafting of the guidelines generally to be done in consultation with ASIO.

Minister's access to information 16.54 A particular issue that has attracted attention is the Attorney-General's right of access to information held by ASIO. I have already touched on this question in dealing with s.8 and

the Attorney-General's power to give directions. In my Report on Term of Reference {c) (paragraph 3.6), I commented on an

instance where the Director-General had misconstrued statements in RCIS in resisting a request by the Attorney-General to see the transcripts of a telephone intercept. I pointed out that there was no bar on the communication of intelligence to the Minister for a purpose relevant to security.

16. 55 Th e former Attorney-General announced in February 19 84, in the context of arrangements made with ASIO in the light of that report, that it had been agreed that he should be entitled to have full access to files and related specific material in circumstances where he becomes aware that a particular matter is of security concern and requires his attention, advice or direction. I agree with that approach.

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16.56 I have considered whether s.l7 which authorizes ASIO to advise Ministers in respect of certain matters relating to security, restricts the ability of the Attorney-General to obtain from ASIO information needed by him in his role of

Minister responsible for ASIO. That section enables the information to be passed to the Attorney-General where it goes to a matter 'relating to security' and is relevant to the Attorney-General's functions and responsibilities within

s.l7(c). Moreover, the changes in s.8 which I have proposed will have the effect of enabling the Attorney-General to insist on gaining access to particular intelligence provided that he is prepared formally to substantiate his demand and have it

recorded.

16.57 It does not seem to me that s.l7 or any other provision precludes the Minister from obtaining from ASIO information that does not relate to security, e.g. information concerning internal administrative matters. If a contrary view is taken, I

would see a need for an amendment to ensure that the

Attorney-General can inform himself fully on any matter relevant to his ministerial responsibility for ASIO.

16.58 As a precautionary measure, I recommend that ASIO should be required to keep a record of every instance where the

Attorney-General, or any other Minister, is given access to a file or other raw intelligence.

Minister's knowledge of ASIO 16.59 The Attorney-General is kept informed of ASIO' s

activities through:

ASIO's Annual Report;

regular fortnightly briefing reports provided to the Attorney-General and the Prime Minister under administrative arrangements re-instituted since I reported on Term of Reference (c);

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ASIO's justification and explanation of its financial bids in the annual budgetary process;

his consideration of written applications for warrants for telephonic interception or for the exercise of other special statutory powers - these applications provide an important window into actual operations and give the Attorney a

discretion as to how they are carried out;

other oral or written briefings from the Director-General or other officers of ASIO;

visits to ASIO Head Office or, on occasion, regional office s for broader briefings and discussions.

These means serve to provide the Attorney-General with a good deal of information and they provide the basis for the

significant degree of ministerial control which has been exercised.

16.60 It is not surprising, however, that the extreme pressures on the Attorney-General's time limit the scope for meetings with the Director-General and other officers, or for personal inquiry into or pursuit of particular issues and allegations. The pressure on the Attorney-General will grow if; along lines I am recommending, he assumes a greater role in the laying down of directions and guidelines, and if ASIO resorts more readily to

its Minister for assistance in clarifying or resolving policy or other issues. For these reasons, I consider that steps should be taken to provide greater support for the Attorney-General in the exercise of his ministerial control. These steps will also help to reassure Parliament and the public of the reality of that control.

16.61 I see this added support being provided through:

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I

I

the Attorney-General's Department becoming involved in security matters to a greater extent than previously. This should provide a stronger administrative basis for the exercise by the Attorney-General of his powers; and

the establishment of an office of Inspector-General with power to conduct inquiries into ASIO and to report to the Attorney-General on his findings.

16.62 I emphasise that these proposals, which are elaborated below, are designed to support and strengthen the exercise of ministerial control of ASIO. They are not seen as supplanting or frustrating that control.

Departmental support for Attorney-General

16.63 The Attorney-General's relationship with ASIO has in the past been very much a direct personal one, largely with the Director-General. Warrant applications have been delivered to

the Attorney-General and he has dealt with them without advice from anyone outside ASIO. Information and briefings of other

kinds have generally been provided direct to the

Attorney-General. The activity of the Attorney-General's Department in supporting its Minister in his dealings with ASIO and security issues pertaining to it has been 1 imi ted (although

there has been some recent expansion of this aspect of the Department's work).

16.64 The direct nature of the relationship, and the personal attention that Attorneys-General have given ASIO are important and should be preserved as far as possible. But this does not rule out a greater role for the Attorney-General's Department in support of its Minister. I see scope for a still greater

involvement of departmental officers to assist the Attorney-General in discharging his important responsibility of supervising ASIO. Such an expansion of the Department's role should help to bridge the gap that can develop between a

325.

security service, with its operational focus, and the expectations and sensitivities of those who are more concerned with the development and application of policy in the broader environment of government.

16.65 While the level of assistance provided by the Department to the Attorney-General has varied from time to time, the following forms of assistance have been commonly provided:

" advice on the development of new policies;

amendments to the law in the security area;

"

"

advice in consultation with ASIO on responses when the activities of the Organization attract political or public attention, including briefings for debate and possible parliamentary questions; handling correspondence to the Attorney-General concerni ng ASIO and ensuring that he is fully briefed before draft

replies are presented for his consideration; and liaison with other areas of government on policy associated with security matters, and co-ordination of such matters with ASIO.

16.66 ASIO has a lawyer in a 'Legal Adviser' position on its own staff, and until recently ASIO rarely looked to the

Attorney-General's Department for legal advice. Howeve r, in recent times the legal work performed by the Department for ASIO, in consultation with ASIO' s Legal Adviser, has increased

significantly.

16.67 The assistance given by the Department has tended to be at the level of broad policy, or advice on handling of issues that have attracted publicity. The Department has,

understandably, been less disposed to give advice which bears more closely on the operations of ASIO.

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16.68 ASIO for its part has been sensitive to its direct relationship with the Attorney and has not sought to draw his Department more closely into the relationship.

16.69 As a result of consultations involving the Prime Minister, the Attorney-General and the Director General following my Report on Term of Reference (c), a series of administrative arrangements, including a system of more regular

oral and written briefings, was established to improve consultation and communications between the Attorney-General, the relevant section of his Department and ASIO. These included the revival of regular fortnightly briefing reports. A useful

start has thus been made in building closer working relations between the Attorney, his Department and ASIO.

16.70 I have been struck by the active role that Departments play in other countries, particularly Canada and the United States, in assisting the office-holder who carries the political responsibility for domestic security. The Department can play a constructive role, providing the Minister with detached advice

on security matters and helping the security organisation in its

links with the machinery of government.

16.71 It is open to the Attorney-General to seek advice where he will on issues that arise for his consideration in relation

to ASIO. It is not inappropriate for him to look to his

Department for that advice in the same way that he can get

advice from his Department on other matters within his portfolio.

16.72 I consider that the Attorney-General would be assisted if he were to have available to him another perspective on matters

that are put to him by ASIO. In the case of warrants for

telephonic interception, for example, it imposes a heavy burden on a busy Minister to consider the case that is put before him

without having any opportunity to obtain independent advice. I understand that at least once recently the Attorney has looked to his Department for advice on a warrant application. I see it

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as a sensible practice for an Attorney-General to obtain comments and any advice from his Department on most, if not all, such applications.

16.7 3 There will be other occasions too where the Department could usefully provide the Attorney with advice on legal or security policy implications of ASIO operations or briefings. Moreover if, as I recommend, the Attorney-General becomes more

actively involved in the formulation of guidelines to assist ASIO in various aspects of its activities, there will clearly be more scope for the Department to lend assistance. It may be appropriate too for the guidelines on certain activities to require reporting of operations to the Attorney. The Department could then assist in the monitoring of such reports.

16.74 Security considerations and common sense dictate that any close involvement by the Department in security matters should be confined to a small number of carefully chosen officers.

16.75 _I ___ r_e_c __ o_m_m_e_n_d ____ t~h~a~t ___ t __ h~e ___ A_t_t_o __ r_n_e~y_-_G_e_n_e_r_a __ l ___ l_o_o_k ____ t_o ___ h __ i_s Department, along the lines discussed above, for additional .;;;s....;.u;.,.p_..p_o_r_t ____ i_n ____ h_i_s __ ~o....;,v.....;e.....;r~s:.....:l:;... g._h:..:....:.t ___ o:;..f::....__....;,A..:..:S~I~O " Cons is tent 1 y with my

recommendation for an expansion of the role of the Department I recommend in the General Report that the Secretary to the Department should be added to the Secretaries Committee on Intelligence and Security.

New office of Inspector-General

16.76 Even if his Department's role is enhanced, the

Attorney-General will still have to rely to a very large extent on the Director-General for his knowledge of ASIO and its activities. That reliance will also occur when the Attorney is formulating a response to complaints that may come to his notice. Such reliance is to be expected and it is desirable that the Attorney's relationship with the Director-General should be such that he can be confident that he is being adequately and accurately briefed.

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16.77 Having regard to the nature of ASIO's functions, the public concern to which those functions can give rise , and the secrecy pertaining to them, there is strong pressure on the Attorney, as the responsible Minister, to satis fy himself that

ASIO conducts itself in a proper fashion. Ho wever dilige nt the

Attorney may be, there are practical limits on his abili ty to investigate and satisfy himself that ASIO is at all times acting properly or appropriately. At the∑ very least , full inquiry

requires time which a Minister cannot be expected regularly to spare to examine materials and to interrogate people.

16.78 Moreover, apart from the procedures for review of

security assessments by the Security Appeals Tribunal, ASIO, unlike departments and many other agencies, is not subject to

provisions for external review of its adm inistrat ive acti ons. In particular (and for reasons which I fully understa nd) , the Ombudsman does not have jurisdiction in respect of AS IO, and

documents held by ASIO are not subject to the Freedom of

Information Act 1982. Decisions by ASIO are not subject to review by the Administrative Appeals Tribunal o r by the Federal Court under the Administrative Decisions (Judicial Re view) Ac t 1977. The Attorney, therefore, does not have the assurance that

is provided where a body for which he is responsible is subject to the ongoing discipline of independent externa l review.

16.79 I have carefully considered proposals for creating a new independent office charged with the task of inquiring into and monitoring the activities of ASIO, with em phasis on ASIO's compliance with the law and the general propriety of its conduct.

16.80 The subm ission made by the Australia n Labor Party, in particular, argued for a Security Co mm issioner who would be independent of the Government, Par 1 iame nt and the agencies and would be a combination of ombudsm an, auditor and inspector .

16.81 Although I have proposed earli er that the

Attorney-General's Department should play a more active role in

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support of its Minister, I do not consider it feasible or appropriate for the Department to play a detailed and continuing investigative and inspectorial role. would be useful for a position to

proposed.

I have concluded that it

be created of the kind

16.82 The critical question, as I see it, is how the functions of such a person would be co-ordinated with the existing

relationships between the Director-General, the

Attorney-General, Parliament and the public, and also with the present role of the Auditor-General.

16.83 I strongly believe that it would be a mistake to

interpose an additional officer in such a way as to interfere with or blur the essential line of responsibility from the Director-General to the Attorney-General and through him to Parliament. The executive responsibility for decisions in relation to domestic security rests with the Attorney-General and, within statutory limits, the Director -General. In my view that is where it should stay. The creation of a new position with power to second guess or take over managerial or

administrative decisions would confuse the issue of responsibility and could lead to 'buck-passing' among those concerned.

16.84 What is needed is an independent person with power to maintain a close scrutiny of ASIO " s performance of its

functions, and to look into complaints, in order to give greater assurance to the Attorney-General, and through him Parliament and the public, that ASIO is acting with propriety and within

its charter.

16.85 My own preference for the title of such an off ice 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'). I believe the title 'Inspector-General' is more descriptive of the

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intended role of the office and is less likely to connote ~ executive responsibilities then the title

1

Security

~ c ommissioner'.

16.86 Plainly great care would have to be taken to find the

right person to fill the mind and a capacity

prerequisites. Experience advantage, as would some

position. Integrity, independence of for rigorous inquiry are obvious in public . administration would be an previous acquaintance with relevant

areas. But prior employment in, or a very close association with, security or intelligence agencies would generally not be appropriate. I also feel that it would generally not be appropriate that the Inspector-General be a judge.

16.87 It is highly desirable that any person appointed as

Inspector-General should enjoy wide support in the Parliament. To that end, the appointment is one on which there should be

consultation before it is made between the Prime Minister and the Leader of the Opposition, as is required now for the

position of Director-General of Security.

16.88 The position should be established by legislation and, to enhance its independence, there would be merit in it being attached, for administrative purposes, to the portfolio of the Prime Minister. (There are further reasons for it to be so attached if, as I recommend elsewhere, the position is a broader one of Inspector-General of Security and Intelligence).

16.89 The Inspector-General should have security of tenure, but not for so long a term as might give rise to any feeling that he had, through familiarity, become too close to those whom he is charged to inspect. I consider that a three or four year term, capable of being renewed once only, would be appropriate. Provision could be made for appointment on either a full-time or part-time basis. My own belief is that a full-time commitment

wou ld be required.

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..

