6.1
Evidence to this inquiry suggests there would be significant benefits to Defence, the Government and the Australian people by enriching and deepening bipartisanship through parliamentary engagement on defence policy.
6.2
As discussed in chapter 4, the Committee recognises that adoption of bipartisan defence agreement models in Denmark and Sweden would constitute a fundamental change to the exercise of Executive government in Australia. The Committee heard much greater support for improving parliamentary oversight of and engagement with defence and agrees that this would facilitate better informed parliamentary and public debate and discussion on defence policy.
6.3
This chapter proposes a new statutory model for enhancing parliamentary engagement with Defence. The Committee considers that this model will provide opportunities for greater bipartisan appreciation and understanding of defence issues and will lead to better policy outcomes.
Improving Parliamentary engagement
Benefits of increased parliamentary engagement
6.4
The Committee heard that greater bipartisan engagement between the Parliament and Defence would improve awareness, scrutiny and debate of defence policy and key questions of national security. It would also increase public confidence in the Australian Parliament’s oversight of Defence.
6.5
In a 2015 paper, former Senator and Chair of this Committee, Professor Russell Trood, together with Mr Anthony Bergin from the Australian Strategic Policy Institute (ASPI), argued that enhancing parliament’s role in national security and defence would:
… reinforce Executive accountability, expand public access to policy processes, improve the quality of public debate about national security and help to strengthen the foundations of Australia’s parliamentary democracy.
6.6
Professor Trood and Mr Bergin argued that the parliamentary committee system is the best mechanism for this engagement:
In this system, partisanship often seems to be forgotten, or at least put to one side (albeit temporarily), as senators and members summon their better angels to focus on the national interest and reach policy positions through consensus and agreement.
6.7
Dr Andrew Carr from the ANU’s Strategic and Defence Studies Centre urged the Committee to ‘recognise and promote the importance of parliamentary debate as a strategic necessity and proven democratic strength for shaping Australian defence policy’. Dr Carr told the Committee that parliamentary committees, like the Defence Sub-Committee, could play an important role in leading and encouraging this debate:
I'd love to see greater involvement from the committee—I'm a great believer in the committee system—greater parliamentary involvement, speeches, discussions and engagement with local community. There could be a great role for these political debates out in the public and reflecting what is already happening behind closed doors within Defence.
6.8
The Committee agrees that Defence would benefit from increased parliamentary engagement. Amongst the positive outcomes would be better informed Members and Senators on the complexities of Defence. As discussed in chapter 4, evidence from overseas models indicates that educating parliamentarians assists them to become producers, rather than consumers of defence policy. It would allow parliamentarians to contribute to defence planning, and ensuing bipartisan support for long-term strategic goals.
6.9
Enhanced parliamentary engagement would also result in greater transparency and public awareness of defence issues, where appropriate. The Committee recognises that not all issues are appropriate to discuss in a public forum and must be handled confidentially.
6.10
The Committee agrees that the Committee system is the best and most appropriate mechanism through which the Parliament can better engage with Defence. As discussed in its Review of the Defence Annual Report 2015-16, the Committee considers that parliamentary committees ‘can, and should, provide greater oversight of and support for long term reforms’ to implement the First Principles Review, including capability planning.
Barriers to improving parliamentary engagement
6.11
The Committee notes there are a number of barriers to improving parliamentary engagement with Defence, namely lack of access to relevant information, lack of focus and coordination by existing parliamentary committees, and the need for agreement by the Executive. These barriers are outlined below.
Transparency and access to relevant information
6.12
This inquiry has highlighted that one of the key barriers to improving parliamentary engagement is access to relevant information, especially classified and commercial-in-confidence information. As discussed in Chapter 3, defence industry representatives and policy experts suggested that political and public discussions on defence policy would be enriched by greater transparency and access information such as the industry ‘scorecards’ and regular updates to the Integrated Investment Program (IIP).
6.13
The Committee notes that the changing nature of Australia’s national security environment since 2001 has broadened the range of activities undertaken by Australia’s intelligence agencies, including increasing integration with Defence operations and capability planning. The Prime Minister’s 2017 Independent Intelligence Review found that the range of activities of intelligence agencies now include:
… support for the planning and conduct of military operations, including information on the weapons systems and defence technologies of potential adversaries or of those countries developing, manufacturing and exporting such capabilities.
6.14
As a result, the sharing of information on Defence strategic policy has become increasingly problematic. Defence documents that look to implement policy direction from Government are all classified and include Defence Planning Guidance, Australia’s Military Strategy and quarterly and annual Strategic Reviews. Without detailed information on strategic policy and how it was arrived at, then the need for capability and subsequent funding will always be in question by the Parliament. As it currently stands, the Parliament is limited to providing input on only a part of what Defence does.
