2.1
A key component of the terms of reference was to consider the prevalence, characteristics and significance of foreign interference, undisclosed foreign influence, data theft and espionage, and associated risks to Australia’s national security (the risks) in the sector.
2.2
The Committee considered the prevalence (the probability and frequency of these risks occurring), the characteristics (how the risks were manifesting themselves) and the significance (the consequence of the risks and degree to which these issues represent serious national security concerns). The Committee considered risks as a function of probability and consequence and relied on submissions and hearings to make these assessments.
2.3
Where Chapter 3 considers the sector’s awareness of national security risks and their efforts to identify and mitigate these risks, and Chapter 4 considers the efficacy of government policies in respect of these risks, this chapter considers what the national security risks are and their relative significance.
2.4
This chapter will first discuss the sector itself, considering why it may be considered a target and what factors have led to this occurring. It will then move to a discussion on the risks themselves, defining the key concepts and assessing the manifestation of the risks in the sector.
The Australian Higher Education and research sector
2.5
The sector, as outlined in the terms of reference, is a broad grouping of entities throughout Australia involved in research and higher education. A significant portion of the sector is the 43 universities in Australia. These universities serve important functions in both teaching and research across a wide variety of subjects.
2.6
In addition to the universities the sector includes coordination and advocacy bodies such as the Group of 8 (Go8), the Australian Technology Network of Universities (ATNU), Innovative Research Universities (IRU) and Universities Australia (UA) as well as government entities involved in the provision of grants or research such as the Australian Research Council (ARC) and the Commonwealth Scientific and Industrial Research Organisation (CSIRO).
2.7
The sector also encompasses joint ventures between universities and enterprise. The sector, by this definition, is intended to be comprehensive. The most relevant Federal Government department for the sector is the Department of Education, Skills and Employment (DESE), and for the risks it is the Department of Home Affairs.
Economic importance of the sector
2.8
The sector is an important part of the Australian economy. As UA said, international education is Australia’s fourth largest export. International education generated $40.3 billion in export income in 2019 and this increased 153 per cent from 2008 to 2019. Of this, the higher education sector contributed around 70 per cent of the international education export income in 2019. UA, citing government data, suggested 247,454 full-time equivalent jobs were supported by international education in 2018. DESE said the sector provided an innovation system critical for maintaining a ‘strong and globally competitive Australian economy’.
Research importance of the sector
2.9
Several submissions noted the importance of the research performed by Australian universities and the impact of this research on Australian society. UA said universities performed approximately 43 per cent of all applied research in Australia in 2018. UA said domestically Australian universities perform 90 per cent of basic research.
2.10
The ARC said Australia was responsible for approximately 3 per cent of global scientific output while being home to only 0.34 per cent of the global population. DESE said the strong research sector in Australia underpinned the reputation of universities which ensured strong performance in international university rankings and attracted international students and researchers to Australia.
2.11
DESE said both the sector and the Australian community benefited significantly from the presence of international students and collaboration with international researchers. DESE said this research supported the competitiveness of Australian companies and the growth of the Australian economy.
2.12
The Australian Technology Network of Universities with the University of Newcastle discussed the broader public good that universities provided, saying:
Universities are public institutions, existing for public good, which means we have a responsibility to ensure national prosperity, and the development of knowledge, as well as a critical role as custodians of our free and open society.
The importance of international collaboration and research
2.13
Several submissions discussed how important international collaboration was for the sector, including for research and international student populations. These submissions discussed international students, research outputs with various countries, and other types of international engagement activities undertaken by the sector.
2.14
The Go8 additionally said Australian research engagement with China was significantly less than popularly assumed. They said Go8 university international collaboration between 2015 and 2019 (in terms of co-publication) was 34 per cent with the European Union, 23 per cent with the United States, 17 per cent with the United Kingdom and 13 per cent with China. Go8 said there was significantly greater engagement between China and both the United Kingdom and United States than Australia. Go8 said between 2015 and 2019 the United States co-published 21,292 articles with China on the sensitive topic of materials science compared to Australia’s 6,352. These statistics were used to demonstrate Australia’s research relationship with China was less than commonly assumed.
2.15
In discussing the international student context in Australia DESE said there were approximately 66,578 higher degree by research students in Australia in 2019, 36 per cent of this number were international students. The Cyber Security Cooperative Research Centre (CSCRC) said 37 per cent of all PhD students in Australia were international students, and of those 75 per cent were enrolled in science-related degrees. These statistics were given in order to illustrate what the international student environment was in Australia.
2.16
In discussing international student populations the University of Queensland (UQ) discussed the importance of diversification and said:
I think universities were always very conscious that they needed to diversify the source countries of their international students and that an overdependence on one country was exposing them to a level of risk. Whether that risk was geopolitical or whether it was more narrowly economic would just depend on the circumstances at the time.
2.17
Western Sydney University (WSU) provided a brief overview of the types of international engagement which could be possible by institutions in the sector. This included memoranda of understanding, articulation agreements, and agent partnership agreements, cooperative agreements, letter of intents, agreements for short courses, study abroad arrangements, and student and staff exchange agreements. WSU said they had over 400 international agreements with over 320 international institutions across 55 countries. It was clear from submissions there was extensive international engagement occurring across a variety of schemes and programs.