16.90 While the office, as I see it, would be a personal rathez than an institutional one, I see a need for a small staff tee assist the Inspector-General. The Inspector-General should have full access to files and other materials held by ASIO and the power to require answers to questions from its officers.

16.91 The Inspector-General should be empowered in relation t ~ ASIO to inquire into:

"

its compliance with the law;

the propriety of its actions in more general terms; and

the appropriateness and ef feet i veness of its procedures. interna L ,

He should be able to act on his own initiative, at the request ..

of the Attorney-General or in response to a complaint from any c person. While financial matters would be within the range of his inquiry the Inspector-General should be required to have regard to the role of the Auditor-General; appropriate matters coming to his notice could be referred for attention to the '

Auditor-General.

16.92 I am firmly of the view that the Inspector-General should report his findings to the Attorney-General. This is consistent with the aim of strengthening the Attorney-General's control over, and ability to account for, ASIO. The report should

include any recommendations for change in the rules or

guidelines governing ASIO, or its practices, or for action to be taken, or redress given, in consequence of any improper activity.

16.9 3 While the Inspector-General should report to the Attorney-General, it 1s important that his work should not be too remote from, or cut unnecessarily across, the

Director-General's own relationship with, and responsibility to, the Attorney-General. For this reason, it would be sensible to

332.

r:equire the Inspector-General to inform the Director-General o f ~ articular matters which he has under investigation, and to give

tthe Director-General, and any other ASIO officers who may be

a ffected, an opportunity to be heard and to make submissions

b efore a report is made that is critical of ASIO or any of its

o fficers. It would also be sensible for the Inspector-General to

ass to the

r.upon that

w ropos al s,

Attorney-General with his report, any comments made report by the Director-General, including his if any, for remedial action in response to the report.

J.6. 9 4 In my earlier

A ttorney-General and discussion of the relationship of the the Director-General, I proposed that

:certain directions given

IDirector-General should be

:Inspector-General. Where the

by

.:report on the propriety or ~ di rection, the appropriate

the Attorney-General subject to scrutiny Inspector-General saw a some other aspect of

course would be

∑ :Inspector -General to provide a copy of his report to !Minister.

to the

by the

need to

such a

for the

the Prime

16.95 In addition to making particular reports from time to

time, the Inspector-General should be required to report annually to the Attorney-General on his discharge of his duties

∑ of inspecting ASIO and dealing with complaints. The annual

report should include a reference to any particular reports made

to the Attorney-General during the year including any reports on

directions given by the Attorney-General to the Director-General .

16.96 A copy of the annual report should be given to the Leader of the Opposition, just as ASIO's annual report is at present.

16.97 An objection to any requirement that the report should also be tabled in parliament is that the Inspector-General would be inhibited in what he could write by reasons of security and

privacy. I think it better that the Attorney-General should be required to arrange for the tabling in Parliament of as much of the report as possible in one form or other. Alternative foLms

3 33.

would include one setting out the substance of the report in a report to Parliament in the Attorney's own name, and an expurgated version of the Inspector-General's report itself. I see the latter as a preferable alternative. As indicated earlier

(16.46(d)), the requirement to table a report should specifically require that it include any comments by the Inspector-General on Attorney-General.

a direction given to ASIO by the

16.98 The records of the Inspector-General should be exempted from the operation of the Freedom of Information Act 1982 in the same way, and for the same reasons, as are ASIO's records.

16.99 I mention that I have had regard to the role of the

Inspectors-General who are a well-established feature of many departments and agencies, including security and intelligence agencies, in the United States. As far as my inquiries have shown, those Inspectors-General have an important role within their agencies to look into questions of propriety, including financial aspects, and other aspects of performance. But they appear to be designed primarily to work internally to provide the executive head of each agency with 'eyes and ears', removed from regular line management, to what is happening in the agency.

16.100 The office which I propose would be somewhat similar in functions but would report to the Minister responsible for ASIO, rather than the Director-General as executive head. As I propose elsewhere, the holder of such an office might have

responsibilities extending beyond the one agency.

16.101 I note that the recently enacted Canadian Security Intelligence Service Act, which provides for the establishment of a new service by that name, provides (s. 30) for appointment of an Insrector-General whose functions are:

(a) to monitor compliance by the Service with its operational policies;

334.

(b) to review the operational activities of the Service, and

(c) to submit certificates, in relation to regular reports by the Director of the Service to the Minister with respect to operational activities, about the lawfulness and propriety of those activities.

The Canadian Inspector-General is tQ play a similar role to that which I contemplate for his counterpart in this country, but I do not propose, as the Canadian Act does, that the

Inspector-General report to the Secretary (Deputy Minister in Canada) of the Minister's Department.

16.102 I recommend that a position of Inspector-General be established by legislation with functions and powers, and provisions relating to appointment and reports, as proposed in 16.85 - 16.98.

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CHAPTER 17

EXTERNAL ACCOUNTABILITY AND REDRESS

Parliamentary oversight 17.1 There have been calls publicly and in submissions to me for greater accountability of ASIO to the Parliament, annual reporting requirements and, in particular, setting up of a Parliamentary committee to oversee ASIO.

including for the

17.2 Parliament is not responsible for the carrying out of the security intelligence functions with which ASIO is charged. That is the responsibility of the Government, exercised by the Attorney-General and, as prescribed by the ASIO Act, the

Director-General.

17.3 However, Parliament is entitled to hold the Government to account for the exercise of those functions as it is for the exercise of other executive functions. Parliament has an interest in ASIO as it appropriates the monies required by the Government for ASIO's purposes. It has a more general interest,

too, in the effectiveness, lawfulness and propriety of the way in which ASIO performs its role as well as in the adequacy of the legislation under which ASIO operates.

17.4 The Government is, of course, already accountable to Parliament, through the Attorney-General, in respect of ASIO. The Attorney-General has to be prepared to answer in the

Parliament for any aspect of ASIO or its operations that may become a matter of public concern.

17.5 In practical terms, the lack of publicity for most of ASIO's activities may parliamentary attention. security often limit the

restrict the issues that attract In addition, the requirements of information which can be provided by

336.

the Government to Parliament in respect of issues which do attract its attention.

17.6 In RC IS ( 4 : 1 , 4 6 0) , I r e fer red to the p r act ice of the

Prime Minister or the Attorney-General in relation to parliamentary questions concerning ASIO of not commenting, that is of neither confirming nor denying any allegations or presumed allegations. I expressed the view that the practice should

continue except in very special cases. Governments since then have generally adhered to that practice although, on occasions, allegations from an apparently authoritative source which, if true, would involve serious misconduct on ASIO's part have been denied. In addition, answers have been provided to parliamentary questions related to security checking for the Australian Public Service and some other matters which could be answered without

prejudice to nation~l security.

17.7 The Attorney-General has gone some way in seeking to

inform the public about security operations without compromising ASIO's operations. In particular, the former Attorney-General tabled in Parliament a report by ASIO on its activities in 1982-8 3. The report was based on ASIO' s annual report to the Attorney-General under the Act, but information about sensitive

intelligence matters was excluded from it. The tabling of that report was an important advance in the provision of information to Parliament and the public about ASIO.

17.8 The desire to provide more information about ASIO is commendable, and there are aspects of ASIO's activities which can be disclosed publicly without damage. On occasions, for pressing reasons that are seen as overriding the ordinary

restraints, Governments will be impelled to say something on a more sensitive question of security. The Ivanov/Combe matter is

an example of a case that, in the end, was subjected to

wide-ranging scrutiny and debate.

337.

17.9 However, very careful judgment is required to avoid obvious dangers in such disclosure~ The ready answering of

questions to which a response can be made without damage, or with little damage, may compound the difficulty of dealing with another question which raises more sensitive implications for national security.

17.10 Par 1 iament deals with ASIO' s f inane ial requirements by way of a one-line appropriation (15.12).

17.11 The recommendations I have made for an Inspector-General, and for a larger role for the Attorney-General's Department in support of the Attorney, are designed, by giving more substance to the Attorney's control over ASIO, to enable him to account to Parliament with more assurance. In particular, Parliament will know that, in appropriate cases, the Attorney has had

independent advice from the Inspector-General and is not merely relying on what ASIO has told him. In my view, the proposed

developments will have a very positive effect on the

Attorney-General's ability to account to Parliament.

17.12 I referred in 16.97 to the way in which at least the substance of the Inspector-General's annual report could be presented to Parliament together with an edited form of ASIO' s annual report. I recommend that the ASIO Act be amended to build

in a requirement that ASIO's annual report be formulated in such a way as to allow the Attorney-General to table in Parliament an

edited version, omitting material which in his discretion, on the advice of ASIO, should not be disclosed for reasons of securit y. The provision should still require the full report to be given to the Leader of the Opposition.

Leader of the Opposition

I

I

17.13 The provisions and practices for briefing the Leader of the Opposition in relation to ASIO are an important element of the Government's accountability to Parliament. I

338.

I

I

II

17.14 It is highly desirable, and has long been recognised, that the Opposition in the Parliament should be able to share with the Government some restricted knowledge of ASIO and its activities. Matters of domestic security affect the interests of

the nation and not just those of the government of the day. Yet of necessity they must remain veiled from broad scrutiny because of an overriding requirement of secrecy.

17.15 The ASIO Act contains several provisions that are directed towards achieving a degree of bipartisan awareness and understanding of ASIO and its role:

(a) the Prime Minister

Opposition on the Security (s.7(2)) (s.l4(2));

is required to consult the Leader of the appointment of the Director-General of or of a person to act as Director-General

(b) the Director-General is required to consult regularly with the Leader of the Opposition for the purpose of keeping him informed on matters of security (s.21);

(c) a copy of ASIO's annual report is to be given to the Leader of the Opposition, on the basis that it is to be treated as secret {s.94(2)).

17.16 Consultations and briefings of the kind provided for have taken place. The statutory provisions provide a basic framework on which consultation between Government and Opposition on

matters of national security can be built.

17.17 In my Report on Term of Reference (c), I referred to the briefing of the Leader of the Opposition in the Prime Minister's office on the Ivanov-Combe matter (paras. 3.18,3.19). I said there that if any statutory justification was needed for that

briefing it was to be found in s. 21 of the ASIO Act. I went on to express my view that:

339.

" " " irrespective of any statutory provisions about consultation with the Leader of the Opposition, it was entirely proper for Mr Peacock to have been informed of the Government's concern about Mr Ivanov's activities. Matters of national security ought to transcend party politica l considerations and should seldom be allowed to become subjects for partisan controversy.

17.18 The Prime Minister has authorized the Director-General to provide briefings to the Shadow Attorney-General as well as to the Leader of the Opposition. This revives a practice which had been introduced, but had fallen into disuse, under the previous Government. I endorse and encourage this practice but do not see a need to enshrine it in the statute. I think it can

appropriately be left as a matter for agreement betwe en Gov ernment and Opposition under the umbrella of the Opposition

Leader's statutory entitl ements.

17.19 As indicated in 16.96, I propose that the Leader of the Opposition should be provided with a copy of the

Inspector-General's annual report, and provision should be mad e for this in the legislation.

17.20 Precisely how consultation with the Opposition on matters of national security will be carried out is not something that can effectively be prescribed by statute. Much depends on the individuals concerned and on the spirit in which they approach the exercise. Effective consultation requires good faith on all I sides and an acceptance of the basis on which the consultat ion is taking place. It also requires a realisation that, whatever I may be the immediate sensitivity of information disclosed or the 1

inhibitions on use of that information, both Government and Opposition, as well as ASIO itself, share a very real interest in making the process work.

17.21 I have also considered whether consultation on matters related to ASIO and domestic security should be extended other non-Government parties in the Parliament. An argument be advanced for such consultation, with the objective

340.

to

can /,

of

spreading awareness and understanding of the issues more widely in the Parliament. However, I do not recommend the adoption of a general practice of providing briefings to members of such parties. As far as any legislative provision is concerned, I consider that the present approach of limiting any entitlements

to the official Opposition - the alternative Government - is the appropriate one. It is open to a Government, if it considers there is good reason, to extend briefing more widely, either in a specific respect or more regularly. I would leave this as a

matter for consideration by Governments from time to time.

Consideration of case for a parliamentary committee 17. 2 2 In RC IS I cone luded that I should not recommend that

there should be a parliamentary committee to scrutinize and supervise ASIO's activities (4:1-457). Having regard to developments since that time, and to submissions that have been made, I have given further and close consideration to the

question of a parliamentary committee.

17.23 Proponents of a parliamentary committee generally refer to Congressional oversight of the intelligence community in the United States of America. The relevant experience in that country over the last decade is certainly of great interest. The period has seen a marked increase in Congressional interest in,

and oversight of, the relevant agencies.

17.24 Congress's oversight of the intelligence community is primarily exercised through Select Committees on Intelligence in each of the House of Representatives and the Senate. From my understanding of those committees and their relations with the

agencies which they supervise, the system appears to be working quite effectively. The system seems to have done much to restore Congressional confidence in the intelligence community, and has given the agencies greater confidence that what they do is

understood and supported by Congress, at least in broad terms. The committees' record in protecting classified information

given to them appears to be generally good. The system has,

341.