6.15
Similarly, the Parliament faces similar barriers in accessing information relating to the commercial relationships between Defence and its industry partners. Through the IIP and Defence Industry Policy Statement, Defence is working more and more closely with defence industry to deliver the capability upgrades set out in the White Paper. The Committee recognises the importance of classifying details on capability acquisition and the progress of capability projects as ‘commercial-in-confidence’ to protect the interests of Defence’s industry partners.
6.16
However, like strategic information, the Committee is concerned by the lack of information available to the Parliament on capability projects classified as ‘commercial-in-confidence’.
6.17
The Committee notes that a number of commentators have highlighted how the lack of transparency and access to information limits the effectiveness of parliamentary oversight of defence and national security. In her 2005 analysis of the role of parliamentary committees in the scrutiny of foreign affairs and national security policy, Australian Parliamentary Fellow, Dr Kate Burton, found that committee inquiries:
… are limited in their ability to shed much light on policy processes in general, and especially in relation to those behind politically or security sensitive foreign policy issues.
6.18
Dr Burton argued that ‘secrecy’ is the key reason for the limitations on the effectiveness of committee scrutiny and public debate:
… the power of national security, and the secrecy that so often attaches to it, to stifle debate and the tendency for committee members to allow themselves to be caught up in this silencing. Given the vested interests of governments and oppositions in maintaining a certain silence in these areas, there is little prospect that committee inquiries will perform a more robust scrutiny role.
6.19
Due to these limitations, Dr Burton, like many commentators, questioned the ability of parliamentary committees to influence foreign and defence policy. Similarly, former Executive Director of the Lowy Institute for International Policy, Professor Allan Gyngell, and Professor Michael Wesley have argued that in relation to foreign policy, ‘it is hard to find any significant role played in the formulation of Australian foreign policy by Federal Parliament’, including by this Committee.
6.20
Evidence to this inquiry suggested that greater transparency could lead to more informed political and public debate and raise the profile and understanding of defence policy in Australia. Dr Andrew Davies from ASPI told the Committee:
… defence is rarely an election issue. If there were greater transparency and a greater understanding of it, I think there would be much more chance of it being an active part of the discussion in the run-up to an election.
6.21
Similarly, Raytheon Australia highlighted the importance of increasing transparency to improve political debate:
The best way to encourage a shared political position on defence capability is to ensure that transparency in the capability plan is maintained. One of the reasons why parliamentary committee deliberations get bogged down on these issues is that the level of understanding on the part of committee members of defence capability is often low. Maximum possible transparency would lead to a more mature political discussion on capability and generate a more informed level of debate.
6.22
Raytheon Australia suggested there is ‘considerable merit’ in taking ‘whatever steps are appropriate to better inform the Parliament and the public on the way Australia’s defence procurement process works and the nature of the capability being acquired for the Australian Defence Force’. In relation to the company scorecards, Mr Gerry Wheeler told the Committee:
I think a committee such as this should be provided with that sort of detail so they can be better informed about the performance of companies in significant tenders … the problem is that very few people see them and I think it would be a great thing for this committee, and certainly for the National Security Committee, to regularly see these documents.
6.23
The release of classified documentation is further complicated by the lack of security clearances for members and Senators. Mr Gerry Wheeler from Raytheon Australia proposed the ‘radical idea’ that Members and Senators on certain committees be vetted for security clearances.
6.24
Officials from Defence highlighted that releasing information on defence strategy and capability to the parliament and public is ‘a very complex and difficult issue’ due to its classified nature. Air Vice Marshal Mel Hupfeld told the Committee:
If we are going to start to talk about readiness and preparedness—and indeed as soon as we start to discuss sustainment in a public forum—we will very quickly end up in a classified area.
6.25
Defence officials explained that releasing documentation on how Defence uses strategic assessments to determine capability requirements further risks revealing classified information:
Once we started to get into generic statements such as X number of wars or X number of fronts, with our situation or circumstance … it would be difficult for us to start to articulate … those types of things without getting into revealing what we're thinking, what we're prioritising, what we're making more ready and on what grounds.
6.26
The Committee’s recent Review of the Defence Annual Report 2015-16 highlighted the challenges faced by the Defence Sub-Committee in accessing the classified information necessary to monitor the implementation of Defence’s reform programs, particularly the First Principles Review. The Committee’s review highlighted the need for ‘greater transparency and streamlined reporting’ and recommended that Defence:
… must do more, both in public and classified material (Committee-in-Confidence), to enable the Parliament and external stakeholders to understand and provide oversight of one of Government’s largest expenditure programs.
