Referral
1.1
The Intelligence and Security Legislation Amendment (Implementing Independent Intelligence Review) Bill 2020 (the bill) was introduced to the Senate by Senator Jenny McAllister on 26 February 2020.
1.2
On 27 February 2020, the Senate Selection of Bills Committee referred the bill to the Senate Finance and Public Administration Legislation Committee (the committee) for inquiry and report by 26 June 2020.
1.3
The Senate Selection of Bills Committee noted that the bill was being referred because it relates to policy issues "that would benefit from input from the affected agencies and other interested stakeholders in civil society".
1.4
The Senate subsequently granted extensions of time for reporting, initially until 14 October 2020 and then 9 December 2020.
Conduct of the inquiry
1.5
The committee advertised the inquiry on its webpage, and set 28 April 2020 as the closing date for submissions, which it later extended to 25 June 2020. Details of the inquiry, including links to the bill and associated documents were made available on the committee's website at: https://www.aph.gov.au/senate_fpa.
1.6
The committee also wrote to a number of key stakeholder groups, organisations and individuals to notify them of the inquiry and invite submissions. The committee received four submissions, which are listed at Appendix 1. The submissions were also published on the committee's inquiry webpage.
1.7
The committee held a public hearing in Canberra on 10 November 2020. It heard evidence from a number of witnesses, including Professor George Williams, Dr Keiran Hardy, the Australia Institute (represented by Mr Allan Behm and Mr Bill Browne) and officers from the Attorney-General's Department and the Department of the Prime Minister and Cabinet. A list of witnesses is provided at Appendix 2.
Acknowledgements
1.8
The committee would like to thank the organisations and individuals who provided written submissions to the inquiry, and those who provided evidence at the public hearing. Your efforts have greatly assisted the committee in its deliberations.
Structure of the report
1.9
This report consists of two chapters. Chapter 1 provides some background to the inquiry and outlines the key provisions of the bill. Chapter 2 considers the key issues raised by stakeholders and sets out the committee's view of the proposed legislation.
Background to the bill
1.10
On 7 November 2016, the then Prime Minister, the Hon. Malcolm Turnbull MP, announced that Mr Michael L'Estrange, AO and Mr Stephen Merchant, PSM had been tasked with conducting a review of the Australian Intelligence Community (AIC).
1.11
The terms of reference for the 2017 Independent Intelligence Review (the 2017 Review) required the reviewers to consider, among other things, the effectiveness of the current oversight and evaluation arrangements for Australia’s intelligence agencies, and to consider the environment within which the intelligence community operates.
1.12
In undertaking the 2017 Review, the reviewers called for submissions and consulted with intelligence agencies, ministers, members of the opposition, government departments, and various people with informed views on intelligence matters. Further, the reviewers also met with the Inspector-General of Intelligence and Security (IGIS) and with Five Eyes intelligence agencies and colleagues in New Zealand, Canada, the United States, and the United Kingdom.
Findings of the 2017 Review
1.13
The reviewers reported their findings to the Australian Government in June 2017. On 18 July 2017, the then Prime Minister released an unclassified version of the 2017 Review’s final report. The reviewers summarised their findings as follows:
The 2017 Independent Intelligence Review found that Australia’s intelligence agencies are highly capable and held in high regard by their international partner agencies. The Review also found that as a result of transforming geopolitical, economic, societal and technological changes, the intelligence community will be faced with challenges that will intensify over the coming decade.
To ensure the intelligence community is best-placed to meet these challenges, the Review makes a series of recommendations to provide a pathway to an even higher level of collective performance. These recommendations broadly cover four priority areas: the co-ordinating structures of the intelligence community, new funding mechanisms to address capability issues, the streamlining of legislative arrangements, and measures to further strengthen the state of trust between the intelligence agencies and the Australian community of which they are part.