"

however, come under some strain in dealing with matters

pertaining to issues that are publicly the subject of polit ical controversy.

17.25 A few points should be noted in relation to the two Congressional Intelligence Committees:

"

"

"

"

the members of each committee are selected by the majority and minority leaders in the relevant House; members are not elected by the parties;

the committees are provided with a good deal of cla∑ssif ied information in support of the agencies' budget bids and in briefings on CIA special operations, but sources and methods are generally not disclosed to them;

in particularly sensitive cases, . briefings by the agencies may be confined to the chairman and senior minority party 1 member of a committee;

committee members, and other members of Congress who, in certain circumstances, can have access to information held by a committee, accept very real restraints upon the use to

which they can put that material. Under the rules of ethics in force in each House, a member responsible for an

unauthorised disclosure of classified information is lia ble to censure, suspension or expulsion from the House;

staff members are not engaged by the committees until they have undergone security clearances by the Executive Branch;

the committees do not report to the House and the Senate generally on their oversight. They do publish reports on particular subjects from time to time, and they 'report' to each House financia l bills for the agencies {devoid of ' classif ied detail) and other legislative bills from time to time. Apart from that, oversight of the agencies is in

342.

effect delegated to the committees by their respective Houses.

17.26 It is particularly important to keep in mind what it is that the Congressional committees do in the course of their oversight. Much of their influence is exercised through their participation in the budgetary process. In reviewing the financial bids for the agencies the∑ y examine the justification advanced for the various programs for which the agencies are seeking funds. The emphasis in the review by the committees is on the nature of the programs rather than on particular

operations which may be included in them.

17.27 Very close attention is given also to the CIA's special operations, which are of a kind not engaged in by any Australian agency. From time to time the committees hold hearings on particular subjects related to the need for, or

new legislation. Except in their scrutiny

formulation of, of budgetary

proposals, the committees do not seem to be concerned much with those activities of the FBI which correspond to those of ASIO.

17.28 In Canada, the Commission of Inquiry concerning certain

activities of the Royal Canadian Mounted Pol ice recommended the setting up of a special parliamentary committee to oversee the activities of the Canadian Security Intelligence Service (CSIS) {Freedom and Security under the Law, 1981, Vol. 2, 904).

However, the Special Commit tee of the Senate which reported on

the CSIS Bill in November 1983 concluded that it would not be advisable to establish a parliamentary committee with special access to CSIS operations and information (Canadian Security Intelligence Service, Delicate Balance: A Security Intelligence Service in a Democratic Society, paras 99-101). The committee agreed that, ideally, such a committee could be of benefit. It

went on:

But there are many practical difficulties involved. A parliamentary committee would likely duplicate much of the efforts of the SIRC. Further, parliamentary commit tees are

34 3.

rt otor i ously subject to vagaries of time, changes in membership and overwork. There is also the problem of maintaining the security of information. This has reference in part to the possibility of partisan motivations in some members; but it also refers to the general question of whether that type of committee can maintain the requisite confidentiality by reason of the nature of its proceedings. In view of these considerations, the Committee believes that

it would not be advisable to establish a parliamentary committee with special access to CSIS operations and information (Para. 140).

17.29 The Canadian committee went on to note that the annual report of the Security Intelligence Review Committee ( SIRC) (a committee of Privy Councillors, not being members of parliament, appointed by the Government after consultation with Party Leaders) was to be tabled and ~hat, under the standing orders of

be referred to a the House, the report woulf. automatically standing committee. The Com~ttee said:

We would urge that th~ / appropriate committee give priority to consideration of /the SIRC report. Although such a commit tee would be relying on a report, and would not have original access to agency records, we expect that the quality and comprehensiveness of information which Parliament will receive about the operations of the security

intelligence system will be greatly improved, thereby achieving some of the objectives of a special committee. This would also likely stimulate a useful public debate on these issues (Para. 101) .

17.30 The essential relevant difference between the practice in Australia and that in the United States is that in our system the responsible Minister directly answerable to it.

is a member of Parliament and is

(This is so too in Canada). This is

no small difference when considering the case for a special commi ttee. Perhaps this difference helps to explain why in the

United States tension between Congress and the Executive appears to be greater, but partisan differences seem less marked, than under the Australian system.

17.31 Effective oversight of ASIO requires an ability to delve into detailed and sensitive information and activities. I have put forward proposals, especially that for an Inspector-General,

344.

W~ hich will put the Attorney-General in a .better position to

account for ASIC to Parliament and will give Parliament greater

assurance that the accounting it receives is full and accurate.

17.32 It is also important to bear in mind the arrangements

embodied in our system for the briefing of the Leader of the

Opposition.

17. 3 3 If a special commit tee to over see AS IO we re to have

access to detailed information consideration would have to be

given to the practical problems which wou ld be created by

further widening access to such information. Diffi cult questions

would also arise about the position of committee mem bers in

relation to such information. When the information is of

sensitive operational activities, committee me mb ers would in a share a degree of responsibil ity fo r those real sense operations. If the committee were not to have such powers, but were to concern itself only with more general information such as that to be found in annual reports of the Director-General or

the Inspector-General, it may be doubted whether a special

committee dedicated to that task would be justifie d .

17.34 Whether the House and Senate should establish committees, or a joint committee, is a question for them. It is not my task

to advise the Parliament. However, accountability is a key matter on which I am required to advise the Gov ernment. I have concluded that the most direct, and effectiv e , way to improve the accountability of ASIO is to strengthen the

Attorney-General's ability to carry out his present functions in

that area, including his ability to be fully and responsibly answerable to Parliament. In my view it is neither necessary nor appropriate that a special parli amentary committee be

established.

17.35 I make it

information, so requirements of

clear that far as is

I endorse steps to provide more

consist ent with the genuine

security, about ASIO to Parliament and the

345.

public. I refer in particular to the provision of annual reports including one from -the proposed Inspector-General. I refer also to the framing of guidelines which I have recommended should be laid down by the Attorney to regulate various aspects of ASIO's activities. Those guidelines will in many respects be able to be, and in my view should be, tabled in Parliament. It will be for the Parliament to decide how consideration should be given to reports and matters of that kind, whether by reference to a committee or otherwise.

Auditor-General 17.36 The arrangements for the auditing of ASIO, including the role of the Auditor-General, are relevant to ASIO' s financial accountability. These arrangements are discussed in Chapter 15.

Judicial review 17.37 Suggestions have been made publicly and in submissions to me, for ASIO to be subjected to judicial reviews on a regular basis. Precisely what form such reviews should take is not always made clear by those making the suggestions. Presumably one model is the review that I conducted in RCIS and again in the course of this Royal Commission.

17.38 Ad hoc reviews of this kind, conducted by someone from outside the intel ligence community, whether or not that person be a judge, can, I believe, serve a useful purpose. It will always be open to a Government to make arrangements for a review of this kind if it sees the need.

17.39 For the future, the office of Inspector-General, if established along lines I have recommended, will ensure a regular and planned independent review of ASIO and its

activities. As we ll as looking into particular complaints or issues that may arise from time to time, I contemplate that the Inspector-General would closely examine every aspect of ASIO in the course, say, of a three year period.

346.

17.40 To

effective, obviated.

the

the

There

extent that the Inspector-General proves need for separate judicial review will be is a need for effective means of review.

However, I caution against too many reviews and against unduly comp lex review mechanisms. As I indicated in 16.4, there can be too much oversight. I am conscious of the demands that reviews of the kind I have undertaken make upon an organisation and its

ma nagement by compelling it to provide briefings and responses

to particular inquiries. Over lapping, or too frequent, reviews may unnecessarily impede ASIO in doing the work for which it is

established. Over-kill is to be avoided.

17.41 I do not, therefore, recommend the institution of a form of regular independent review apart from that to be conducted by the proposed Inspector-General.

Accountability to the public 17.42 ASIO is accountable to the public primarily through the Parliament~ To the extent that Parliament is provided with more

information, in the form of reports or through statements or

answers to questions by the Attorney-General, the public as well

as the Parliament is better informed.

17.43 ASIO is already made accountable for its personnel security assessments which are subject to appeal to the Security Appeals Tribunal. I discuss possible extension of procedures for redress separately.

17.44 It remains true, however, that the public is not well informed about ASIO. Perhaps as a consequence, ASIO comes in for a lot of unfounded and inaccurate criticism and comment in the

public media and elsewhere. It is tempting to say that this

could be reduced if ASIO made a more conscious public relations effort. However, it is undeniable that the nature of ASIO's functions and activities severely circumscribe the possible scope for such effort. There will from time to time be

opportunities for ASIO to show a public face, or for the

347.

Attorney-General on its behalf to explain what it is doing and why. Provided careful consideration is given beforehand, those opportunities should be taken. I discussed these issues at greater length in Chapter 2.

17.4 5 I believe there is scope for ASIO to be more open about the identity of some of its officers. At present, some senior and other staff of ASIO become fairly widely known as emp loyees of ASIO by reason of duties that bring them openly into contact with people outside the Organization. However, the identities of ASIO officers are not generally otherwise declared. Section 9 2

of the ASIO Act makes . it an offence publicly to identi fy an employee or agent of ASIO or of a person connected with such an employee or agent. There are good security reasons for

p rotecting the identiti es of some, but not necessarily all, ASIO

officers. Corresponding provisions in the Canadian Security Intelligence Service Act (s.l8) and the United States Intelligence Identities Protection Act of 1982 are related more clearly to people with an operational need for anonymity.

17.46 The present 'blanket' protection in s.92 tends to reinforce the negative aspects of the 'closed' nature of ASIO. Some lifting of the legal veil or anonymity from senior

officers, such as Branch Heads and Regional Directors, would not be a bad thing. It might aid the development of a healthier relat ionship between ASIO, on the one hand, and other government bodies, and the public, on the other. It would introduce a further element of personal accountability into ASIO' s senior management. There is already provision in s. 92 for the

Attorney-Genera l or the Director-General to consent to publicati on of a particular name or names. I recommend that consideratio n be given by the Director-General to acknowledging publicly - perhaps in an annual report tabled in Parliament -

the identities of his more senior officers save for any case in which there might be a particular security reason for not doing so.

348.

Redress mechanisms 17.47 Submissions were made to me about procedures for handling grievances held by people against ASIO and for providing redress in appropriate cases. They were directed in particular to extending the range of circumstances in which a review of ASIO 's

activity would be available.

l 7. 48 The submission of the Australian Labor Party called for

effective redress for persons or organisations who have been unjustifiably disadvantaged by the activities of ASIO, and for

individuals claiming to be prejudiced by ASIO activities outsi de its legislative charter.

17.49 In approaching this question it is useful to recall wh at it is that ASIO does that may adversely affect people and call

for redress.

17.50 ASIO 1 s functions are confined to obtaining and assessin g security intelligence, communicating such intelligence to others for purposes relevant to security and advising the Government on security matters (s.l7(1)). Section 17(2) emphasises that AS IO has no executive character by expressly precluding it from carrying out or enforcing security measures within Commonwea lth

authorities. ASIO has no power to detain, arrest or interroga te

individuals. It is not empowered to make decisions which in themselves affect the rights of other persons.

8.51 Any attempt by ASIO to deal with an individua l in a wa y

exceeding its legislative authority would be ineffect ive in law. Moreover, if such action resulted in damage being inflicted upon the person or property of the individual, ASIO would be exposed to legal liability. A person who is able to establish a cause of

action against ASIO by reason of unlawful conduct or breach of

legal obligation can have recourse in the courts. Such a case

might arise, for example, if in the course of their activ ities ASIO officers cause damage to person or property through

negligent driving, or if they damaged property in some otner

349.

way,as ASIS personnel did in the lamentable Sheraton Hotel incident.

17.52 The High Court made it clear in Church of Scientology v. Woodward (1982) 43 ALR 587 that the courts can review whether

ASIO's actions are within the scope of constitutional and legislative power. There may, however, be significant practical difficulties in mounting a successful case of that kind.

17.53 In giving advice, ASIO may provide the person or

authority to whom the advice is communicated with grounds for taking adverse action or an adverse decision in relation to an individual.

17.54 There is laid down in Part IV of the ASIO Act a procedure by which such advice from ASIO about an individual - referred to

as a security assessment may be reviewed by the Security Appeals Tribunal. That right to a review is available in respect of the great majority of security assessments given by ASIO about an individual which may prejudice that individual. The

right does not extend to people who are not Australian citizens or long-term residents (s. 36).

17.55 The right to a review is limited to assessments given after the present Act came into force, although the

Attorney-General has a discretion under s.65(1) to refer earlier cases to the Tribunal. The Attorney also has a discretion under s.65(1) (b), where a person complains that he has been the subject of an ASIO security assessment, a copy of which was not provided to the complainant, to require the Tribunal to inquire and report to the Attorney upon any question concerning the action or alleged action of ASIO. The Attorney may also require the Tribunal to review any such assessment that was provided.