6.27
The Committee notes that the Joint Committee of Public Accounts and Audit (JCPAA) identified the same challenges in its recent report on Defence Sustainment Expenditure. Like this Committee, the JCPAA highlighted the need for Defence to improve transparency in its public reporting and recommended that Defence improve the published performance indicators set out in its Corporate Plan, Annual Report and Portfolio Budget Statements to allow for ‘clear and easy scrutiny of sustainment expenditure’.
6.28
The JCPAA also highlighted that Defence is yet to clearly articulate the changes that have arisen from the First Principles Review (FPR). Like this Committee, the JCPAA recommended that Defence provide progress reports on the implementation of the FPR and ‘detail of the positive changes that have been realised to date’.
6.29
The Committee notes that the Parliament has previously addressed the challenge of accessing classified information in relation to national security policy. This issue is considered further below.
Lack of focus and coordination of existing Committees
6.30
Defence is currently subject to scrutiny by a number of parliamentary committees. As this Committee has previously noted, since July 2013, there have been over 45 reviews of Defence’s performance, including many by parliamentary committees.
6.31
The Committee recognises that there is a lack of coordination between these committees in how they engage with Defence which imposes a significant workload on Defence. As noted this Committee has recently acknowledged:
… the current reporting regime the Department of Defence is directed to meet is disaggregated and cumbersome; resulting in no single identity or organisation being responsibility for oversight of the Department.
6.32
The Committee also recognises that each of the existing committees has responsibility for different aspects of the Defence portfolio, which may lead to overlap and duplication. This overlap was recently highlighted by the findings of the JCPAA’s report on defence sustainment expenditure, which made very similar findings and recommendations as this Committee’s Review of the Defence Annual Report 2015-16.
6.33
The role and limitations of the existing committees with responsibility for the Defence portfolio are outlined below.
Joint Standing Committee on Foreign Affairs, Defence and Trade
6.34
Since 1973, Defence has been subject to scrutiny by this Committee. The then Prime Minister, the Hon Gough Whitlam MP, told the House that expanding the role of the former Joint Committee on Foreign Affairs to cover the Defence portfolio indicated his Government’s ‘desire to give Parliament its proper role in the study of two important areas of national interest and concern’:
It is our hope and intention that the new Joint Committee will come to play an active and useful part in the national debate on important issues of foreign affairs and defence … Our decision to establish an effective new Joint Committee reflects therefore more than simply a desire to make members better informed about foreign affairs and to promote public debate on foreign policy. It is also a demonstration that this Government is serious in its wish to enable Parliament to make a more significant contribution to the study of national issues.
6.35
Through the Defence Sub-Committee, this Committee has undertaken a number of significant inquiries into issues across the Defence portfolio, including regular inquiries into the annual reports of the Department of Defence since 2001.
6.36
The Committee notes that the Defence Sub-Committee has recently adopted a new methodology to ‘achieve better longitudinal parliamentary oversight of the Department’s performance’ through future annual report reviews. These issues will be examined in detail in the Committee’s current review of the Defence Annual Report 2016-17.
Senate Legislation and References Committees
6.37
Senate Committees perform an important role in the scrutiny of the Government, Ministers and their departments. The modern Senate Committee system was established in 1970 with the establishment of seven general purpose standing committees and five estimates committees. The system was further refined in 1994 to amalgamate the general purpose and estimates committees into paired references committees (to examine issues referred by the Senate) and legislation committees (to examine legislation and conduct estimates hearings on budget expenditure).
6.38
The Senate Foreign Affairs, Defence and Trade Legislation and References Committees have the primary responsibility for the scrutiny of Defence, including Senate estimates hearings. Other committees may also conduct inquiries into aspects of Defence’s administration, where it overlaps with the portfolio responsibilities of those committees.
6.39
Submitters suggested that Senate Committees could contribute more effectively to the development of Defence policy. Mr Gerry Wheeler from Raytheon Australia, suggested that Senate Estimates Committees could make ‘an enormous contribution’ to scrutinising defence capability planning:
I think we underestimate what influence some of the parliamentary committees could have … Those sorts of forums, where a raft of senior Defence officials are before a parliamentary committee, are where you can get genuine information and discussion about defence capability in particular.