Importance of international engagement by the sector
2.18
Many, if not all, submissions from the sector emphasised the critical importance of the sectors’ international engagement. Primarily this was a defence of international research engagements and collaboration. Go8 said international collaboration and research was the norm, not the exception, and delivered significant value to Australia. Several universities, including UNSW, requested the committee acknowledge the importance of the sector and international collaboration as part of any national security risk mitigation proposals. The University of Canberra discussed the importance of international engagement by the sector and said:
International engagement is a core part of our approach and international collaboration with institutions is fundamental to the advancement of Australian based research and development – advancements that ultimately provide benefit to the Australian community and economy.
2.19
UA said 78 per cent of Australia’s most highly cited publications were attributed to international collaboration, with citation being the metric for impact and success. The Australian National University (ANU) said:
The last 12 months have clearly demonstrated how vital international collaboration is to Australia. The challenges presented by the COVID-19 pandemic and shifting geopolitical factors have not led to isolationism. We have seen nations and the institutions they house demonstrate an unprecedented commitment to cooperate, learn and benefit from each other’s experiences and expertise.
2.20
Griffith provided the examples of their collaboration with an Indian vaccine manufacturer on a COVID-19 vaccine and a German institute on anti-infective drugs as demonstration of the importance of international research engagement.
2.21
The Australian Academy of Science (AAS) said Australia benefited through membership of international science organisations through direct economic returns, indirect benefits, providing Australia a ‘place at the table’, providing opportunities for Australian perspectives and enhancing Australia’s scientific reputation. The German Rectors’ Conference built on this point and said:
The safeguarding of institutional autonomy and academic freedom is of paramount importance to the successful operation of universities…international cooperation is indispensable to the complete fulfilment of the universities’ mandate. It provides substantial impetus for innovation in teaching, learning and research. Only globally connected universities will be successful in the long-term and can thus continuously contribute to the economic and social well-being of societies.
2.22
Universities Australia said Australia contributed $US 21.2 billion of the $US 1.94 trillion 2018 global research and development expenditure. UA argued Australia would have to maintain its strategy of global connections to leverage the 99 per cent of investment occurring outside Australia. UA noted 29 per cent of global expenditure is concentrated in the United States, 24 per cent in China, and 22 per cent in the European Union. The argument raised was Australia needs to remain heavily engaged in global research to advance Australian interests.
Box 2.1: The sector’s importance in Australia
The higher education sector contributed to 70 per cent of Australia’s international education export market which is Australia’s fourth largest export in 2019.
2.23
A common submission from the sector and from government was international cooperation and engagement was a critical function of the sector. La Trobe University said, ‘international co-operation is at the heart of universities’ raison d’etre’. The value from this engagement was both financial and intellectual. Western Sydney University said high impact research was often delivered through international collaboration and this was strongly in the national interest. The AAS agreed and said:
Modern science is built on partnerships and collaborations surpassing national borders, in pursuit of innovative solutions to pressing global challenges…maintaining support for international research collaborations allows scientists to exchange ideas and engage in productive scientific progress that build on synergies to the benefit of the host nation as well as its partners. These interactions create shared interests providing a basis for diplomatic engagement that can be valuable in promoting harmonious international relations.
2.24
Western Sydney University said Australia was a net importer of intellectual property which indicated Australia was benefiting significantly from international research funding and expertise. Griffith University concurred with these arguments and said:
International collaboration is central to Australia’s research excellence and international research collaborations enable a diverse, rich and nuanced set of engagements that support Australia’s long-term national interests. Partnerships with international universities and other internationally based organisations are highly beneficial to Australian universities and to our broader society.
Importance of the sector in advancing Australian interests and soft power opportunities
2.25
Several submissions discussed how the sector advanced Australian interests, including through exchanges, educating international students, and via research. The University of New South Wales (UNSW) said international engagement by Australian universities was critical to the national interest including as a form of soft power diplomacy. UNSW said this international engagement was in the national interest and supporting Australia’s foreign policy objectives, including through policies such as the Colombo Plan, the DFAT Global Alumni Engagement Policy, and bilateral engagement policies with both India and China. DFAT, in their submission, discussed the New Colombo Plan and how it was a key tool to promote Australia’s regional soft power.
2.26
Taking this argument further, the University of Tasmania recommended Australian engagement with foreign higher education sectors required a stronger approach in order to maximise Australian soft power opportunities while minimising risk. The University of Tasmania suggested Australian policy is ‘reoriented’ to start with strategies to advance our interests while developing a more sophisticated defence strategy in support of this. The University of Tasmania said there was a requirement for Government to focus on actively shaping the environment in this regard.
2.27
The University of Tasmania recommended both government and the sector intentionally seek strong engagements with foreign institutions to accelerate Australian capabilities. A related argument was raised by several submissions in favour of developing an intentional Australian national talent development strategy. Mr Alex Joske suggested the development of a strategy to explain how Australia will develop and maintain talent and support research commercialisation to advance Australian interests.