17.56 I believe that the preliminary or factual inquiry which is contemplated by s. 65 ( 1), whether in respect of assessments issued before or after the legislation commenced, could more

350.

appropriately be carried out by the proposed Inspector-General. Such an inquiry might be directed to establishing whether the facts were as represented by the complainant and to the

lawfulness or propriety of ASIO' s act ions. If the

Attorney-General concluded that a security assessment provided by ASIO did call for review on the merits, the Security Appeals

Tribunal would still be the body to which he would refer it. I recommend that s.65(1) of the ASIC Act be amended along the

lines proposed.

17.57 There are some actions of ASIO impinging on an individual which do not give rise to a right to review under the statutory provisions. The circumstances that arose concerning Mr Combe in the Ivanov/Combe affair provided an example. In my Report on Term of Reference (c) I expressed the view that there was a need

for extension of the process of review to cover cases of that kind. I said (para. 6.40) that:

It would be far better, and more just, if the course to be followed where an individual will, or may, be adversely affected by a decision taken upon advice by ASIO, not being a decision already covered by the provisions of the Act, were clearly defined. I have no doubt that, in some cases, a person who will be adversely affected by a Cabinet decision

based on national security grounds cannot be given a hearing. It would not have been possible or reasonable, as Mr Combe agreed in evidence, to have given Mr Ivanov a

hearing. Likewise, I have no doubt that there are other cases where a hearing would be fair and just, either before any decision is taken, or after some interim decision has been taken. There are formidable difficulties in formulating

the precise nature and extent of the right, but the time has come when these difficulties must be overcome. In the course of my general inquiry, I will give consideration to the establishment of an independent body. Such a body would decide whether a person likely to be adversely affected by a decision made on ASIO' s advice should be given a hearing,

and what he should be told if a hearing is given. It would also be required to supervise and to report upon the hearing.

I indicated further (page 218, paragraph 2) that I would, in

this report, make recommendations on:

(c) The need for the establishment of a statutory procedure enabling an independent body to decide, in appropriate

351.

cases, whether, and, if so, how an Australian citizen or resident should be provided with an opportunity to be heard when a report by ASIO may result in action adverse to the interests of that citizen or resident.

17.58 I now recommend that the ASIO Act should be amended to

enable the Attorney-General, in any case where a report by ASIO may result in action adverse to the interests of an individual,

and where the individual does not already have a right to review of that report, to refer the matter to the Security Appeals Tribunal for advice on the appropriate procedures to be followed by the Government having regard to the interests of the person

who is exposed to possible prejudice. In particular, the

Tribunal could be asked to consider whether the person should be given notice and an opportunity to have tested the information from ASIO on which the Government is proposing to act or has taken interim action. This procedure should normally be 1 imi ted to cases where an Australian citizen or a permanent resident is at risk, but the Government's discretion should be wide enough

(with an appropriate amendment to s. 36) to enable the procedure to be followed in other cases where special considerations may apply (on the basis of the Tribunal dealing with the matter without the need to conduct hearings overseas).

17.59 The Tribunal is in my view an appropriately constituted body for t-his purpose and I see no need for creation of a new body to undertake this role. I recommend also that the Tribunal would be the appropriate body to test the information and to give the affected person an opportunity to be heard, if that is

the course decided upon.

17.60 I have concluded, and I recommend, that any such role for the Security Appeals Tribunal should be advisory only. The responsibility for decisions of the kind in question lies, and in my opinion should rest, with the Government. However, in the sometimes difficult circumstances which can arise, reference to the Tribunal will give the Government the benefit of independent advice. As well the individual in question will benefit from an

352.

independent body examining the propriety and fairness of the procedure proposed by the Government.

17.61 The aim of the recommendation just made is to provide a means for working out, with independent advice, a fair way of handling unusual cases which do not lend themselves to

straightforward provision for notice to an affected party and a right of review. If its recommendation were adopted, an affected party would not have a right to be notified of the matter or to invoke a review by the Security Appeals Tribunal. If the person did know or believe that adverse action based on advice from ASIO was impending, he could address his concerns to the

Attorney-General, or to the Inspector-General, and request a reference to the Tribunal. It would be open to the

Inspector-General in such a case to recommend to the Attorney that there be a reference to the Tribunal and he could refer to such recommendations and the Government's action on them in his annual report.

17.62 I mention here a proposal by ASIO, which I discussed

earlier (11. 76-77}, to extend the jurisdiction of the Security Appeals Tribunal in relation to assessments that are sometimes provided by ASIO in deportation cases.

17.63 The other possible activity of ASIO that may give rise to grievances is its collection of intelligence about individuals or organisations. The very fact that ASIO takes an interest in, or collects information about, a person, or is thought to do so,

may cause concern to that person. This will be more so where the

means used by ASIO intrude into the person's privacy. The

concern may be about the justification for ASIO's conduct. Or it may go to the accuracy of the information collected, or the way

in which it is held or used w ithin ASIO.

17.64 There are many people who feel a grievance about actions or perceived actions of ASIO in collecting or using information about them. Quite often, for example, people believe that they

35 3.

are under ASIO surveillance or that ASIO is intercepting their telephone conversations. In some cases they believe that ASIO has improperly passed information detrimental to them to an employer or other person. They wish to find out whether their beliefs are true, and, if so, the basis for ASIO's action. They may be looking for compensation or other redress.

17.65 I emphasise that I am referring now to grievances about ASIO' s conduct in collecting or handling intelligence, not in

providing to another person or authority, as authorized by the Act, advice which may lead to action adverse to an individual.

17.66 As I have just indicated, the aggrieved person often only believes, but does not know, that ASIO has acted in a particular way. In the absence of evidence of unlawful action which would

provide a basis for legal action against ASIO, the only grievance procedure normally available .is to direct a complaint to the Attorney-General.

17.67 For the future, the changes I am recommending to

strengthen the control and accountability of ASIO will provide some reassurance to those people who have a general apprehension that ASIO is engaging in activity that is unlawful or otherwise unjustified.

17.68 Where a person has a more specific grievance, I consider it would be appropriate for the proposed Inspector-General to investigate such a complaint. The Attorney-General could refer complaints to the Inspector-General or complainants could approach the Inspector-General direct. The Inspector-General would in this respect perform a function comparable with that

performed by the Ombudsman in relation to most Commonwealth authorities.

17.69 I recommend that, subject to a discretion not to pursue vexatious or frivolous complaints, the proposed

Inspector-General should inquire into complaints made to him

354.

I ll

direct, or refer red by the Attorney-General, of act ion by ASIO in collecting or handling information about the complainants and should report to the Attorney General, with a copy to the Director-General, on the outcome of his inquiry. The

Inspector-General should also recommend what action, if any, should be taken to inform the complainant of the outcome and otherwise to provide redress {e.g. correction of inaccurate information held by ASIO or destruction of information collected without proper cause) " In an appropriate case, the

Inspector-General should be able to recommend payment of compensation, which presumably would have to be by way of ex gratia payment in the absence of any legal liability.

17.70 result Often

The ultimate decision on any of such an inquiry should be

security considerations will

action to be taken as a the Attorney-General's. preclude advice to the

complainants of the outcome of such a complaint. A 'neither confirm nor deny' answer may have to be given. In those cases the Attorney may at least be able to assure the complainant that the Inspector-General has looked into the matter and satisfied

himself that ASIO had complied with the Act and relevant

guidelines.

17.71 I have considered very carefully submissions to the effect that, subject to a filtering process by somebody like the proposed Inspector-General, the Security Appeals Tribunal should review grievances about the conduct of ASIO in collecting or handling intelligence as distinct from advising on the basis of

intelligence. I have concluded that it is not necessary or appropriate to superimpose such a review on the inquiry which would be conducted by the proposed Inspector-General.

17.7 2 Often, as already indicated, an aggrieved person may believe, but will not know, that ASIO has acted in a particular way. The submission by the Australian Labor Party noted:

" " " fishing expeditions into ASIO's activities should not be permitted: nor should a person be able, by virtue of some

355.

review Tribunal, to, in effect, deliver compelling ASIO to disclose whether he was 'target' " a requisit ion

or was not a

These considerations suggest that any inquiry should be more like those carried out in other areas by an Ombudsman. Such an inquiry would appropriately be entrusted to the proposed Inspector-General. In this area a quasi-judicial inquiry of the kind that the Security Appeals Tribunal is well suited to carry out seems inappropriate. The emphasis will be on ascertain ing the facts and circumstances by direct inquiry rather than on call ing on ASIO to justify an acknowledged action or opinion on

its part.

17.73 Moreover, many of the questions that will arise from such comp laints based on mere belief will be less 'justiciable' than questions of the kind with which the Security Appeals Tribunal now deals. The latter questions require a focus on whether a security assessment is justified on the facts and by refere nce to the definition of security in the ASIO Act.

17.74 I consider that it is unnecessary to involve the Tribunal, as well as the proposed Inspector-General, in scrutinising the propriety of particular operational activi ties of ASIO. Once the Inspector-General has ascertained the facts of

a case, it will be appropriate for him, consistently with his general role, to consider the lawfulness and propriety of ASIO 's acti on. There is no further standard or test which I can see that could sensibly be left for application by the Tribunal.

17.75 I have considered also whether a question of

comp ensation, should the proposed Inspector-General consider one

to arise, could be referred to the Tribunal. It seems to me, howe ver, that any question of payment will be one for the

Gove rnment and that the Inspector-General, having investig ated the matter, will be well placed to make a recommendation on

356.

compensation. To involve the Tribunal in reviewing or making such a recommendation would prolong the process for the sake of getting its advice on a question which I do not see as falling within its particular competence.

357.

... " f"i

...

,

APPENDIX A

TERMS OF REFERENCE

COMMONWEALTH OF AUSTRALIA

ELIZABETH THE SECOND, by the Grace of God Queen of Australia and Her other Realms and Territories, Head of the Commonwealth:

To:

THE HONOURABLE MR JUSTICE ROBERT MARSDEN HOPE, C.M.G., Judge

of Appeal, Supreme Court of New South Wales

GREETING: WHEREAS it is desired to have a judicial review of the

activities of Australia's security and intelligence agencies, namely, the Australian Security Intelligence Organization, the Australian Secret Intelligence Service, the Defence Signals Directorate, the Joint Intelligence Organisation and the Office of National Assessments (hereinafter called "the agencies"):

NOW THEREFORE We do by these Our Letters Patent issued in Our name by Our Governor-General of the Commonwealth of Australia on the advice of the Federal Executive Council and in pursuance of the Constitution of the Commonwealth of Australia, the Royal Commissions Act 1902 and other enabling powers, appoint you to be a Comm1ss1oner to inquire into, and in relation to -

(a) the activities of the agencies, especially since the completion of the inquiry made by the Royal Commission appointed on 21 August 1974 to inquire into matters relating to the intelligence and security services of the Austral ian Government (hereinafter called the Royal Commission on Intelligence and Security), with particular reference to -

( i) the progress made in implementing Governmen t decisions on the recommendations of the Royal Commission on Intelligence and Security and of the Protective Security Review; (ii) whether the agencies have efficiently, effectivel y

and properly served the interests of the

Australian people and Government, includin g whether effective arrangements exist for the establishment of policies and priorities, for the co-ordination of their activities and for the oversight of their work; (iii) whether any changes in existing law and practices

are required or desirable -(A) to ensure that the agencies are properly accountable to Ministers and the Parliament; (B) in relation to keeping the Leader of the

Opposition informed on matters relating to security and intelligence;

358 "

(C) to provide for proper safeguarding, including safeguarding against unauthorised publication, of intelligence, including information provided by foreign governments in confidence; (iv) whether there is adequate provision for effective

redress for any persons who may be unjustifiably disadvantaged by actions of the agencies; (v) whether existing law enables effective oversight by the Auditor-General of the Austral ian Security

Intelligence Organization and the Australian Secret Intelligence Service in financial matters; (b) whether the activities of the Australian Security Intelligence Organization, especially since the

completion of the inquiry made by the Royal Commission on Intelligence and Security, have been carried out in compliance with the law, in particular the Australian Security Intelligence Organization Act 1956, the Australian Security Intelligence Organization Act 1979,

the Telephonic Communications (Interception) Act 1960 and the Telecommunications (Interce tion) Act 1979; (c) further to t e 1nquiry 1n re ation to paragraphs (a) and (b) above, all the circumstances, including the actions

of the Government, surrounding the expulsion from Australia of Mr Valeriy Nikolayevich Ivanov, First Secretary, Embassy of the Union of Soviet Socialist Republics, and the involvement of Mr Harvey David Mathew Combe in those circumstances; and (d) any other related matters to which the attention of the

Commission is directed by the Prime Minister in the course of the inquiry:

.AN D We require you as expeditiously inquiry and to furnish to Our

C ommonwealth of Australia -as possible to Governor-General

make of

your the

(e) first and as soon as possible, a report of the results of your inquiry and recommendations in relation to the matters specified in paragraph (c); and (f) a report or reports as soon as possible, and In any

event not later than 30 June 1984, * of the results of your inquiry and recommendations in relation to the matters specified, or referred to, in paragraphs (a), (b) and (d) .

(L.S.) WITNESS His Excellency the Right Honourable Sir Ninian Martin Stephen, a member of Her Majesty's Most

Honourable Privy Council, Knight of the Order of

Australia, Knight Grand Cross of The Most Distinguished Order of Saint Michael and Saint George, Knight Grand

* Extended to 31 December 1984 by Letters Patent issued on 18 May 1984

359.