6.40
However, Senate Committees face the same challenges as this Committee in accessing sensitive and classified information. These Committees are particularly limited as Senate Standing Order 26(2) requires that Senate Legislation Committees hear evidence on estimates in public session. The Committee also notes that the adversarial nature of estimates hearings would not be an appropriate forum in which to discuss this kind of information.
Parliamentary Standing Committee on Public Works
6.41
The Parliamentary Standing Committee on Public Works (PWC) is a statutory committee first established in 1913 and constituted by the Public Works Committee Act 1969. The PWC is empowered to inquire into all Commonwealth public works estimated to cost more than $15 million, as well as any other public work referred to it. Due to the commercially sensitive nature of many public works projects, the PWC regularly takes evidence in-camera.
6.42
The PWC regularly undertakes inquiries into public works relating to Defence’s estate. The PWC is limited to examining the need and cost-effectiveness of public works proposals and does not examine broader defence policy or the management of the Defence estate generally.
Joint Committee of Public Accounts and Audit
6.43
The JCPAA is a statutory committee first established in 1913 and constituted by the Public Accounts and Audit Committee Act 1951. The JCPAA is responsible for examining Commonwealth expenditure and reports of the Auditor-General.
6.44
The JCPAA examines a number of issues relating to Defence expenditure and relevant reports by the Auditor-General, including the annual Defence Major Projects Report.
Parliamentary Joint Committee on Intelligence and Security
6.45
Some aspects of the intelligence functions of Defence, such as the Defence Intelligence Organisation (DIO) are also subject to scrutiny by the Parliamentary Joint Committee on Intelligence and Security (PJCIS). The role and functions of the PJCIS are examined in detail below.
Agreement of the Executive
6.46
As discussed in chapter 2, the formulation of defence policy is the prerogative of the Executive. The Committee heard that advice from parliamentary committees is just one of many inputs to consideration by the Executive. Dr Davies from ASPI told the Committee:
… the executive is the executive; it will make decisions. A joint committee can say, 'Here are a range of bases we think you should close,' and the government of the day will make a decision based on a whole series of inputs, one of which is the input of that committee. They also have an eye on the electorates that every base is in.
6.47
In her 2005 analysis, Dr Burton also highlighted that the scrutiny of parliamentary committees on foreign and national security policy is limited by ‘the executive’s ability to manipulate mechanisms designed to enhance its accountability to parliament’. Dr Burton highlighted that in the adversarial relationship between the Executive and the Parliament, ‘information is power’:
The executive wants to make and implement policy with minimal interference from parliament. It is therefore likely to try to keep parliament in the dark about its activities. For its part, parliament’s primary means of holding the executive to account—and the opposition’s means of scoring political points—is itself to be as well informed as possible, as well as to obtain information that demonstrates any maladministration, policy failure or other government blunder.
6.48
Perhaps the greatest challenge is the political question of seeking agreement from the Executive to allow greater scrutiny of defence policy. Former VCDF, Lt-Gen Mueller suggested that any PJCIS-type role would need to be considered by the Executive:
… that is going to be a political judgement. It's one that's going to be made by the executive. The executive … jealously guards its policy advice that it gets from its departments. It also doesn't want to have its policy options unnecessarily constrained. My suggestion would be that that's a discussion that needs to take place between this committee and the executive.
Committee view
6.49
The Committee recognises that the existing models for parliamentary committees to engage with Defence face challenges in accessing information, a lack of focus and coordination and lack of cooperation from the Executive.
6.50
The Committee acknowledges and affirms that the Executive does and should maintain the prerogative to make and implement Defence policy. However, as this inquiry has highlighted, the Committee considers that bipartisan engagement between Defence and the Parliament could help to better support the Executive’s strategic objectives in the long-term and improve parliamentary and public debate on the importance of Defence to Australia’s future.
6.51
The Committee notes that the existing parliamentary committees, including this Committee, are limited in their engagement with Defence, particularly by their inability to access the classified and sensitive information required to provide adequate well-informed parliamentary oversight of Defence. Due to these significant barriers, meaningful and well-informed engagement with Defence is limited.
6.52
The Committee considers that a high security classification or commercial-in-confidence shouldn’t be used as a veil to prevent or obstruct parliamentary scrutiny of Defence strategy, capability planning, investment decisions and expenditure.
6.53
To improve parliamentary engagement, the Committee proposes the establishment of a new statutory committee with clearly defined functions and powers to access the necessary information, as outlined below.