2.28
The University of Tasmania identified four soft power opportunities universities could pursue and recommended more active government strategies in this regard. These opportunities were: supporting rules based international order underpinned by science; collaborations to accelerate national capability acquisition; strengthening foreign country institutions to aid democratic transitions; and advancing understanding and networks to democratic societies and said additional effort was required to best utilise Australia’s research to advance diplomatic objectives. The University of Tasmania suggested a more intentional view of international research agreements to advance Australian objectives using both a defensive and offensive approach.
2.29
The AAS suggested a charter be developed between scientists and the Australian Government to articulate expectations and obligations of both to the Australian people. The AAS said this mandate would provide clarity regarding the obligations of scientists to respect the mandate of government to identify national priorities including national security, and the obligations of government to respect the right of scientists to pursue knowledge free from political interference and censorship.
The sector as a target
2.30
The Committee considered why, if at all, the sector was a target after these initial discussions around the characteristics of the sector itself. ASIO said Australia’s higher education sector was one of the sectors at risk of espionage and foreign interference in Australia. ASIO said the espionage and foreign interference threat was both pervasive and enduring:
ASIO assesses hostile intelligence activity continues to pose a real threat to Australia, our sovereignty and the integrity of our national institutions.
2.31
ASIO said hostile foreign state actors were attempting to: gain insights into our international alliances and defence relationships; obtain privileged information on our positions on international diplomatic, economic and military issues; gain a commercial advantage over Australia; access our innovations in science and technology; and shape the actions of Australian decision-makers and public opinion in favour of the foreign state. ASIO discussed the sector’s role in this threat environment and said:
Universities and research institutions are one such sector that is vulnerable to these kinds of activities, given foreign governments are seeking information about Australia’s capability, including our research and technology.
2.32
ASIO provided additional commentary on the openness of the sector and how adversaries could take advantage of that, saying:
Foreign intelligence services and their proxies are all too willing to take advantage of the openness that is integral to our universities and research institutions to steal intellectual property and cutting-edge technologies. Again, it is the intent and character of the activity that matters.
2.33
The Australian Federal Police (AFP) said they were aware of reporting academic institutions had been targeted by foreign principals. As a foundational principle the Committee accepted evidence that the sector was one among several which were, or had the capacity to be, subject to national security risks as outlined in this inquiry.
2.34
With respect to changes in policy and practice in Australia ASIO said:
We have seen the foreign intelligence services or foreign agencies involved in seeking to interfere pay attention to this. We see them modify their tradecraft, as we refer to it. It doesn’t stop them but it does cause them to pause and redirect their efforts, potentially though different means. So we are having an effect, but it’s not a silver bullet because their tradecraft will evolve.
2.35
ASIO said one of the reasons the sector was at risk was because it was at the leading edge of policy, research and scientific development. This general position was noted in several submissions from within the sector who broadly concurred with the ASIO assessment. A common refrain was due to the international aspect and collaborative nature of universities, this could be taken advantage of by hostile actors. CSIRO agreed with this view and said:
The open environment of international collaboration also has the potential to put the Australian research sector at risk of exploitation by foreign actors who may not have the same high standard of research integrity. Compromises of valuable research, or other sensitive data, can cause significant damage to Australia’s economy and national security.
2.36
ASIO also put the threats in context and agreed with the broad university position that their core business should continue, saying:
Taking a sensible approach to national security risks shouldn’t stop the sector from getting on with their core roles.
2.37
The Department of Education, Skills and Employment (DESE) further emphasised the importance of the sector, but noted the vulnerabilities that these national security threats posed, saying:
A secure higher education and research sector is critical to the Australian economy and national interest. Australia’s higher education and research sectors deliver innovative research and intellectual property, and create employment in science, new technology and advanced manufacturing. International collaboration is essential to achieving these benefits. However, the success of Australia’s higher education and research sectors and its need to remain globally connected, place it at risk of interference from foreign actors.
2.38
ECU said the important principles of the Australian university sector of innovation, openness, collaboration and the free exchange of ideas presented risks. CSCRC made this point more specifically and said the sector was a target in part due to the valuable intellectual property (IP) the research community produced:
This IP has the potential to facilitate Australia’s progress, both economically and strategically. For this reason, it is also valuable to others.
2.39
The CSCRC qualified this comment by observing the vast majority of research collaboration was of little consequence to national security. They said areas of research that leveraged Australia’s capability and had national security implications, strong protections were required.
2.40
The argument commonly raised was the sector is a target, but it is not unique in this regard and is indeed one among many sectors that is targeted in Australia. ATNU argued this point and said:
Universities face similar risks (and similar scales and impacts of risk) regarding data theft and espionage to any Australian public institution or company.