Cross of The Royal Victorian Order, Knight Commander of The Most Excellent Order of the British Empire, Knight of the Most venerable Order of the Hospital of Saint John of Jerusalem, Governor-GenerQl of the Commonwealth of Australia and Commander-in-Chief of the Defence Force.

Dated this seventeenth day of May 1983.

By His Excellency's Command, BOB HAWKE

Prime Minister

360.

N.M. STEPHEN, Governor-General

APPENDIX B

SUBMISSIONS AT PUBLIC HEARINGS

The following individuals and organisations made submissions at

public hearings of the Commission:

Council for Civil Liberties (submission presented by Professor K.D. Buckley)

Professor Russel Ward

New South Wales Society of Labor Lawyers (submission present ed

by Ms B Schurr)

Campaign for Independent East Timor (submission present ed by Mr

D.W.F. Freney)

Australian Civil Liberties Union (submission presented by M r J .T. Bennett)

Government of South Australia (submission presented by Mr Gray, Solicitor-General for South Australia)

Mr K. Fry, MHR (Member for Fraser}

Messrs. R. Mathams and P. Dibb

Communist Party of Australia (submission presented by Mr B.

Aarons)

361.

..

ADVERTISEMENT

APPENDIX C

SPIEGEL v. NOW! MAGAZINE

AUGSTEIN v. GOLDSMITH

.............

Spiegel Verlag Rudolf Augstein GmbH&CoKG Sir Ja.s Goldsm ith Cave nha111 Comm unications Lim ited

Anthony Sh rinley RudoN Augstein

In tbe High Court of Justice, Queen's Bench Division, on 8 October 1984, tbe following agreed statement was read out:

Mr. John Wilmers QC- Counsel for the Plaintiffs

My Lord. I with my Learned friends Mr Charles Gray and Mr Andrew Monson represent the Plaintiff s who are the owners and publisher of the We st Ger " man weekly magazine Der Spiegel_ My Learned friends Lord Rawlinson, Mr Andrew Bateson, Mr James Price and Mr Mark Warby represent the Defendants Sir James Goldsmith, Cavenharn Com " mwtications Limited and Mr Anthony Shrimsley _

On the 21st day of January, 1981, Sir James Goldsmith delivered a speech to the Media Conunit " tee of the Conservative Party in the House of Com " mons which was subsequently published, inter alia, in Now! magazine, edited by Anthony Shrimsley.

lb.is speech dealt with Soviet propaganda and the systematic manipulation of the Western media by cer " tain organs of the Communist Party of the Soviet Union. Sir James went on to describe the three major organisations used for this purpose and which report to the Politburo in Moscow : the International Depart " ment headed by Boris Ponomarev; the Internation al Wormation Department headed by Leonid Zamiatin and the KGB controlled Soviet propaganda organisa " tion called Service A wh ich is part of the KGB 's First Chief Directorate. Service A plans, coordinates and supports secret operation s which are designed to back up overt Soviet propaganda-

As an example, Sir James made reference to information provided by General Jan Sejna, a former high official of the Czechoslovak government, and for " mer Secretary of the Czechoslovak ruling party's Defence Committee, who defected in 1968. Sir James stated "General Sejna, the high-ranking Czech intelligence defector, admined that the campaign by the German new s magazine De r Spiegel to discredit Franz Josef Strauss was orchestrated by the KGB ".

It is to this referen ce that the Plaintiffs have taken exceptio n in that they felt that it implied that the magazine was under the control of the KGB , know " ingly employ journalists wh o are Communist intelli " gence agents and in fact are a KGB front organisation . My clients were concerned to refute and deny any such suggestions and to ensure that the ir journalistic and editorial independence is not in question.

Lord Rawlinson QC - Counsel for tbe Defendants

Sir James' positi on is that in pursuance of the1r policies, the Soviets conduct massive and continuous propaganda campaigns "ooth overt and covert - the

former through overtly controlled Communist media throughout the world, the latter consisting of the dissemination and planting of stories. many of which are based on forgeries and deliberate falsehoods known as "disinformation"_

The ultimate object of the campaigns is the wtder " mining of free Wc s te ~ :~ societies and political system s. In particular they aim to promote ideas. individuals and governments helpful to Soviet strategy and conversely to discredit those hostile to the interes ts of Communism .

In pursuance of their aims the Soviets malce use of wtwitting Western media. In addition to the overtly controlled Communist press - the value of which is limited since the sources are publicly known - there is a major and continuous effort to plant propaganda covertly through well placed agents of influence who themselves may be either conscious or unc<>nscious of the role that they are playing. The media thus used are not intended to realise that they are participating in KGB orchestrated campaigns.

It is Sir James' position that in pursuance of these policies, the Soviets made a conscious decision to seek to discredit the West German politician Dr. Franz Josef Strauss and mounted a campaign of defamation, disinformation and provocation against him. Franz Josef Strauss was Minister of Defence in Chancellor Adenauer's government when he made a speech in the Bundestag calling for the deployment on German soil of U.S. controlled nuclear weapons so as to counterbalance the growing Soviet threat . It is Sir James' position that against that background the Soviets decided to make use in that campaign of the fact that Der Spiegel was well known as opposing Dr. Strauss' political views and regularly published arti " cles expressing that opposition .

In support of his case Sir James had arranged to call witnesses from this country, the USA and West Germany who would have testified as to Soviet policy in general and to the special role and organisational structure of Soviet coven propaganda. In addition Sir James would have called high level Soviet and Soviet bloc defectors, wh o in their former capacity as officers of the KGB or satellite intelligence services . had themselves been involved in disinformation and penetration of Western media including the recruit " men! of W estern agents of influence, among them journalists. They would have given evidence uf a

number of instances of Soviet "active measures"_

More specifically certain of these high level officials (who have since defected to the West) would have ~ven evidence of meetings at which plans were

approved to seek to discredit Dr. Strauss and to use Der Spiegel in the manner I have indicated . Such witnesses would have testified to the fact that the v~st majority of the Western media which are used do not know that they are being so used and further that an important part of the planning of such operations is to ensure that the publications remain unaware of the source of the material which is supplied to them and that most of the individuals con " cerned do not know that they are ultimately serving Soviet purposes.

Finally, Sir James would have called General Sejna who has sworn an affidavit confirming that he made the statements quoted by Sir James and to which the Plaintiffs have objected.

It was and remains Sir James' position that many Western publications were and are unwittingly used by the Soviets in their campaigns conducted by the KGB and other Soviet organisations . So in Sir James' view, Der Spiegel, in common with other Western publications, can themselves fairly be described as victims of KGB propaganda techniques .

I am happy to state publicly on behalf of all the Defendants, as was indicated before these proceed " ings began, that it was never intended by Sir James to imply that the Plaintiffs or their paper were controlled by or cooperated with Soviet Intelligence or know " ingly employed any journali st who was a KGB agent.

Mr . Jobn Wilmers QC- Counsel for the PlaintiiTs

My Lord, in the result my clients now take the view that it is unnecessary for them to proceed any further with this action. They have of course not seen any of the Defendants' evidence, but they fully accept that broadly speaking Soviet Intelligence seeks to operate in the way stated by my Learned friend, although they themselves are not conscious of having been used in the manner mentioned by Sir James Go ldsmith. My clients are conscious of the dangers to press freedom posed by Soviet covert propaganda

l am happy to say that the parties, upon the basis of this agreed statement, have agreed that the action should be withdrawn. In the circumstances all that remains is for me to ask your Lordship for leave to withdraw the record .

CA YENHAI\-1 COMM UMC.-'.110.'-S Lh\11 fED. C-\ \"E.:'IIHA:'\1 HOl;SE, PARK LANE, C RANFORD . MIDDLESEX. TWS 9RN

362.

APPENDIX D

SUBVERSION

Canadian developments 1. After a long gestation the Canadian Security Intelligence Service Act was passed by the Canadian Parliament in June 1984. In that Act 'threats to the security of Canada' attract the

application of a number of provisions. Those threats are defined in s.2 of the Act to be:

(a} espionage or sabotage that is detrimental to the interests of directed toward or in support sabotage,

against Canada of such

Canada or is

or activities espionage or

(b) foreign influenced activities within or relating to Canada that are detrimental to the interests of Canada and are clandestine or deceptive or involve a threat to any person,

(c) activities within or relating to Canada directed toward or in support of the threat or use of acts of serious violence against persons or property for the purpose of achieving a political objective within Canada or a

foreign state, and

(d) activities directed toward undermining by covert unlawful acts, or directed toward or intended ultimately to lead to the destruction or overthrow by violence of, the constitutionally established system of government in Canada,

but does not include lawful advocacy, protest or dissent, unless carried on in conjunction with any of the activities referred to in paragraphs (a) to (d) "

2. The passing of the Act was oreceded by extensive debates in the Canadian Parliament, and the Bill was the subject of a report by a Committee of the Senate. Neither debates nor report throw any light on what it was contemplated might be the

unlawful acts referred to in paragraph (d), but the word 'covert' was the subject of some debate in the House of Commons. A member of that House referred to the action of an organisation

363.

of farmers in blocking roads in order to achieve a political purpose and said that, although this action was unlawful, it should riot be the subject of any investigation by Canada's security organisation. The Solicitor-General (who, in Canada, is a Minister) agreed and said that the word 'covert' was directed

to this type of situation. The unlawful acts of the farmers were overt and it was only if activities were covert and otherwise satisfied the requirements of the definition that the security organisation would be justified in investigating them.

United States developments 3. The position in the United States in relation to the investigation of domestic subversion changed considerably in 1976 following what were claimed to be improper and excessive activities by the FBI and the CIA and which were publicised,

inter alia, by the inquiries before Committees of the Senate and the House of Representatives. In that year Guidelines for FBI Domestic Security Investigations were issued by the

Attorney-General authorising the undertaking of preliminary investigations (relevantly) only on the basis of allegations or other information about the possible use of force or violence for purposes including the overthrowing of the Government of the United States, substantially impairing for the purpose of

influencing United States Government policies or decisions the functioning of the Government of the United States, or the depriving of persons of their civil rights under the Constitution, laws or treaties of the United States.

4. The guidelines also authorised more extensive investigation depending on the confirmation of the allegations or information, and limit ed the use of intrusive investigative techniques at the initial stage of investigation.

5. The 1976 guidelines were revised and replaced by a new set which were in turn replaced by a further set, issued by the

364.

I

I

I

Attorney General in 1983, called 'Attorney General's Guidelines on General Crimes, Racketeering Enterprise and Domestic Subversion/Terrorist Investigations'.

6a The guidelines state that investigations by the FBI are

premised upon the important duty of government to protect the public against, inter alia, those who would engage in political or racial terrorism or would destroy the constitutional system through criminal violence. As regards

subversion/terrorist' activities, the current authorise the initiation of an investigation:

'domestic guidelines

when the facts or circumstances reasonably indicate that two or more persons are engaged in an enterprise for the purpose of furthering political or social goals wholly or in part through activities that involve force or violence and a violation of the criminal laws of the United States.

7. The guidelines

enterprises, rather are concerned with the investigation of than individual participants and specific criminal acts, and authorise investigations to determine the

structure and relationship the scope of the

of the members.

enterprise as They do not

well as the

apply where

international terrorism or the activities of foreign powers are involved. Separate guidelines deal with those activities.

8. The 'reasonable indication' necessary for the initiation of a general investigation involves a standard 'substantially lower

than reasonable cause'. The standard requires specific facts or circumstances indicating that two are, or are about to be eng aged described; there must be an

or more per sons have

in an enterprise of the objective-factual basis

been, kind for

initiating the investigation; a mere hunch is insufficient. In determining whether an investigation should be conducted, the FBI must consider all the circumstances including:

(a) the magnitude of the threatened harm; (b) the likelihood that it will occur;

365.

(c) the immediacy of the threat; and (d) the danger to privacy and free express ion posed by an

investigation.

The investigation may collect such information as the members of the enterprise, its finances and geographical dimensions, and the past and future activities and goals of the enterprise, with a view to the longer range objectives of detection, prevention,

and prosecution of the criminal activities of the enterprise.

9. In the absence of any information indicating planned violence by a group or enterprise, mere speculation that force or violence might occur during the course of an otherwise peaceable demonstration is not sufficient grounds for initiation of an investigation, but this direction does not preclude the collection of information about public demonstrations by enterprises that are otherwise under active investigation pursuant to the guidelines.

10. The facts or circumstances which reasonably indicate the existence of the enterprise may come from various sources including a general crimes inquiry. Such an inquiry may be carried out, on a preliminary basis, when the FBI receives

information or an allegation not warranting a full investigation because of the absence of specific facts or circumstances indicating a past, current or impending criminal activity, but reasonably justifying some further scrutiny.

11. The guidelines require a preliminary inquiry of that kind to be as little intrusive as the needs of the situation may permit. Certain investigative techniques such as opening mail and electronic surveillance are prohibited; some techniques, including interviewing established informants and sources and physical and photographic surveillance are authorised; and techniques not expressly prohibited or authorised are authorised if approved by a senior officer. Such an inquiry could be based on allegations or information about the possibility of criminal

366.

violence, and might produce information justifying a domestic security/terrorism investigation. Where a general investigation is undertaken the FBI may use any lawful investigative technique subject to a general injunction in favour of less rather than more intrusive means.