Proposal for a new, statutory Defence Committee
Precedents for a statutory committee
6.54
The Committee notes that similar barriers to parliamentary engagement identified by this inquiry in relation to Defence have been previously been identified in relation to Australia’s intelligence agencies. The 1995 Commission of Inquiry into the Australian Secret Intelligence Service (ASIS) (Commission) found that the ‘main difficulty in achieving fully the advantage of parliamentary accountability for ASIS’ was ‘the necessity to preserve a high level of secrecy about the activities of the Service’. The Commission heard that ‘the objective of bipartisan political support for the arrangements for control and accountability [of ASIS] would be advanced by the existence of a parliamentary committee’.
6.55
To overcome these barriers, the Commission recommended the establishment of a new statutory committee with a clear legislative mandate to oversee ASIS with provisions allowing committee members to access to sensitive classified information. The Commission argued that:
Parliamentary oversight through a special committee is the appropriate vehicle for ASIS because of the sensitivity of the issues involved and the associated need to ensure the security of information provided. The Government could not, in practice, share much of the information necessary to accountability with the whole Parliament nor could that information be published. Parliamentary questioning of ministers and debate on intelligence matters will necessarily be limited for this reason. Under appropriate security arrangements, however, a committee could be provided with fuller information. Oversight by a committee would, moreover, be consistent with the general approach to public sector accountability in Australia and in other parliamentary democracies.
6.56
The Commission considered that this model would ‘substantially strengthen the accountability of the Government’ and ‘lead to the development of specialist expertise on the part of committee members, a factor which is important to any effective parliamentary oversight’.
6.57
These recommendations formed the basis of the Intelligence Services Act 2001 which established the Joint Parliamentary Committee on Intelligence and Security (PJCIS). The key features of the PJCIS are outlined below.
Joint Parliamentary Committee on Intelligence and Security
6.58
The PJCIS is a statutory committee first established in 2001 to provide oversight over Australia’s intelligence agencies. The predecessor to the PJCIS was first appointed in 1988, following the then Government’s response to the 1983 Royal Commission on Australia’s Security and Intelligence Agencies which argued that existing oversight and accountability measures could be improved by:
… directly involving the Parliament–on both sides and in both Houses–in imposing the discipline of an external scrutiny of the intelligence and security agencies quite independent of the Executive.
Role and functions of the PJCIS
6.59
The PJCIS is constituted under section 28 of the Intelligence Services Act 2001 (the Act) and consists of 11 members, including five Senators and six members of the House of Representatives, and must have a majority of Government members.
6.60
Section 29 of the Act prescribes clear functions for the PJCIS, including:
reviewing the administration and expenditure (including annual financial statements) of Australia’s intelligence agencies (ASIO, ASIS, AGO, DIO, ASD and ONA);
reviewing any matter referred by the responsible Minister or either House of Parliament (the Committee may also request that the responsible Minister refer a matter in regard to the activities of intelligence agencies); and
reporting on any matter regarding the performance of the AFP under Part 5.3 of the Criminal Code.
6.61
The Act also limits the PJCIS to these specified functions and prevents it from reviewing intelligence operations or priorities.
6.62
To address the challenges in accessing classified information faced by other parliamentary committees, the Act provides for the release of classified information to members of the PJCIS to fulfil its legislated mandate. To safeguard the release of this information, the Act imposes strict restrictions on committee members and staff regarding the disclosure or publication of certain information and evidence, including disclosures to Parliament. Under the Act, the release of such information is an offence with penalties of up to two years imprisonment.
6.63
Consistent with recommendations of the 1995 Commission, membership of the PJCIS is carefully managed by the Government and Opposition parties, with places usually reserved for experienced parliamentarians. The current PJCIS consists of senior, experienced Government and Opposition members including the Shadow Attorney-General and Shadow Minister for Foreign Affairs.
Effectiveness of the PJCIS
6.64
The PJCIS conducts its work in a largely bipartisan manner. In its recent report on its activities for 2016-17, the PJCIS noted that through its inquiries into national security legislation, it maintained:
… a bipartisan approach that sought to ensure the effectiveness of the provisions while also enhancing safeguards to protect individual liberties.
6.65
The Prime Minister’s recent 2017 Independent Intelligence Review, which examined the operation of Australia’s intelligence agencies, found that the PJCIS and its predecessors ‘have played a critical role in overseeing Australia’s intelligence agencies’ and the significant expertise developed by members ‘constitutes an important accountability mechanism’.
6.66
However, the Committee notes arguments that the powers of the PJCIS and its influence over national security policy are limited. In his 2014 analysis of national security policy, former Senator and PJCIS member, John Faulkner, proposed a number of improvements to achieve effective and best practice oversight of Australian intelligence and security agencies. These included:
… a PJCIS with more flexible membership, greater powers and resources, the capacity to generate its own inquiries, better coordination with the IGIS, oversight responsibility for the counter-terrorism elements of the Australian Federal Police (AFP) and mandatory sunset clauses and review for controversial legislation.