1.14
The report identified that, although much of the work of intelligence agencies, by necessity, must remain secret, it is critical for democracy that these agencies are subject to robust oversight and accountability regimes. Specifically, the report stated that:
… oversight of intelligence services is a central tenet of the 'state of trust' between intelligence services and the community of which they are part. A critical element of this 'state of trust' is the understanding that agencies provide intelligence which contributes to safeguarding national interests and the lives of citizens and that, in doing so, those agencies act with propriety, legality and proportionality, are responsive to Ministerial direction and control, and are accountable for their activities.
Since much of the work of intelligence agencies is necessarily secret, many of the traditional means by which the broader community can determine that government agencies are operating in an appropriate manner are not fully applicable to the intelligence community. Intelligence agencies need purpose-designed, strong institutional safeguards and arrangements.
1.15
The report noted that the 1974 and 1983 Hope Royal Commissions addressed these issues, and various governments subsequently established a combination of government, parliamentary and independent oversight mechanisms (complemented by increased ministerial oversight and accountability to parliament), which remain in place today. In assessing the adequacy of these arrangements, the reviewers concluded that:
In our view, [the arrangement] strikes an appropriate balance between the need for intelligence agencies to function with confidentiality, to be operationally effective (subject to checks and balances applied by legislation and responsible Ministers) and the requirement for robust accountability in a democratic society.
Accordingly, we consider the broad architecture of Australia’s oversight arrangements remains appropriate and does not require fundamental change. Rather, our recommendations … focus on the components of the architecture. We consider changes are needed to some of these components to ensure they are able to cope with the increasing complexity and size of Australia’s modern national intelligence enterprise.
1.16
The report identified the need for oversight arrangements to be expanded to cover the ten members of the National Intelligence Community, rather than just the six members of the Australian Intelligence Community (AIC). Specifically, the report stated that:
… the intelligence enterprise that supports Australia’s national security is no longer limited to the six AIC agencies. The contemporary threat environment, particularly the rise of terrorism and irregular immigration as major concerns, means that the intelligence capabilities of the AFP, the Department of Immigration and Border Protection (DIBP), the Australian Transaction Reports and Analysis Centre (AUSTRAC) and the Australian Criminal Intelligence Commission (ACIC) also make a critically important and increasingly significant contribution to national security. The intelligence capabilities of these agencies allow some activities to be undertaken that can impact significantly on Australian citizens. Furthermore, there is a need for increased collaboration as well as a greater sharing of capabilities and information across the ten intelligence agencies of the National Intelligence Community (NIC). We consider, therefore, that there is a compelling case for a consistent oversight regime to apply to all the intelligence capabilities that support national security, across the ten agencies of the NIC.
1.17
The report also highlighted the importance of the work undertaken by the Parliamentary Joint Committee on Intelligence and Security (PJCIS) in terms of important accountability mechanisms for the intelligence agencies, and the need for that committee to be supported by adequate legislative arrangements. Specifically, it said:
In recent years the Committee has…undertaken a range of value-adding reviews of proposed changes to counter-terrorism and national security legislation. Since 2014, Parliament has passed eight pieces of counterterrorism and national security legislation which have enhanced the powers available to law enforcement, security, intelligence and prosecution agencies. Upon introduction, all Bills have been referred to the PJCIS for inquiry and report and the Committee has made a number of recommendations, the majority of which have been accepted by the government of the day, to make contentious legislation more workable.
… We agree that the oversight role of the PJCIS should be enhanced. In framing our recommendations on this issue, we have been particularly conscious of the need to reinforce and build on the valuable role the Committee has played, and to ensure that changes to its role should strengthen the overall compliance architecture and certainly not weaken it by introducing disproportionate compliance burdens or undesirable duplication. We have also considered the remits of Parliamentary Committees in the Five Eyes partners that have oversight of the activities of intelligence agencies, including their operations.
Government response to the 2017 Review
1.18
According to the bill’s Explanatory Memorandum, the Government has yet to issue a formal response to the 2017 Review. Relevant Ministers have, however, expressly accepted most of its recommendations.