367.

--

~.

APPENDIX E

ASIO GUIDELINES FOR COVERAGE OF MASS ISSUES

(Comments in the guidelines on actual examples have been deleted) The present policy regarding the coverage of mass issues is predicated on the concept that ASIO should not gather

intelligence on mass issues {protests and demonstrations) , except where particular activities or requirements fall within the provisions of the ASIO Act 1979 and it is the judgment of Headquarters that the relevant sections of the Act should be

invoked. Those circumstances are:

{a) When ICP targets become involved, especially if they engage in violent activity and encourage others to do so, or attempt to exploit the movement in other ways for their own ends. However, as pointed out in HQS memorandum 6993 of

12 October 1976:

".. Where such an

demonstration, ASIO's with the nature,

involvement .. " '

organisation is involved in a interest normally beg ins and ends extent and success of that

Similarly, involvement in mass issues by individual members of target organisations may not be of sufficient

significance to warrant ASIO coverage.

(b) It it becomes apparent that some of the protesters intend using acts of violence against persons or property for the purpose of achieving a political objective, i.e. with in the meaning of Section 4 paragraph (a) of the Act. A distinction should be drawn between premeditated acts of politically motivated violence and tactics of confrontation, minor breaches of the peace and 'heat of the moment' scuffles of a violent nature, which are matters for the pplice " ". "

(c) In connection with VIP or IPP protection responsibilities. Although the specific objective would be to gather

intelligence on threats to life or limb of the VIPS or IPPs involved, in circumstances such as these ASIO may need to:

' ... take a greater interest in the occasion than it would otherwise be entitled or would wish to do (HQS

memorandum 6993 of 12 October 1976).

(d) It it becomes necessary to invoke the provision of Section 5 (1) (b) of the Act to assist in the protection of vital Defence Force 1nstallations. Although the wording of this sub-section is of w1de 1mport, it should not be invoked in peace time, except in special circumstances. For example,

there may be a case to invoke Section 5 (1) (b) in peace time in connection with those sensitive Defence force

368.

installations where an interruption to the services they currently provide may be prejudicial to national security . .. " With regard to the latter category, this sub-section should only be invoked when it is apparent that protesters have the clear intention to close the facilities concerned

or to disrupt seriously the services they provide "...

2. Accordingly, regional offices should not anticipate Headquarters concurrence for the use of intrusive means to gather intelligence on mass issue movements or protest groups, unless it can be justified in terms of these guidelines.

3. However, under the general authority of Section 17 of the Act, regional offices may conduct routine enquiries (interviews and contacts etc.) if they have reason to be 1 ieve that

individuals or groups may be planning activities falling within the provisions of the Act. Information gathered during those enquiries should not be recorded or reported to Headquarters unless it falls within the criteria for recording and reporting set out in the Reporting and Recording Criteria dated March

1981, ie. unless the activities do, or have the potential to, fall within the provisions of the Act. 4. If ASIO has no legitimate interest in demonstration or protest activity in terms of the Act, then it is a matter for

local authorities ( e spec i a 11 y the police) to obtain forewarning, make their own assessments and to take appropriate

counter-measures to maintain law and order.

369.

APPENDIX F

REPORTING ON CIVIL DISORDERS AND DEMONSTRATIONS INVOLVING A FEDERAL INTEREST

I. Basis for Reports and Investigations The Federal Bureau of Investigation reporting information on civil demonstrations in four categories:

A. Investigating --

is responsible for disturbances or

1} violations of federal criminal law directed explicitly at civil disorders (e.g. 18 u.s.c. 231, 2101); and

2) violations of federal criminal law of general applicability occuring during civil disorders. B. Providing information and assistance, upon request of the Secret Service, to aid in carrying out its

protective responsibilities under 18 u.s.c. 112, 970, 3056 and P.L. 90-331.

NorE: Under 18 u.s.c. 112 and 3056 the Secret

Service is assigned responsibility to provide protection to certain u.s. Government officials and foreign officials and visitors. P.L. 90-331 provides Secret Service protection for candidates for office and authorizes Secret Service to call on any federal agency to assist in this regard. Responsibility for protection of foreign missions

is assigned to the Executive Protection Service under the direction of the Secret Service. This accounts for the reference to 18 u~s.c. 970 dealing with damage to foreign missions.

C. Providing information concerning actual or

threatened civil disorders which may require the presence of federal troops to enforce federal law or fed era 1 court orders ( 1 0 U. S " C " 3 3 2 , 3 3 3) or

which may result in a request by State authorities to provide federal troops in order to restore order (10 u.s.c. 331).

NDrE: The statutes cited provide three bases for the use of troops in connection with civil

disorders. Section 332 authorizes troops, at Presidential initiative, to enforce federal law and was the basis for the use of troops to protect the mail in the Pullman strike. Section 333 deals with

the use of troops to protect civil rights and enforce court orders and was the basis for using

370.

troops at permits the of a State

order, e.g.

Little Rock and Oxford. Section 331 President to send troops at the request when State authorities cannot restore the Detroit Riot.

D. Providing information relating to demonstration activities which are likely to require the federal government to take action to facilitate the activities and provide public health and safety measures with respect to those activities.

NOTE: While there is no specific ~tatutory

authority for collection of information 1n these circumstances, the Second Circuit recognized in Fifth Avenue Peace Parade Committee v. Kelley, 480 F.2d 326, cert. denied, 415 u.s. 948, that the

federal government has a legitimate need for information concerning demonstrations planned at federal facilities in order to provide services in connection with the demonstration. For example, considerable information was needed in order to

fashion an appropriate permit for the November 1971 moratorium march in Washington, D.C.

II. Criminal Offenses

A. Investigation of criminal offenses refer red to in paragraph I .A. shall be undertaken in the manner provided for in guidelines relating to criminal investigations generally.

B. Information concerning criminal offenses within the investigative jurisdiction of the FBI which is acquired incidentally in the course of implementing parts III through V, shall be handled in the manner provided for in guidelines relating to criminal

investigations generally. C. Information concerning criminal offenses within the investigative jurisdiction of another federal agency which is acquired incidentally in the course

of implementing parts II through V, shall be reported to the agency having jurisdiction.

D. Information concerning serious criminal offenses within the investigative jurisdiction of State or local agencies which is acquired incidentally in the course of implementing parts II through V shall be reported to the appropriate lawful authorities.

Note: Using the crit eria now applied by NCIC, the reference to serious offenses would exclude such matters as: drunkeness, vagrancy, loitering, disturbing the peace, disorderly conduct, adultery,

fornication, and consensual homosexual acts, false

371.

fire alarm, non-specific charges of investigation, traffic violations, delinquency.

suspicion or and juvenil e

E. Information relating to criminal offenses acquired in the course of implementing parts II through V shall be retained and indexed as provided for in guidelines relating to criminal investigatio ns generally.

III. Assisting the Secret Service -A. Information relating to the protect ive

responsibilities of the Secret Service described in Paragraph I.B, which is acquired incidentally by the FBI in the course of carrying out it s

responsibilities, shall be reported to the Secre t Service. The FBI shall not undertake specific investigations for the purpose of assisting the Secret Service in its protective responsibilitie s without a specific request from the Director of the Secret Service or his designee, made or confir med

in writing.

NOTE: The Department should undertake to review with the Secret Service existing agreements on the dissemination of information from the FBI to the Secret Service. The draft report of the General Accounting Office indicates that very little

information reported by the FBI is actually retained by Secret Service.

B. A record shall be made of all information reported to the Secret Service pursuant to paragraph III .A . and the record shall be retained by the FBI for five years.

NOTE: This is the standard Privacy Act accountin g requirement.

C. Information reported to the Secret Service may be retained by the FBI for a period of years.

NOTE: T he retention period for this informati on will be considered in a general review of retent ion under all the guidelines.

IV. Civil Disorders

A. Information relating to actual or threatened civil disorders acquired by the FBI from public officia ls or other public sources or in the course of its other investigations, shall be reported to the Department of Justice.

372.

B. The FBI shall not undertake investigations to collect information relating to actual or threatened civil disorders except upon specific request of the Attorney General or his designee.

Investigations will be authorized only for a period of 30 days but the authorization may be renewed, in writing, for subsequent periods of 30 days.

c. Information shall be collected and reported pursuant to paragraphs A and B above for the

limited purpose of assisting the President in determining whether federal troops are required and determining how a decision to commit troops shall be implemented. The information shall be based on

such factors as:

1) The size of the actual or threatened disorder both in number of people involved or

affected and in geographic area; 2) The potential for violence;

3) The potential for expansion of the disorder in light of community conditions and underlying causes of the disorder;

4) The relationship of the actual or threatened disorder to the enforcement of federal laws or court orders and the likelihood that State or local authorities will assist in enforcing

those laws or orders;

5) The extent of State or local resources available to handle the disorder.

D. Investigations undertaken, at the request of the Attorney General or his designee, to collect information relating to actual or threatened civil disorders shall be limited to inquiries of:

l) FBI files and indices;

2) Public records and other public sources of information;

3) Federal, State and local records and officials;

4) Established informants or other established sources of information.

Interviews of individuals other than above, and physical or photographic shall not be undertaken as part

investigation except when expressly the Attorney General or his designee.

37 3.

those listed surveillance of such an

authorized by

",

'∑

E. Information relating to civil disorders, described in paragraph C above, shall be reported to the Department of Justice and may also be reported to federal, state or local officials at the location of the actual or threatened disorder who have a

need for the information in order to carry out their official responsibilities in connection with such a disorder.

F. Information acquired or collected pursuant to paragraphs A through D above may be retained by the FBI for a period of years but may not be

indexed in a manner which permits retrieval of information by reference to a specific individual unless the individual himself is the subject of an authorized law enforcement investigation.

NGrE: Retention period to be fixed later; indexing limit to be implemented immediately. v. Public Demonstrations A. Information relating to demonstration activities

which are likely to require the federal government to take action to facilitate the activities and provide public health and safety measures with respect to those activities, which is acquired

incidentally by the FBI in the course of carrying out its responsibilities, shall be reported to the Department of Justice.

B. The FBI shall not undertake investigations to collect information with respect to such

demonstrations except upon specific request of the Attorney General or his designee.

C. Information collected and reported pursuant to paragraphs A and B above shall be limited to that which is necessary to determine:

1) The date, time, place and type of activities planned;

2) The number of persons expected to participate;

3} The intended mode of transportation to the intended site or sites and the intended routes of travel;

4) The date of arrival in the vicinity of the intended site and housing plans, if pertinent;

374.

5} Similar information necessary to provide an adequate federal response to insure public health and safety and the protection of First Amendment rights.

NorE: Clause 5 above is intended to encompass such additional facts affeting the federal

responsibility as unusual health needs of participants, counter-demonstrations planned which may increase safety needs, or possible inability of participants to arrange return transportation. D. Investigations undertaken to collect information

relating to demonstrations pursuant to paragraph B above shall be limited to determining the

information described in paragraph c. Such information shall be collected only by inquiries of:

1} FBI files and indices.

2) Public records and other public sources of information.

3) Federal, state and local records and officials.

4) Persons involved in the planning of the

demonstration, provided that in conducting interviews with such persons the FBI shall initially advise them specifica lly of the authority to make the inquiry and the limited purpose for which it is made.

E. The FBI shall not undertake to photograph any

demonstration or the preparation therefor in carrying out its responsibilities under paragraph v.

F. Information acquired or collected pursuant to paragraphs A through D above may be retained by the FBI for a period of years but may not be

indexed in a manner which permits identification of an individual with a particular demonstration or retrieval of information by reference to a specific individual, unless the individual himself is the subject of an authorized law enforcement

investigation.

NarE: Retention period limit to be

375.

to be fixed later; indexing implemented immediate ly.

APPENDIX G

ASIO'S RECORD HOLDINGS

1. Head Office records comprise:

(a) Personal files concerning individuals who are:

"

"

members of ASIO target organisations; ASIO targets in their own right (e.g. persons reportedly involved in .a terrorist incident);

members or representatives of certain foreign organisations who are visiting Australia; or under consideration or accepted for an operational role on behalf of an Australian intelligence agency.

(b) Sub~ect files on subjects

Inc uding organisations. of security interest,

(c) Headquarters testing files on per sons as soc ia ted with ASIO target organisations otherwise than through membership, or concerning persons otherwise of actual or potential security interest. The purpose of these files

is to enable ASIO to assess the security significance of the persons concerned.

(d) Positive vetting files are registered for all applicants for top secret clearance. They contain all the documents required to satisfy that clearance, . including a report of the interview with the applicant.

(e)

(f)

Access vetting files are for secret, confidential files are microf iched destroyed.

registered for all candidates and secure area access. These and the original documents

Protective Security Memorandum 10 3A vetting files were registered for the subjects of a special high level / / security clearance until September 1983 (when ASIO seemed to be responsible for carrying out suitability and background checking for those clearances) .

376.