Legislation and definitions of key concepts
Legislative definitions and scope
2.41
The relevant legislation as it relates to this inquiry is primarily the National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018 (Cth) (the EFI Act) and the subsequent amendments the EFI Act made to the Criminal Code Act 1995 (Cth) (the Criminal Code). The terms of reference primarily limit this inquiry to foreign interference, undisclosed foreign influence, data theft and espionage – all of these terms are defined below. These national security risks are primarily discussed and defined in the EFI Act and Criminal Code but with reference to the Australian Security Intelligence Organisation (ASIO) Act 1979 (Cth) (the ASIO Act). Together, the terms of reference and these legislative definitions provide the scope for this inquiry.
What are national security risks?
2.42
National security was defined under section 90.4 of the Criminal Code as amended by the EFI Act to mean:
The national security of Australia or a foreign country means any of the following: (a) the defence of the country; (b) the protection of the country or any part of it, or the people of the country or any part of it, from activities covered by subsection (2); the protection of the integrity of the country’s territory and borders from serious threats; the carrying out of the country’s responsibilities to any other country in relation to the matter mentioned in paragraph (c) or an activity covered by subsection (2); the country’s political, military or economic relations with another country or other countries.
For the purposes of subsection (1), this subsection covers the following activities relating to a country, whether or not directed from, or committed within, the country: (a) espionage; (b) sabotage; (c) terrorism; (d) political violence; (e) activities intended and likely to obstruct, hinder or interfere with the performance by the country’s defence force of its functions or with the carrying out of other activities by or for the country for the purposes of its defence or safety; (f) foreign interference.
2.43
Risk is exposure to the chance of injury or loss. It refers to the function of probability and consequence. Risk management therefore is the identification, analysis and mitigation of risk, which includes reducing vulnerability to low-probability, high-consequence events.
2.44
National security risks are simply risks that relate to national security threats and issues as defined above. In simple terms this includes the risk of espionage (acquisition of information for a foreign power) and foreign interference (covert activity designed to malign Australian interests). This is not an exhaustive list of national security risks. These are risks both to institutions at a macro level and to individuals at a micro level.
National security risks identified in the sector
2.45
This section details actual issues and risks as identified by submissions and briefings to this inquiry. Where Chapter 3 discusses the sector’s ability to identify and respond to issues, this chapter is limited to discussions around the issues themselves. There is naturally some overlap between risks identified and the sector’s capacity to identify risks.
Cyber risks
Prevalence and characteristics
2.46
Cyber can be considered in several different contexts but for this inquiry the focus is on cyber risks faced by the sector, and national security risks that can materialise via cyber means such as foreign interference or espionage. The Department of Home Affairs categorised the cybersecurity threat in universities as:
The threat is very real. It is getting a lot realer and a lot harder, even for very sophisticated organisations.
2.47
ASIO noted that espionage could be via cyber means which allows this threat to be categorised as a vector through which other national security risks can materialise. Using the same argument, foreign interference could also occur via cyber means. As ANU noted in their submission, often national security threats materialise as part of a series rather than in a neat category. This was a unique point not explained or contextualised by many other submissions.
2.48
ASIO said they were aware of attempts to steal sensitive Australian IP as part of cyber compromises. Queensland University of Technology (QUT) said they had observed one significant nation-state cyber activity event which was in March 2020 by an Iranian actor known as ‘Charming Kitten’. QUT said ‘Charming Kitten’ had targeted a number of universities in Australia. QUT said the vast majority of information security incidents related to cybercrime. No other sectoral submissions noted the ‘Charming Kitten’ cyber-attacks.
2.49
CSCRC said malicious cyber actors were attempting to steal IPdata related to the COVID-19 vaccine and noted ASIO had assisted medical and scientific organisations in ensuring their IP data was not stolen. CSCRC noted an Australian Broadcasting Corporation (ABC) article relating to an incident where the United States Department of Justice had accused the Chinese Government of hacking firms developing COVID-19 vaccines.
2.50
DESE cited the Australian Cyber Security Centre Annual Cyber Threat Report 2019-20 which identified more than 120 cyber-attacks on universities in the previous 12 months.
2.51
The Department of Home Affairs noted that whilst the information and communication technology (ICT) of the sector was not as well prepared as it could be, it was one among many other sectors who faced similar issues.
2.52
The CSCRC discussed the importance of protecting IP from cyber-theft and said:
While ideas are free, protecting them comes at a cost – and intellectual property must be protected vigorously. Hence, cyber security is essential to ensuring Australian-produced IP and data remains safe.
2.53
CSCRC, in providing the example of Operation Cloud Hopper, said malicious cyber actors could identify vulnerability via third-party providers which the CSCRC suggested should be of particular concern for the Sector which relies on these third-party providers.
Significance
2.54
The clearest articulation of the significance of this issue came from the University of Tasmania who said the most regular, intense and sustained threat it faced was in the cyber domain. They noted they dealt with large numbers of daily attempts to break into the university network from a range of foreign (and other) actors.
2.55
ASIO said the ability to acquire information via human means (traditional espionage) had been hampered due to COVID-19 which could lead to a reliance on cyber means to achieve various hostile ends, saying:
Cyber is sometimes technically hard but a far more effective medium to acquire information.