6.67
Professor Trood and Mr Bergin from ASPI, agreed with former Senator Faulkner’s analysis and recommendations, but questioned ‘whether they go far enough’. Highlighting the example of the UK Intelligence and Security Committee, which has ‘a wider, more intrusive oversight mandate’, the mandate of the PJCIS by comparison is ‘severely restrained’:
It’s formally restricted to reviewing the administration and expenditure of Australia’s six intelligence agencies and specifically precluded from investigating a long list of matters, including operations.
6.68
In 2015, Senator the Hon Penny Wong introduced a Private Members’ Bill proposing amendments to the powers of the PJCIS, consistent with former Senator Faulkner’s recommendations. In introducing the Bill, which is currently before the Senate, Senator Wong, argued the changes would improve the ability of the PJCIS to scrutinise Australia’s intelligence agencies:
The central plank of the intelligence and security framework is strong and effective accountability. Enhanced powers demand enhanced safeguards. Public trust and confidence in our security and intelligence agencies can only be ensured fully through strong and rigorous oversight and scrutiny.
6.69
Notwithstanding the limitations of the PJCIS identified by the informed observers and participants, the Committee notes that the provisions applying to the PJCIS relating to the disclosure of classified information and the safeguards applying to it are working effectively. The Committee recognises that effectiveness of the PJCIS to balance secrecy with public debate was recently demonstrated in its inquiry into foreign interference legislation.
Features of proposed model
6.70
The Committee considers that the importance, size and expenditure of Defence, and the particular requirement around protecting defence and security information, warrant a dedicated joint committee that can provide the appropriate level of scrutiny and oversight.
6.71
The Committee considers that the PJCIS provides a useful model for improving parliamentary engagement with Defence.
6.72
The Committee notes that some submitters suggested introducing a parliamentary oversight mechanism for defence policy, similar to the PJCIS. The Australian Manufacturing Workers’ Union (AMWU) suggested introducing a model based on the PJCIS whereby ‘important strategic documents … major purchasing decisions, legislation, regulations and a range of other long-term decisions’ are considered by a bipartisan committee.
6.73
The Committee’s proposed model for a new statutory committee on defence is outlined below.
Function and role
6.74
Like the PJCIS, the Committee suggests that the proposed committee’s functions should be set out in legislation. And, like the PJCIS, these functions should include the ability to review Defence’s administration and expenditure, and conduct inquiries referred to it by the responsible Minister or the Parliament.
6.75
However, noting the limits to the functions of the PJCIS identified by former Senator Faulkner and others, the Committee recommends that the proposed committee’s functions go further than the PJCIS.
6.76
The Committee suggests that the proposed committee should have power to initiate its own inquiries into any aspect of Defence’s administration, similar to the powers of this Committee to initiate inquiries into Annual Reports of Defence and its portfolio agencies.
6.77
As discussed above, the legislation establishing the PJCIS sets a clear mandate to focus on expenditure and administration and does not allow it examine intelligence operations. The Committee suggests that the proposed committee should have a wider mandate than the PJCIS and be given powers to review Defence operations and capability acquisition processes.
6.78
The Committee sees significant benefits in the proposed committee examining the strategic assessments and decision-making processes behind Defence operations and capability acquisitions. These examinations would assist Defence to better inform and educate parliamentarians about the complexities and nuances of these processes and assist the proposed committee in making well-informed, constructive recommendations to the Executive on Defence strategy and capability planning processes.
6.79
The Committee suggests that the dialogue between Defence and the proposed committee would contribute to a better informed debate on defence policy and, where appropriate, contributions to public discussion. As this report has highlighted, improving public debate and awareness of and interest in Defence would have significant benefits in securing Australia’s long-term strategic interests.
Access to information
6.80
The Committee recognises that in order to perform these functions, the proposed committee would need access to classified and sensitive material.
6.81
The Committee recognises that the Parliament has the power and responsibility to oversee and scrutinise all aspects of government administration, including Defence. However, with the exception of the PJCIS, parliamentary committees are rarely granted access to sensitive, classified and commercial-in-confidence information. The information made available by the Executive on Defence’s strategic assessments, capability plans and implementations of internal reforms provide the Parliament with only some pieces of the puzzle. As a result, the understanding of Defence by parliamentarians, and through them, the Australian people, is limited.