1.19
In releasing the report, an accompanying media release on behalf of several Government Ministers noted that the Government had ‘accepted the recommendations of the Australian Intelligence Community review as a sound basis to reform Australia’s intelligence arrangements’. It further observed that the reforms were ‘significant and complex’ and would therefore ‘take time to fully implement’.
1.20
The Government has taken steps to implement a number of the Review’s recommendations, including:
enabling the ONI to have a leadership and coordination role across the NIC (via funding and legislative amendments in 2018);
separating the Australian Signals Directorate into a separate statutory agency, outside of the Department of Defence (via legislative amendments in 2018); and
providing additional funding in 2018 to implement the recommendations to expand the jurisdiction of the IGIS and to increase its staffing from 17 to 55 full-time equivalent staff.
Purpose of the bill
1.21
The Inspector-General of Intelligence and Security (IGIS) has jurisdiction over the following six Australian intelligence agencies, in order to consider the legality and propriety of their activities:
Australian Security Intelligence Organisation;
Australian Secret Intelligence Service;
Australian Geospatial Intelligence Organisation;
Australian Signals Directorate;
Defence Intelligence Organisation; and
the Office of National Assessments.
1.22
The bill seeks to implement two recommendations which were made by the 2017 Review which relate to the IGIS, the PJCIS and the oversight and evaluation arrangements of the Australian intelligence community.
1.23
The two recommendations are as follows:
Recommendation 21: The oversight role of the Parliamentary Joint Committee on Intelligence and Security and the Inspector-General of Intelligence and Security be expanded to apply to all ten agencies within the National Intelligence Community, with oversight of the Australian Federal Police, the Department of Immigration and Border Protection, and the Australian Criminal Intelligence Commission limited to their intelligence functions, and with current oversight arrangements in relation to the Office of National Assessments applied to the Office of National Intelligence.
Recommendation 23: The role of the Parliamentary Joint Committee on Intelligence and Security (PJCIS) be expanded by amending relevant legislation to include:
(a)
a provision enabling the PJCIS to request the Inspector-General of Intelligence and Security (IGIS) conduct an inquiry into the legality and propriety of particular operational activities of the National Intelligence Community (NIC) agencies, and to provide a report to the PJCIS, prime minister and the responsible minister;
(b)
a provision enabling the PJCIS to review proposed reforms to counter‑terrorism and national security legislation, and to review all such expiring legislation;
(c)
provisions allowing the PJCIS to initiate its own inquiries into the administration and expenditure of the ten intelligence agencies of the NIC as well as proposed or existing provisions in counter-terrorism and national security law, and to review all such expiring legislation;
(d)
provisions enabling the PJCIS to:
request a briefing from the Independent National Security Legislation Monitor (the Monitor);
ask the Monitor to provide the PJCIS with a report on matters referred by the PJCIS; and
for the Monitor to provide the PJCIS with the outcome of the Monitor’s inquiries into existing legislation at the same time as the Monitor provides such reports to the responsible Minister; and
(e)
a requirement for the PJCIS to be regularly briefed by the Director‑General of the Office of National Intelligence, and separately by the IGIS.
1.24
To achieve the bill's objectives, it proposes to amend the following four Acts:
Inspector‑General of Intelligence and Security Act 1986;
Independent National Security Legislation Monitor Act 2010;
Office of National Intelligence Act 2018; and
Intelligence Services Act 2001.
1.25
The 2017 Review included additional recommendations which related to the resourcing and funding of oversight bodies. This bill, however, does not implement those particular recommendations.
Commencement of the bill
1.26
All of the amendments made by the bill would commence on the day after it received Royal Assent.
Financial and regulatory impact
1.27
The Explanatory Memorandum does not discuss the financial or regulatory impacts, if any, of the bill.
Compatibility with human rights
1.28
The Explanatory Memorandum notes that, by increasing the capacity of the oversight bodies that review national security and intelligence legislation and issues, the bill is compatible with human rights and promotes their protection.