Espionage
2.56
Espionage is not a new term though several new espionage offences were introduced into the Criminal Code via the EFI Act Division 91. Broadly these offences included dealing with information concerning national security which is or will be communicated or made available to a foreign principal, and dealing with information which is or will be communicated or made available to a foreign principal. ASIO said:
Most people have a good understanding of espionage. In plain language, it’s when a foreign power or someone acting on behalf of a foreign power, steals valuable information either physically or by cyber means.
Box 2.2: What is espionage?
The Director-General of Security said espionage was when someone, acting on behalf of a foreign power, steals information. It doesn’t need to be covert or via physical means.
2.57
These offences relate primarily to the provision of information to a foreign principal, the information itself does not necessarily need to be security classified and the means of acquisition do not necessarily need to be covert. Under this definition, data theft could be a considered a means through which the end of espionage is achieved. That is, data could be stolen and provided to a foreign principal and be considered as both data theft and espionage. For the purposes of this inquiry, the scope is deliberately narrowed on data theft to be relating to national security, which generally would come in the form of espionage. To additionally complicate this point, you could steal cyber data via cyber means and it would still be considered espionage.
2.58
ASIO noted how the epsioange threat was different from others, describing it as:
The threat will come at the institution and the students through different ways, depending on what they’re after – information, or to shape the environment so that it doesn’t do things that are counter to that nation’s interest.
Students who are engaged in research have access to sensitive or potentially sensitive information, and they can be a vector to acquire that. The foreign intelligence service could target institutions, their researchers and academics, and the students to acquire that information.
Prevalence and characteristics
2.59
ASIO said they were aware of researchers and their families being threatened, coerced or intimidated by actors seeking to have their sensitive research provided to a foreign state. CSIRO said foreign actors could use both human and technical capabilities to achieve the goals of satisfying foreign governments’ intelligence requirements.
2.60
The University of Queensland (UQ) disagreed with these assessment around the prevalence of espionage and said the risk of espionage was ‘relatively limited’ in their usual academic and research activities based on UQ analysis and incidents, but noted awareness of this risk was critical. This was contrary to the submission by Mr Alex Joske which noted possible technology transfer occurring from UQ. UQ did note a key national security risk could be leakage of IP, unauthorised sharing of confidential information and cyber intrusions against sensitive technologies.
2.61
Using a different argument but broadly agreeing with the UQ premise the AAS submitted they were aware of no significant violations of the Defence Trade Controls Act 2012 which they said would indicate no ‘concerted attempt to subvert Australia’s sovereignty via academia’. Mr Chen Yonglin said China had been successful in acquiring scientists and scholars from Australian tertiary institutions and stealing technologies. Debate therefore existed as to the severity and prevalence of this particular issue. The Australian Values Alliance said ‘most of CSIRO “cooperative activity” with China is unilateral technology transfer, not for mutual benefit’. Dr Simon Leitch argued in his submission of the significance of this particular issue:
It is the act of a blind and self-destructive society that we should have allowed university researchers to build careers by sharing information that will be, within our lifetimes, the strategic equivalent of the atom bomb in the last century.
2.62
Mr Chen Yonglin said infiltration into Australian tertiary institutions was an important part of Chinese foreign policy in 2004 as part of an effort to ‘turn Australia into a stable supply base of high-quality natural and energy resources, a backyard of China’. Dr Simon Leitch said there was no distinction between public and private research in China and all information gathered by Chinese researchers could be used by the Chinese Government. Dr Leitch noted all information has beneficial applications for the Chinese Government, including state owned industries.
Significance
2.63
ASIO provided a summary of the significance espionage can have on Australia and said:
The compromise of valuable research, or other sensitive data, can cause significant and long-term damage to Australia through the loss of intellectual property and commercial advantage, along with potential damage to reputation and international standing – damaging Australia’s economy and national security.
2.64
ASIO said Australia was facing a heightened threat from espionage. In a more specific example Department of Defence said defence research was fundamental to developing and enhancing the Australian Defence Force’s technological advantage. Defence said Australia’s technological advantage would only be maintained when research and its application was appropriately protected from foreign interference and potential adversaries. Defence said as its investment in innovation and academic collaboration, it would expect a larger proportion of collaborative research would need protection from national security risks. The point from this argument was protections from espionage could only be expected to rise.
2.65
Dr Simon Leitch said universities had become engaged in some military-industrial research collaborations with foreign dictatorships which would erode western military supremacy and allow repression in those countries. Dr Leitch described engagement with China as ‘legal espionage’.
Foreign interference
2.66
ASIO said foreign interference was defined by section four of the ASIO Act to mean:
Activities relating to Australia that are carried on by, or on behalf of, are directed or subsidised by or are undertaken in active collaboration, with a foreign power, being activities that:
(a) are clandestine or deceptive and are:
(i) are carried on for intelligence purposes;
(ii) are carried on for the purposes of affecting political or governmental processes; or
(iii) are otherwise detrimental to the interests of Australia; or
(b) involve a threat to any person.
2.67
ASIO provided an over-arching threat statement of foreign interference in Australia and said:
Hostile foreign intelligence services have directly threatened and intimidated Australians in our country.