(g) Personal Index comprised of cards or slips concerning Tnd1viduals and containing:

"

"

details of all the names by which an individual is, or has been, known;

identification particulars; ∑and

a reference to a file or files, either for that individual or on which traces of the individual may be found.

Should there be additional information in one of the Restricted Registries, the slips are appropriately stamped. The Personal Index, in common with other ASIO indexes, is not a record of adversely recorded individuals. It contains

references to all the individuals in whom ASIO has an interest including a non-operational interest, plus all subjects of security clearances.

(h) Subject indexes of cards or slips on subjects of security interest. (i) ASIO staff files

(j) Library material

(k) Photographs: photography is used as an aid in obtaining information about organisations and persons designated as ASIO targets in intelligence collection programs. Most photographs are taken by photographers based in

regional off ices but photographs in the following 'categories' are stored in ASIO's Head Office: " personal photographs supplied by non-ASIO sources non-personal photographs supplied by non-ASIO sources

photographs of persons, premises or objects taken by ASIO staff for operational purposes photographs of equipment, furniture, etc. taken for administrative purposes. (1) Warrant documentation files contain papers relating to

the obtaining and review of warrants by the

Attorney-General for the use of certain methods of intelligence collection.

2. Regional office records comprise:

(a) Target files contain information necessary to undertake reg1.onal operational commitmen ts and ma y only be opened with Head Office approval. T hey may be personal or subject files. Personal target files concern members of or persons associated in a signif icant way with ASIO

377.

target organisations. target organisations organisations.

Subject target files or branches or units of concern target

(b) Enquiry files which may be personal or subject, are used to hold information concerning:

"

"

unidentified persons of security interest individuals who are the subject of an inquiry from Head Office or another regional office organisations that are the subject of an inquiry to determine their security relevance organisations that are the subject of an inquiry from Head Office or another regional office once-only inquiries (such as interview for residence status) matters of short-term interest.

(c) Personal index maintained by each regional office, s1m1lar to that in Head Office, to provide a retrieval point for regional records through personal names. A regional office index may contain, in addition to direct

references to regional records, short precis of data and indicators that further information on a person is available from Head Office.

(d) Subject index which provides a retrieval regional records through information alphabetically according to subject. point for

arranged

(e) Telephone number, address, Post Office box number and vehicle registration indexes recording relevant details in relation to persons of interest to a regional office.

(f) Resources index listing people who are considered to be willing to provide assistance to ASIO in the performance of its functions.

3. Liaison office records comprise:

(a) Subject files (b) Personal files (c) Personal index (d) Subject index.

378.

APPENDIX H

FORM OF AGREEMENT BETWEEN THE COMMONWEALTH AND CERrAIN

sr ATES AND THE NORrHERN TERRITORY

RECITALS

AGREEMENT REGULATING THE RELATIONSHIP BETWEEN ASIO AND THE POLICE FORCE OF

A. Australian Security Intelligence Organization (ASIO) is a security intelligence organization. Its functions include the collection and assessment of intelligence relevant to security, as defined in the Australian Security Intelligence Organization Act 1979 (ASIO Act) , and to communicate that intelligence for

security purposes. B. The functions

its geographic co-operation with life and property

of the Police Force of are, within

jurisdiction, and, as appropriate, in agencies able to assist it, the protection of and the preservation of law and order.

C. Some information is of relevance to the functions of both ASIO and the Police Force. Other information is relevant to the functions of ASIO or to the functions of the Pol ice Force, but not to the functions of both.

D. It is appropriate to make an agreement providing for the exchange of information which is of relevance to the functions of ASIO and of the Police Force and for related matters.

1. In this agreement -(a) 'information' includes intelligence in any form;

(b) 'documents' includes photographs, tape recordings and any other record of information;

{c) 'terrorism' is as defined in the ASIO Act 1979;

(d) 'subversion' is as defined in the ASIO Act 1979.

2. Material which may be exchanged between the Police Force and ASIO.

ASIO and the Police Force may exchange material in areas of common interest, provided that such exchange is consistent with the ASIO Act and not in breach of State laws and falls within one or more of the following descriptions -

379.

(a) information concerning persons who have committed, or have aided and abetted or have incited the commission of, or who are likely to commit, or to aid and abet or to incite the commission of, any of

the following acts -

(b)

(i) espionage (ii) sabotage (iii) terror ism, or ( i v) subversion

including information relevant to the arrest and prosecution of those persons;

information relating to paragraph 2(a) which have likely to be committed; the acts described

been committed or in

are

(c) information relevant to the safety and protection of any person in respect of whom a Government has made, or might be expected to make, security

arrangements.

3. Additional material which may be provided by the Police Force to ASIO or by ASIO to the Police Force

(a) The Police Force may give to ASIO, on request,

information of the kind referred to in paragraph 2(a) hereof, or other information concerning criminal offences, in respect of any person concerning whom ASIO in the performance of its

functions under the ASIO Act has sought that

information.

(b) The Police Force may give to ASIO such information concerning vehicles as ASIO states that it requires for the purpose of carrying out its functions under the ASIO Act.

(c) ASIO may give to the Police Force information which has come into its possession in the course of performing any of its functions under the ASIO Act, and which relates, or appears to relate, to the commission or intended commission, within the geographic area of responsibility of the Police Force, of an offence against the law of the

Commonwealth or of the State, being an offence punishable by imprisonment for life or for a period, or maximum period, of not less than three years.

380.

4. Security, access and communications

(a) The Police Force shall not authorise any person to have access to any information provided to it by ASIO unless that per son has a need to have such

access to or to have knowledge of such information having regard to his duties as an officer of the Police Force or as a member or officer of the

Government of the State, or otherwise to carry out the laws of the State and in any event the Police Force shall not disclose that the information was supplied by ASIO unless that person has a need to

know the source of the information having regard to those duties.

(b) The Police Force shall hold any document regarding information provided to it by ASIO in such

containers or other holders or places and shall so control or record the movement and disposition of those documents that as far as possible it is ensured that no unauthorised person has access to

them or the information they record.

(c) The Police Force shall have due regard to the

provisions of the Commonwealth Protective Security Handbook in dealing with security classified material supplied to it by ASIO.

5. Use of Information by ASIO

ASIO shall not communicate any information received by it from the Police Force to any person, or allow any person to have access to any document recording the same, except in accordance with the provisions of the ASIO Act. AS IO shall observe the provisions of the Commonwealth Protective Security Handbook and

the classification and any caveats or limitations placed on information provided by the Police Force.

6. Other areas of co-operation between the Police Force and ASIO

(a} The Police Force and ASIO may, in order to avoid

duplication or compromise of their respective inquiries, consult with each other on matters of common interest concerning the obtaining of information of the type referred to in paragraph 2

above.

(b) As the result of such consultation, and in the proper exercise of their respective functions, the Police Force and ASIO may collaborate in obtaining information of the type referred to in paragraph 2

above.

381.

(c) The Police Force may, at the request of ASIO,

interview referees or other persons required by ASIO to be interviewed for. the purpose of preparing a security assessment in respect of an individual nominated by ASIO and may provide reports in

respect of those interviews.

(d) ASIO may provide the following services, materials or facilities for or to the Police Force -( i)

( i i)

(iii)

( i v)

training relevant to the carrying out of any activity necessary or appropriate for the collection of any information which pursuant to this agreement may be communicated to ASIO by

the Police Force,

special or technical equipment required for any of the purposes for which training may be

provided,

the use of scientific facilities controlled by ASIO insofar as that use is sought by the

Police Force in connection with any matter within ASIO's statutory functions, and

advice and training

security measures. concerning physical

7. Arrangements for co-ordination

The Director-General of Security may make arrangements with the Commissioner of the Police Force to co-ordinate the activities of ASIO and the Police Force in relation to any matter covered by this agreement. Such arrangements may include -

(a) the holding of conferences or seminars, and

(b) the entering into of any supplementary agreements (including any agreement authorising the payment of any money) provided they are -(i) not inconsistent with this agreement, and

(ii) approved respectively by the Minister administer ing the ASIO Act and the Minister subject to whose direction and control the Commissioner carries out his duties.

382.

APPENDIX I

OUTLINE OF OVERSEAS CHECKING PRACTICES

United States of America 1. In the United States security checking for access to Confidential and Secret material involves either a National Agency Check (in the case of members of the Armed Forces) or a National Agency Check with Inquiries (in the case of civilian

employees of the government) " A National Agency Check consists of a check of the fingerprint and investigative files of the Federal Bureau of Investigation and, where appropriate, the files of agencies such as the Off ice of Personnel Management,

the Department of Defence and the Armed Forces, the Immigration and Naturalization Service, and the State Department. A National Agency Check with Inquiries consists of checks of national agencies plus written inquiries to appropriate local police departments, former employers and supervisors, referees and

schools.

2. The security checking process for access to Top Secret information includes, with some variation between agencies, the following elements:

(a) verification of date and place of birth and citizenship

(b) a National Agency Check

(c) an in-depth interview of the subject

(d} a field investigation, covering at least the last five years of the subject's life, which involves record checks and a substantial number of personal interviews with current and former employers, neighbours and friends (including

unnominated referees)

(e) inquiries to local law enforcement and other agencies

(f} a report from a credit bureau.

3. In the case of access to what is termed in the United States Sensitive Compartmented Information (SCI), the minimum standards of security checking are as follows:

(a) verification of date and place of birth and citizens hip

(b) a National Agency Check on the subject and the subject's spouse

(c) a check of appropriate police records covering all areas of the individual's residence, employment and education in the u.s. throughout the most recent fifteen years or since age eighteen, whichever is the shorter period

383.

(d) verification of the individual's financial status and credit habits through checks of appropriate credit institutions and interviewß with knowledgeable sources covering the most recent f}ve years

(e) interviews with neighbours in the vicinity of all the individual's residences in excess of six months throughout the most recent five-year period

(f) confirmation of all employment during the past fifteen years and personal interviews with supervisors and co-workers at places of employment covering the past ten years

(g) verification of attendance at institutes of higher learning in all instances and at the last secondary school attended within the past fifteen years

(h) interviews with (a m~n1mum of

investigation) activities and years

a sufficient number of knowledgeable sources three developed during the course of the to provide a continuity of the individual's behavioural patterns over the past fifteen

( i) investigations of employment, education or residence in a foreign country

(j) a personal interview of the subject where necessary.

4. In addition to the above checking process, and depending on the employing agency, the candidate for SCI clearance may have to undergo psychiatric screening, psychological assessment and a polygraph examination. Possession of SCI clearance is a condition of employment in both the Central Intelligence Agency and the National Security Agency.

Sources:

David Martin, 1 Screening Federal Employees: A Neglected Security Priority', (Critical Issues}, The Heritage Foundation, Washington, 1983.

Guenter Lewy, 'The Federal Loyalty - Security Program: The Need for Reform', The American Enterprise Institute for Public Policy Research, Washington, 1983.

United States of America, House of Representatives, Ninety-sixt h Congress, First Session, Hearings before the Sub-committee on Oversight of the Permanent Select Committee on Intelligence, May 16,17, 24 and June 21, 1979, 1 Pre-employment Security Procedures of the Intelligence Agencies', US Government Printing Office, Washington 1980.

United States of America, House Report, Sub-committee on Oversight, of Representatives, Staff Permanent Select Commit tee

384.

on Intelligence, 'Security Intelligence Agencies', US September 1979.

Clearance Government Procedures Printing

in the

Office,

Canada 5. The Commission of Inquiry Concerning Certain Activities of the Royal Canadian Mounted Police outlined the vetting procedures time, a Top Secret clearance

procedures:

in its Report of August 1981 applying in Canada. At that required three investigatory

(a) a check of Security Service files for information on the candidate, his relations and close associates

(b) a fingerprint check of Royal Canadian Mounted Police criminal records

(c) a field investigation, involving contact with neighbours, employers and educators and a credit bureau check.

6. Clearances for Secret and Confidential required only the first two of these procedures, although a field investigation could be initiated for cause.

7. The Canadian Commission proposed changes to this system. It was recommended that, for a Secret clearance, the candidate be interviewed, and that for a Top Secret clearance the candidate and three nominated referees be interviewed.

United Kingdom B. The U.K. has had for over 30 years a system known as

positive vetting to investigate the reliability of those who are expected to have regular access to highly classified

information. The system involves the interview of the candidate for clearance, character referees and supervisors.

Sources:

'Statement on the Recommendations of the Security Commission', Command 8540, HMSO, London, 1982.

'Report of the Security Commission May 1983 1 , Command 8876, HMSO, London, 1983.

385.

APPENDIX J

NON-ACCESS SECURITY CHECKING STATISTICS

Immigration checking by ASIO liaison officers on overseas posting Table (a}

ASIO liaison officers on overseas postings Immigration checking statistics

Year ended 31 December

Security Interviews

Check requests to liaison services

Recommendations against migrant entry

Security information obtained and forwarded to Head Office

Table (b)

1981

7,815

46,517

23

3 73

1982 1983

6,212 3,425

41,568 38,880

27 17

191 190

Immigration check requests processed by ASIO Head

Year ended 31 December 1981 1982 1983

Applications for temporary 5,975 5,934 6,450 entry

Recommendations against 23 15 14

entry

Applications for resident 11,747 7,748 9,270 status and extension of stay

Citizenship applications 74,109 92,102 77,826 Applications for refugee 54 125 34

status

386.