6.82
The Committee recognises that it would not be practical nor advisable for Defence to release classified and sensitive information to all parliamentarians without adequate safeguards and protections. The Committee suggests that the PJCIS provides a useful and reliable model for these safeguards and protections.
6.83
Like the PJCIS, the Committee suggests that the members of the proposed committee be bound by legislative requirements not to release classified and sensitive information provided by Defence on a confidential basis. However, the Committee suggests that there should be a mechanism for the proposed committee to publish certain unclassified information where it may assist in better informing public and parliamentary debate, with the agreement of the Executive. The Committee further suggests that any public reports should be vetted prior to release to ensure no classified material is disclosed.
6.84
Like the PJCIS, Committee Secretariat staff should be required to obtain the appropriate security clearance required to perform their roles effectively.
6.85
The Committee considers that these requirements and safeguards, following the proven model of the PJCIS, would allow access to highly sensitive information to enable the committee to fulfil its functions, in a way that is acceptable to the Parliament, the Executive and Australia’s allies and security partners.
Interaction with existing committees
6.86
As discussed, the Committee recognises that Defence already reports to a number of different parliamentary committees. The Committee recognises the important role each of these committee plays in providing oversight and scrutiny of Defence.
6.87
However, the Committee considers there would be significant benefits for both the Parliament and Defence in consolidating oversight of the defence portfolio under the proposed statutory committee. The Committee notes that the proposed committee would have access to sensitive and classified information that is not available to existing committees. These powers would enable the proposed committee to undertake more detailed and better informed examinations of Defence-related legislation, reviews of Annual Reports and Auditor-General reports than are currently possible.
6.88
The Committee further considers that the powers of the proposed committee to access classified information would facilitate better informed debate and discussion for all parliamentary committees. These powers would allow senior government backbenchers and opposition Shadow Cabinet members on the proposed committee access to classified information that would better inform them about the reasons and justifications for key decisions. The private debates about this information by members of the proposed committee could be expected to lead to a better informed contest of ideas and eventually bipartisan agreement.
6.89
Consolidation would also assist Defence by streamlining the majority of its reporting to a single committee, with a single set of expectations and requirements. As identified in its Review of the Defence Annual Report 2015-16, the Committee acknowledges that the current reporting regime for Defence is ‘disaggregated and cumbersome’. Having a single committee overseeing Defence’s core functions could reduce this burden and possible duplication, allowing time and resources for the preparation of more meaningful reporting on the implementation of key reforms as recommended by this Committee and the PJCAA.
6.90
The Committee recognises that the establishment of the proposed committee would effectively dis-establish this Committee as it is currently constituted. The Committee suggests transferring its defence responsibilities to the proposed committee, and re-establishing itself as the Joint Committee on Foreign Affairs and Trade.
6.91
The Committee recommends that the proposed committee should take on the defence-related functions of this Committee, including the review of Defence Annual Reports and other matters covered by this Committee.
6.92
The Committee suggests that existing committees’ functions, including the PWC in reviewing Defence’s public works expenditure, the PJCAA in reviewing the Auditor-General reports of the Defence portfolio (including the Major Projects Report) and the Senate Foreign Affairs, Defence and Trade Legislation Committee in reviewing Budget expenditure during Senate Estimates, should remain the responsibility of those committees.
6.93
However, the Committee recommends that where these committees identify issues related to Defence strategy or that require access to classified information, they may refer the issue to the proposed committee for inquiry and report.
Membership
6.94
The Committee suggests that the proposed committee be a joint committee consisting of senior Members and Senators. Like the PJCIS, the Committee suggests that members should be appointed to the proposed committee by a resolution of the House or Senate on the nomination of the Prime Minister (for House members) and the Leader of the Government in the Senate (for Senate members). Like the PJCIS, the Committee suggests that the membership should include senior government and opposition members, including members of the Shadow Cabinet.
6.95
The Committee suggests that the proposed committee should have a majority of government members. This recognises the prerogative of the Executive to make decisions about the release of classified information, and would seek to encourage more bipartisan and constructive engagement with Defence.
6.96
Given the expanded role for the proposed committee, the Committee considers that it should be an appropriate size to review the broad range of Defence activities. The Committee considers that a membership of at least 15 (between the PJCIS with 11 members and the Joint Standing Committee on Treaties with 16 members), may be appropriate, as this would allow for the formation of sub-committees as necessary to fulfil the proposed committee’s mandate.