2.68
ASIO provided commentary on the nuances associated with foreign interference compared with both espionage and foreign influence, saying:
Foreign interference is a broader, more nuanced concept [than espionage]. All foreign states seek to influence deliberations of importance to them. When those activities are conducted in an open and transparent manner they are not of concern. However when it is conducted covertly by, or on behalf of, a foreign actor; when it is clandestine, deceptive corrupting or threatening in nature and when it is contrary to Australia’s sovereignty and interests, we classify this as foreign interference.
2.69
Of foreign interference, ASIO described the effects and said:
Foreign interference is about covertly shaping decision-making to the advantage of another nation. If left unchecked, it is highly corrosive.
2.70
ASIO additionally said foreign interference involves clandestine, deceptive or threatening activities that undermine Australia’s sovereignty, its values, interests and security. ASIO noted voicing support for a particular government or its policies is not, of itself, foreign interference. But if that advocacy was secretly directed by the foreign government and was contrary to Australia’s national interests, it could be. ASIO noted protest activity itself would not be foreign interference, but could be if it was secretly being directed by a foreign state or people were coerced into participation (or not participating).
2.71
The University Foreign Interference Taskforce (UFIT) Guidelines (the UFIT Guidelines) identified foreign interference could be a threat to the sector through efforts such as: efforts to alter or direct the research agenda; economic pressure; solicitation and recruitment of post-doctoral researchers and academic staff; and cyber intrusions.
Prevalence and characteristics
2.72
ASIO said they were aware some universities had been threatened with financial coercion should critical research continue. ASIO said they were also aware of instances where academics had self-censored course material to avoid adverse outcomes such as cuts to foreign funding or threats from individuals who may be linked to a foreign government. ASIO said of this:
Some foreign governments – and it’s more than one – care about what their students get up to on campus – so, just some awareness of what their students might be up to. And in some cases they might use or want to use their students to counter certain things that are being said on campus as students go about their free speech, or universities and the curriculum they’re teaching, that might be a problem for certain nation states.
2.73
In relation to free speech and foreign interference ASIO said:
What’s behind it – whether or not it’s foreign interference, as I would see it – is something we focus on. I think you see a range. Some of it is just students being students and being proud of their own country of origin, but, yes, there are a small number of cases that we’re aware of where you might see people being encouraged to do that.
2.74
The Department of Home Affairs said the foreign interference risks were directed towards changing decisions and outcomes by:
1
Cultivating and manipulating people, including through personal, political, business and diplomatic relations, to gain advantage;
2
Limiting freedom of expression and shaping the media and communications landscape to spread propaganda, dominating foreign language media, or undermining and misguiding public discourse on matters of national significance; and
3
Singling out sections of the community through pressure and manipulation to sow discord, silencing dissent or damage the cohesion of our society.
2.75
The Department of Home Affairs, in particular reference to the sector and its vulnerability to foreign interference, said:
This open environment of international collaboration also has the potential to put Australian universities and the research sector at risk of exploitation by foreign actors who do not follow the same rules of academic integrity as we do, or share our values…the majority of international interactions between Australian universities and the research sector are welcome and to Australia’s benefit. However, there may be foreign actors who seek to engage in foreign interference in the Australian higher education and research sector.
2.76
Human Rights Watch (HRW) discussed an incident where Ms Elaine Pearson was interviewed by her employer the University of New South Wales (UNSW) for a piece on Hong Kong’s national security law. In this incident, the published interview was subsequently removed. HRW noted the subsequent ‘aggressive’ campaign targeting UNSW which led to UNSW briefly removing the article and re-instating it. HRW noted the potential ‘chilling effect’ these actions could have on open debate regarding the CCP. Ms Pearson said:
This happened largely because there was a huge backlash from pro-CCP students and others, basically flooding UNSW’s media accounts.
2.77
HRW said they were disappointed with UNSW’s response to this issue. They said:
Yes, you’re free to disagree with your lecturer about Hong Kong, Xinjiang or Tibet, but you’re not free to demand that the person lose their job over it. What disappointed me was that there was a real failure to follow up and there were very different messages being sent in Chinese to one cohort and in English to the staff.
2.78
HRW said they did not think it was a problem unique to UNSW and that there were no clear signs that a similar incident would not occur again.
2.79
The Vice-Chancellor of UNSW said of this incident:
This was an event that concerned me greatly. It’s an event that I took the earliest opportunity to issue an apology for on behalf of the university and it’s an event which we have taken steps to make sure could not occur again.
2.80
UNSW described the incident as ‘a rare example where UNSW got it wrong’ and said they had taken steps to ensure it could not happen again.
2.81
Mr Drew Pavlou described an incident he experienced at UQ during an allegedly violent protest on campus. Mr Pavlou said of these incidents more broadly:
I think we’re seeing a chilling effect across Australia for students. There are so many cases where students with family members in China cannot speak, because they feel that the Chinese Communist Party can reach them even here.