1984 (to June)

1,901

19,183

3

119

Office

1984 (to June)

3,228

10

3,101

1

Table (c)

Interviews conducted by ASIO Regional Offices in relation to applications for resident status and extensions of stay

Year ended 31 December 1981 1982 1983 1984

(to June)

Interviews 433 599 414 107

Table (d)

Qualified or adverse assessments in relation to grant of change of residence status

Year H

1980/81 1981/82 1982/83 1983/84

Qualified Assessments Adverse Assessment

1.7.84 - 30.9.84

5

5

3

0

1

11

7

1

0

1

Table (e)

Year

1979/80 1980/81 19 81/82 1982/83 1983/84 1.7.84 -

TOTAL

Findings of the Security Appeals Tribunal in passport and immigration cases

Appeals to Upheld

SAT

1 1

3 3

1

30.9.84

5 4

387.

Total

16

12

4

0

2

Dismissed

1

1

APPENDIX K

SECUR ITY APPEALS TRIBUNAL STATISTICS

NUMBER OF APPLICATIONS RECEIVED SINCE COMMENCEMENT

YE AR OF OPERATION APPLICATIONS RECEIVED

QUALIFIED ADVERSE TarAL

1979-1980 Nil Nil Nil

1980-1981 2 2 4

1981-1982 5 4 9

1982-1983 4 6 10

1983-1984 7 Nil 7

18 12 30

388

SUMMARY OF RESULTS OF APPLICATIONS PROCESSED

Qualified Adverse Total

NUM BER PROCESSED 18 12 30

Level of Clearance

Top Secret 6 1

Sec ret 6 5

Confidential 4 1

Citizenship & Passport 2 4

Access to Premises 1

TarALS 18 12 30

Summary of Grounds

Uncheckable background 9

Possibility of pressure 5 on families living abroad Involved in subversion or 2 12

politica lly motivated violence Association with foreign 1

power Use of marihuana 2

TarALS 18 12 30

389

Qualified Adverse Total

Results " Application dismissed 1 5

" Application granted 8 6

" Assessment justified 3 1

but no grounds for denying access

Adjourned indefinitely 5 or withdrawn

" New case 1

TarALS 18 12 30

390

APPENDIX L

LAW AND PRACTICE IN RELATION TO REVIEW OF

SECURITY ASSESSMENTS

1. The law and practice as to the .power of any appeal or review tribunal to reverse the refusal by the head of an agency to grant a security clearance, and the effect of any findings by the SAT in respect of such a clearance, are obscure and confused.

2. Before the coming into force of the Public Service Acts Amendment Act 1982, promotions and transfers within the public

service, and appeals in relation to them, were dealt with in ss. 50 and following of the Public Service Act 1922. There appears

to have been no provision for appeals in respect of transfers other than in cases involving the temporary performance of duties under reg. 116. In the selection of officers for promotion, s. 50 (3) required that consideration should be g iven

to the relative efficiency of officers available for promotion to the vacancy. With the approval of the Board an agency head might determine that for this purpose 'efficie ncy' should mean special qualifications and aptitude for the discharge of the duties of the office to be filled, togethe r with me rit,

diligence and good conduct. Not much, if any, use appears to have been made of this provision. An appeal might be had to a Promotions Appeal Committee on the ground of superior efficie ncy or equal efficiency and seniority.

3. The provisions relating to promotions were amended by the Public Service Acts Amendment Act 1982. In the selection of an

officer for promotion to a vacancy , ccns ideration shall now be given only to the relative efficiency of the officers available for promotion to the vacancy (s. SOA (1)). 'Efficiency ' is defined to mean the suitabilit y of the officer for the discharge

391.

of the duties of the kind to be performed in the vacant office concerned, having regard to certain specified matters, the only relevant ones being the capability of the officer to discharge those duties, and any personal qualities of the officer relevant to the discharge of those duties (s. 50A(2)).

4. The refusal by the head of an agency of a security

clearance, which is effected by the Department Secretary signing a printed form, does not seem to be encompassed by the term

'personal qualities', although matters which led the agency head to make the decision may include those qualities. It is debatable whether the refusal of a security clearance can be included within the description 'the capability of the officer to discharge those duties'. In my opinion it is not included, but the matter is arguable.

5. If the view I have just expressed is correct, then there is no law of the Commonwealth providing for an appeal or review

from the decision of an agency head to refuse a security

clearance, even if the granting or withholding of a security clearance is part of a decision about promotion. If the decision about a security clearance is a separate decision, distinct from and not part of a decision about promotion {as I believe to be

the position), it is quite clear that there is no appeal from such a decision.

6. This conclusion accords with the practice laid down in the Personnel Assessment Manual issued by the Public Service Board which deals with personnel assessment procedures and guidelines for persons having access to national security information or secure areas. As well as dealing with police records checks, the Manual deals in detail with personal characteristics affecting

loyalty and reliability, intoxicants and drugs, employment history, and the like. Having dealt with these matters, the Manual prescribes the procedures to be followed where an applicant for promotion is being considered for placement in a security assessment position and the Department is satisfied, on

392.

the basis of the available information, that the person is reliable and trustworthy. It is only after being so satisfied that a request is to be made by the Department to ASIO for a security assessment (para 24). The decision as to a security clearance would normally be made after receipt of ASIO's

assessment.

7. Substantially the same approach paragraphs of the Manual which ∑deal is adopted by those

with Promotion Appeal

Procedures. Where a Promotion Appeals Committee (PAC) concludes that an appeal against a promotion under s. 50 or for selection for temporary performance under reg. 116 should be upheld in relation to the filling of a position identified as a security assessment position, the PAC will record its conclusion but note that it is subject to a security clearance. The chairman is not

to proceed to confirmation stage, but advises the Department about the Committee's conclusion and seeks advice on security clearance.

8. It is expressly stated that it is considered desirable for the PAC clearly to separate its conclusion based on its inquiries from the question of clearance for access. If the intended successful applicant does not have a current security clearance of the necessary kind, the designated officer in the Department is to consider the suitability of the prospectively

successful appellant for access to national security information having regard to the guidelines in the Manual about, inter alia, police records and personal characteristics affecting loyalty and reliability. He then takes the necessary steps to get an ASIO assessment in respect of the appellant. Where, after

considering the ASIO assessment the agency head proposes giving clearance for access, the Department should convey its decision on access to the chairman of the PAC, who will then take the

necessary action to finalise the promotion appeal.

9. Appropriate provision is made for cases where the ASIO assessment is adverse or qualified. It is then said that the

39 3.

final decision as to whether a promotion appeal is to be allowed rests with the PAC, but in the event of the Department not giving clearance for access, the officer could not be regarded as efficient for the duties involved and an appeal could not therefore be upheld (para 27).

10. Paragraph 27 goes on to deal with the situation where the ASIO assessment is adverse or qualified and an appeal is lodged

to the SAT. Among other things, it states that following the resolution of the appeal, the decision of the SAT as to the security issue is binding both on the Department and the PAC, and that the Department should convey the decision of the SAT directly to the chairman of the PAC who will then proceed to

take the action which necessarily follows from the SAT decision.

11. In order to decide whether this automatic effect of the findings of the SAT is the consequence of the provisions of the ASIO Act, it is necessary to look in some detail at s. 60(1) and

s. 61(2) and the definition of 'prescribed administrative action' in s. 35.

12. Section 61(2) provides that where there has been an appeal to the SAT, its 'findings' on a relevant review of ASIO's assessment are binding on the PAC and the head of the agency in the making of a decision in respect of prescribed administrative action or in exercising powers in or in connection with an appeal or review in respect of such a decision respectively.

13. Since there is no appeal against the refusal of a security clearance, s. 61(2) is of relevance to the question I am discussing only if a decision in respect of promotion is a decision in respect of prescribed administrative action. So far as relevant, that expression means action that relates to or affects access by a person to any information or place access to which is controlled or limited on security grounds, including action affecting the occupancy of any position under the Commonwealth, the occupant of which has or may have any such

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access. Occupancy of a position under the Commonwealth does not in itself give access; access is afforded by a security clearance. However there are positions to which duties are attached which involve access, so that if the occupant of such a position does not obtain a security clearance, he will have to

transfer to another position, or the duties of the position will have to be changed.

14. On one view, the refusal of promotion for lack of a

security clearance is not prescribed administrative action. However if this were so, the words in the definition relating to the occupancy of Commonwealth offices or positions would appear to be meaningless. The definition should accordingly be

construed to bring within its scope a refusal of promotion in such a case. On this construction of the definition, although an appeal does not lie from the refusal of the security clearance, a promotion appeal in respect of a position the occupant of

which requires a security clearance to carry out his duties is an appeal against a decision in respect of prescribed

administrative action within the meaning of s. 61(2).

15. It is accordingly necessary to determine what are the findings of the SAT which are binding on the PAC and the head of the agency. To determine this, it is necessary to look at s. 60 (1). That sub-section provides that upon a conclusion of a

review the Tribunal shall make and record its findings in relation to the ASIO assessment, and those findings may express the opinion of the Tribunal as to the correctness of any opinion, advice or information contained in the assessment or as

to the question to which the assessment relates. The effect of s. 61(2) making binding the SAT's findings depends upon what is validly included in its findings pursuant to s. 60(1).

16. To put this question in context, it is necessary to refer to Chapter 9 where it is pointed out that the responsibility of an agency in relation to giving a security clearance is wider than the responsibility of ASIO in giving a security assessment.

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In particular, the matters to which the agency can have regard are not limited to those matters which may be relevant to security within the definition of that word in s. 4 of the ASIO Act, but extend to character and related defects which may

establish disloyalty. or indicate unreliability, but not necessarily

17. Thus the fact that a person is given to talking too freely about confidential matters or lacks adequate discipline in relation to the handling and control of classified documents may not go to security within the limited meaning of that word in s. 4 of the ASIO Act, but may go to the matters which the agency

has to consider in a decision on the question whether a

particular officer should be given access to particular categories of classified information, documents or places.

18. This view is abundantly confirmed by the provisions of the Public Service Board " s Personnel Assessment Manual that I have referred to. It is apparent from the provisions of that Manual that, although many matters may have to be considered both by the relevant agency head and by ASIO, the agency head may be required and is certainly entitled to have regard to matters outside the scope of those matters which ASIO or the SAT can

rely upon in the making of a security assessment.

19. Under s. 60(1), the SAT may make various kinds of findings. It may confirm or reject conclusions of fact made by ASIO and relied upon by it in the making of a security assessment; it may confirm or reject ASIO's conclusion upon the facts which is contained in the assessment; but in accordance with the last words of the sub-section, " or as to the question to which the assessment relates', the findings may express the opinion of the Tribunal as to whether a security clearance should or should not

be granted to an officer to the extent that that question is a question to which the assessment relates. However the assessment can relate to the granting or withholding of a security

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clearance only to the extent that the clearance is based on information or matters relevant to security in the sense defined in s. 4 of the ASIO Act.

20. Unless the findings include a statement of the latter kind, the findings of the SAT which are binding upon the agency head or the PAC are its findings of fact and its opinion or advice as to the conclusion which should be reached upon those facts. The findings would not bind the agency head or the PAC in reaching a conclusion as to the giving or withholding of a security clearance based on facts, relevant to that decision, in whole or

in part outside the scope of the issue before the SAT. That issue must be one relating solely to security within the meaning of s. 4 of the ASIO Act.

21. What then is the position when the SAT's findings include the expression of an opinion as to the question of the granting of a security clearance to which the assessment relates? Upon the basis that the view which I have expressed that the

'security' with which ASIO and the SAT are concerned is a more limited concept than the 'security' with which the agency head is concerned is correct, in my opinion the proper construction of s. 60(1) is that the SAT is not entitled to express an opinion upon a matter falling outside the 'security' with which

it has jurisdiction to deal. Any purported finding in respect of, or based in whole or in part upon, those aspects of security with which it has no jurisdiction to deal (although relevant for the purposes of the agency head) , is made without power and is

not an opinion as to the question to which the assessment relates.

22. If this be the correct construction of ss. 60 (1) and 61(2), what is binding on the agency head, and on the PAC, is the

precise content of the findings of the SAT in so far as they relate to security as defined in s. 4 of the ASIO Act. If the agency head's conclusion as to the granting or withholding of a security clearance is based solely upon grounds covered by

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findings of this kind, and the SAT's advice, expressed in its findings, was that a security clearance should be granted, the agency head would be bound to grant a clearance.

23. If on the other hand the agency head's conclusion is based wholly or partly on matters outside the scope of the SAT's findings, or outside any findings relating to security within the ASIO Act sense, then the agency head would be bound to have regard to the SAT's findings, but would nonetheless be entitled to come to his or her own decision as to whether a security clearance should be granted.

24. On the views I have expressed, it would never be relevant for the PAC to consider the effect upon it of the SAT's

findings, for the issue whether a security clearance should be granted or refused is not before it, but is a matter for the agency head.

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