Conclusions and recommendations
6.97
The Committee recognises the power of the Executive to exercise its prerogative to make decisions about Australia’s defence. The Committee agrees that governments must have the ability and flexibility to make decisions about the administration of Defence, including the deployment of the Australian Defence Force (ADF) and awarding contracts for capability acquisition.
6.98
The Committee agrees that in our region’s increasingly uncertain strategic environment, it is crucial for Australia to develop modern, flexible and responsive Defence capabilities to meet these new challenges and opportunities. The development of these vital capabilities by the Australian Government and Defence industry require long-term commitments to Defence budgets and capability plans, such as those set out in the 2016 Defence White Paper and Integrated Investment Plan.
6.99
This inquiry has highlighted that the development and implementation of Defence capability planning could be strengthened and supported through more meaningful bipartisan parliamentary engagement. The Committee agrees that bipartisan agreement on Defence policy, achieved through well-informed debate and discussion, would provide greater long-term budget and policy stability for much-needed capability modernisation.
6.100
The Committee considers that a new statutory committee for Defence, similar to the PJCIS for national security, is the best and most appropriate mechanism to facilitate thorough, constructive parliamentary engagement on defence issues. The Committee considers that the establishment of the proposed committee would have significant benefits for Defence, the Parliament and the Australian people.
6.101
Through this new committee, the Parliament would have access to important classified information that underpins Defence’s decisions on capability acquisitions, force modernisation and implementation of key reforms arising from the First Principles Review. Members of the new committee would have the opportunity to develop a better understanding of the complex strategic assessments that inform Defence’s budgetary and policy decisions that is not currently available to members of existing committees.
6.102
Through this new committee, the Parliament could engage in more meaningful debate and discussion, and facilitate better informed, bipartisan agreement on how to best meet Australia’s long-term strategic needs, within a framework that accommodated the requirement to maintain secrecy. This enriched parliamentary debate would help to inform better public awareness and understanding of those Defence issues appropriate for discussion in the public domain, beyond the simple economic considerations that characterise discussions of individual capabilities.
6.103
The defence of Australia is one of the core responsibilities of any national government. The Committee considers that the establishment of a new statutory committee would assist the Australian Parliament to better engage with and support the Australian Government to develop the capabilities needed to defend Australia into the twenty-first century.
6.104
The Committee recommends that the Australian Government introduce legislation to establish a statutory Joint Parliamentary Committee on Defence. The purpose of the committee should be to improve parliamentary engagement with and oversight of the Department of Defence (Defence) and its portfolio agencies and should focus on the development and implementation of Defence strategy.
6.105
The Committee recommends that the legislation establishing the committee should be based on the provisions establishing the Parliamentary Joint Committee on Intelligence and Security (PJCIS), set out in Schedule 1 of the Intelligence Services Act 2001. Similar to the PJCIS, the legislation should ensure that the committee will have:
power to review any aspect of Defence planning, strategy development, administration and expenditure referred by the responsible Minister or by a resolution of either House of the Parliament;
access to classified information from Defence and other security agencies necessary to fulfil its functions (including information necessary to understand Australia’s strategic defence and security environment), through the introduction of safeguards and restrictions for members and staff on the release of information, similar to those prescribed in Schedule 1, Part 1 of the Intelligence Services Act 2001; and
its members appointed by a resolution of the House or Senate on the nomination of the Prime Minister (for House members) and the Leader of the Government in the Senate (for Senate members), with a majority of government members.
6.106
The Committee further recommends that the committee should have:
power to initiate its own inquiries into the annual reports of Defence and its portfolio agencies, similar to the current powers of the Joint Standing Committee on Foreign Affairs, Defence and Trade, which would enable it to investigate Defence strategy, capability planning and implementation of reforms arising from the First Principles Review; and
at least 15 members in order to form sub-committees to undertake these proposed functions.
6.107
The Committee recommends that the committee assume the defence‑related responsibilities of the Joint Standing Committee on Foreign Affairs, Defence and Trade, which should be re-established as the Joint Standing Committee on Foreign Affairs and Trade.
6.108
The Committee acknowledges that a number of existing parliamentary committees have oversight responsibility for different aspects of the Defence portfolio, including the Joint Committee of Public Accounts and Audit and the Parliamentary Standing Committee on Public Works. The Committee recommends that these committees retain their functions and where they identify issues related to Defence strategy or that require access to classified information, they may refer the issue to the proposed committee for inquiry and report.
6.113
Senator Jim Molan AO DSC
Senator the Hon Ian Macdonald
6.115
Defence Sub-committee
Joint Standing Committee on Foreign Affairs, Defence and Trade
6.116
13 November 2018
13 November 2018