2.82
UQ said of this incident and in response to Mr Pavlou’s claims:
Mr Pavlou painted a picture where he was a victim and the university was a villain…neither the then vice-chancellor nor myself were involved in the instituting of disciplinary processes against Mr Pavlou. I did not know that the processes had started before they had started. I was not aware of the misconduct charges until I had read them in the media.
2.83
HRW said of foreign interference on campuses more broadly that:
There’s a whole range of experiences, but the deep feeling there is fear. What I think is surprising out of our research is the level of self-censorship.
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Central Queensland University (CQU) provided a more international perspective and said the risk of foreign interference and influence could be especially possible when participating in international dialogues, agreements and partnerships.
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Queensland University of Technology disagreed with several of these more specific submission and said they believed the prevalence of foreign interference (and influence) to be relatively low at present in the higher education sector. UQ concurred and said the risk of foreign interference was ‘relatively limited’ in their usual academic and research activities based on UQ analysis and incidents, but noted awareness of this risk was critical. UQ noted additional national security risks they considered to be key included failures to disclose conflicts of interest and appointments with foreign universities and governments.
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The University of Tasmania provided insights into this issue and said it was aware some countries created ‘schemes and incentives that aim to create asymmetric or manipulate/coercive relationships’. Dr Simon Leitch said universities created forums for foreign agents to undertake foreign interference activities in support of adversarial regimes. Dr Leitch suggested compliance with foreign power requests was required for career advancement within academia.
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Mr Chen said the commercialisation of tertiary education and increased cooperation with China had led to a deterioration of academic freedom in favour of the CCP political agenda.
Foreign interference involving official presences in Australia and Confucius Institutes
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The Committee received some evidence regarding Confucius Institutes, both at a localised level and more broadly. When asked about the Chinese Government funding particular programmes at UQ via the Confucius Institute, UQ said:
Since that was discovered, it would now not be possible and we have put in place changes to the governance arrangements…no funding, since that was discovered, has been provided by the Confucius Institute for the development of course material.
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UQ was unable to answer who specifically approved the funding arrangement previously.
2.90
Discussing Confucius Institutes more broadly Mr Chen Yonglin recommended the closing of Confucius Institutes in Australia.
2.91
In a discussion around foreign diplomatic presence interference activities Human Rights Watch provided an example of a pro-Hong Kong democracy protestor who received a private message from an individual who said they were going to report the individual to the Chinese consulate. HRW also provided an example where:
A student is sitting in a Zoom class because of COVID and has a Hong Kong independence flag behind them and someone slides into their DMs: ‘I saw that flag. I’m going to report you’.
2.92
Furthering this discussion around relationships between official presences and universities Mr Chen Yonglin said in 2013 the University of Sydney cancelled a speaking event by the Dalai Lama after pressure from the PRC Consulate in Sydney. Mr Chen submitted the PRC official presence in Australia often threatens universities with cessation of cooperation on Chinese student recruitments.
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Human Rights Watch (HRW) noted their observations on foreign interference saying:
Since 2015, Human Rights Watch has tracked how Chinese government authorities have grown bolder in trying to shape global perceptions of China on university campuses and in academic institutions outside China. These authorities have sought to influence academic discussions, monitor overseas students from China, censor scholarly inquiry, or otherwise interfere with academic freedom.
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Specifically, HRW noted their awareness of Chinese authorities monitoring students and academics and applying pressure to the families of students. HRW noted in 2019 Victoria University cancelled the screening of a documentary critical of Confucius Institutes after the Victoria University Confucius Institute complained. The Falun Dafa Association of Australia (FADA) described an incident (potentially the same one) whereby Falun Dafa practitioners learnt an event at Victoria University in Melbourne was cancelled following pressure from a Chinese Consulate.
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FADA described an October 2019 incident whereby a Falun Dafa practitioner at Adelaide University had a lecture theatre booking request accepted and then rejected. FADA said the booking was to show a film relating to alleged persecution of Falun Gong practitioners. FADA said some believed this decision was influenced by the Adelaide University Confucius Institute, and possibly the Chinese official presence in Adelaide.
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HRW said they were aware of several cases in Australia where students from China (and Hong Kong) were reported on by fellow classmates for comments critical of the CCP. HRW said knowledge of these incidents then spread quickly throughout communities which led to self-censorship. HRW quoted one Australian student:
If you protest against the CCP abroad they will find people you love and hurt them to make you pay.
2.97
In response to addressing issues of social cohesion on campus ANU said:
For us, one of the first things we have to do is provide a safe classroom, which I think we have methods of doing, but also a secure digital environment. That’s why cybersecurity is important. I do think then the social cohesion comes in.
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Mr Chen said in 2002 he accompanied a PRC Consul to meet an academic at the University of Sydney who had requested PRC Government funding and promised to continue to condemn Falun Gong.
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HRW said in Australia pressure came in numerous forms including: monitoring discussion topics on WeChat; putting Chinese students under surveillance; and threatening those who participate in protests or events the Chinese government believe sensitive. HRW said Chinese students had expressed concern with the Chinese Students and Scholars Association (CSSA) and their links to the Chinese official presence in Australia.
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On the characterisation of this issue, HRW noted a recent United States study emphasised the importance of recognising some of these foreign interference activities are targeting Chinese students, and the importance of integrating Chinese students in universities.
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Melbourne University said they were aware of a relationship between the Chinese Consulate General in Melbourne and the Chinese Students and Scholars Association. They said the Associate Deputy Vice-Chancellor International (China) had spoken to the UoM CSSA about academic freedom and freedom of speech. UTS commented on this issue and said consulates had a legitimate role to play on campus in looking after their students.
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When discussing the appropriateness of foreign emissaries serving at universities UQ discussed a localised example for them which was subject to some controversy and said PRC Consul-General in Brisbane Xu Jie was still an honorary professor at UQ. They did say of it:
I must say, I had not been aware of it and I do not agree with the appointment of serving foreign officials as adjunct professors.
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Mr Chen Yonglin said China had been successful in infiltrating tertiary institutions in New South Wales. Mr Chen said this had included the establishment and management of Confucius Institutes and Chinese Students and Scholars Associations in Australian universities and compromising academic freedoms in universities. Mr Chen said the Chinese Government viewed Confucius Institutes as an agent of soft power and an ‘important element of the global grand propaganda strategy’. Mr Chen said Confucius Institutes would not discuss some political issues and students of these institutes were viewed as potential valuable assets for future espionage and political influence operations.
The Confucius Institute is a Trojan horse of the Chinese Communist Party planted in overseas tertiary education, not a treasure box delivered from Communist China.
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Mr Chen said the CSSA system was a tool of the CCP and the People’s Republic of China (PRC) Consulate in Sydney created and ran all CSSAs in NSW. Chen said CSSAs were funded by the PRC official presence and some of its projects were funded by United Front Work Department (UFWD) organisations in NSW. Chen said the CSSAs allowed for the CCP to successfully control Chinese students on university campuses, including through the facilitating of counter-rallies. Chen said in 2004 the PRC Consulate in Sydney pressured the University of Wollongong CSSA to take down a poster. Chen said in 2016 a University of Sydney academic was forced to resign after the University of Sydney CSSA organised a campaign against the academic.
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In regards to the CSSA and the issues identified by some submissions ASIO said:
Again, if vehicles like that were used to covertly direct, that has my full attention. Of course, I can also recognise that, if that’s happening but it’s happening because that’s the country promoting its view, and they’re engaging in that free speech, that’s not my focus. It’s when that’s done covertly and clandestinely or deceptively that we will focus and recognise that that is a serious issue and a breach of Australian law.
Significance
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ASIO said Australia was facing a heightened threat from foreign interference. The Department of Home Affairs said foreign interference was a threat against Australian sovereignty and our ability to advance Australian interests in a global context. They said foreign interference could occur through a range of vectors in a threat could not materialise for many years. They said:
Foreign interference serves the strategic, political, military, social or economic goals of foreign states and other foreign actors, at the expense of Australia’s.
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Human Rights Watch discussed the various countries involved in foreign interference and highlighted the role of the Chinese Government, saying:
Yes, absolutely, if you had a protest on West Papua at university, no doubt the Indonesian government would be calling and asking for that to be cancelled. But you don’t see universities caving to the demands of those other governments in the way that they do cave to the demands of the Chinese government.
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CSCRC said foreign interference was significant due to its subtlety and this was compounded in an increasingly complex global environment:
Infiltration and interference through the higher education and research sectors has the potential to be especially insidious through its subtlety. Hence, this inquiry is both timely and pertinent, particularly in light of the shifting geopolitical environment.
Undisclosed foreign influence
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Foreign influence was defined and contextualised by ASIO:
Foreign interference is different from foreign influence. All foreign states take actions to influence deliberations of importance to them. This is a normal part of statecraft and is acceptable when those actions are taken in the open. Foreign interference is a much more nuanced concept.
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The UFIT guidelines noted:
All governments, including Australia’s, try to influence deliberations on issues of importance to them. These activities, when conducted in an open and transparent manner, are a normal aspect of international relations and diplomacy and can contribute positively to public debate.
Prevalence and characteristics
2.111
No information was provided to the Committee as to the prevalence, characteristics or significance of undisclosed foreign influence.
Threat actors
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Noting the national security risks require the element of a state-based actor in their definition and construction, the Committee considered which countries were actually perpetrating these risks. Due to the classification of that material the Committee is unable to report it in an unclassified way. In relation to which, or how many, threat actors were operating in the sector in relation to the national security risks ASIO said:
One country in particular is highly active, but they are not alone in that endeavour. So we don’t just focus on one country. One country might be at it more than others, but there are more that we turn our mind to and do come up against in this space.
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Human Rights Watch discussed this issue and said all parties should be willing to name China as the predominant threat actor in this regard, saying:
There’s been reluctance from some of our government departments and reluctance from some of our universities to use the ‘C’ word – by that, of course, I mean China. We’re not going to beat around the bush here. It is one government that is behaving in this way.
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In response to the number of threat actors ASIO said:
I generally don’t like giving numbers. It’s way more than one but it’s fewer than 10, in terms of the countries we currently worry about. But that can change.