1.29
The Parliamentary Joint Committee on Human Rights noted (in Report 4 of 2020) that it had no comment in relation to the bill, on the basis that the bill did “not engage, or only marginally engage, human rights; promote human rights; and/or permissibly limit human rights”.
Legislative scrutiny
1.30
On 2 April 2020, the Senate Standing Committee for the Scrutiny of Bills also stated that it had no comment in relation to the bill.
Provisions of the bill
1.31
The bill comprises three schedules which amend four Acts. The following section summarises the bill's key provisions.
Schedule 1—Expanding the functions of the IGIS and PJCIS
Amendments to the Inspector‑General of Intelligence and Security Act 1986
1.32
Items 1 to 5 and items 12 to 15 of Schedule 1 would implement part of Recommendation 21 of the 2017 Review – that the oversight role of the IGIS be expanded to apply to all ten agencies within the NIC. This would include oversight of the Australian Federal Police (AFP), the Department of Immigration and Border Protection, and the Australian Criminal Intelligence Commission (ACIC) (limited to their intelligence functions). Current oversight arrangements in relation to the Office of National Assessments (ONA) would also be applied to the Office of National Intelligence (ONI).
1.33
Items 6 to 11 of Schedule 1 would implement Recommendation 23(a) by amending the relevant legislation to include a provision which would enable the PJCIS to request that the IGIS conduct an inquiry into the legality and propriety of particular operational activities of the NIC agencies. It would also require a report be provided to the PJCIS, the Prime Minister, and the responsible Minister.
Amendments to the Intelligence Services Act 2001
1.34
Items 16 to 18 and 23 to 26 of Schedule 1 would implement part of Recommendation 21 of the 2017 Review – that the oversight role of the PJCIS be expanded to apply to all ten agencies within the NIC, including oversight of the AFP, the Department of Immigration and Border Protection, and the ACIC (limited to their intelligence functions). Current oversight arrangements in relation to the ONA would also be applied to the ONI.
1.35
Items 19 to 20 of Schedule 1 would implement Recommendation 23(b) by amending relevant legislation to include a provision which would enable the PJCIS to review proposed reforms to counter-terrorism and national security legislation, and to review all such expiring legislation.
1.36
Item 21 of Schedule 1 would implement Recommendation 23(c) by including provisions which would allow the PJCIS to initiate its own inquiries into the administration and expenditure of the ten intelligence agencies of the NIC (as well as proposed or existing provisions in counter-terrorism and national security law), and to review all such expiring legislation.
1.37
Item 22 of Schedule 1 would insert a new paragraph which would resolve an ambiguity about the interaction between two provisions of the Intelligence Services Act 2001 – subsections 29(2) and 29(3) – which delineate the statutory functions of the PJCIS.
Schedule 2—Independent National Security Legislation Monitor
1.38
Schedule 2 would implement Recommendation 23(d) by including provisions which would enable the PJCIS to request a briefing from the Independent National Security Legislation Monitor (the Monitor). It would also enable the Monitor to provide the PJCIS with:
reports on matters referred to it by the PJCIS; and
reports on the outcome of its inquiries into existing legislation (at the same time as it provides such reports to the responsible Minister).
Amendments to the Intelligence Services Act 2001
1.39
Item 4 would implement the first part of Recommendation 23(d) by adding the Monitor to the list of people who may be requested to brief the PJCIS.
Amendments to the Independent National Security Legislation Monitor Act 2010
1.40
Items 1 and 3 of Schedule 2 would implement the second part of Recommendation 23(d) by creating a mechanism for the PJCIS to ask the Monitor to report on a matter.
1.41
Item 2 would implement the third part of Recommendation 23(d) by requiring the Monitor to provide reports to the PJCIS at the same time as the responsible Minister.
Schedule 3—Regular briefings to the PJCIS by the IGIS and the Office of National Intelligence
1.42
Schedule 3 would implement Recommendation 23(e) by including a requirement for the PJCIS to be regularly briefed by the Director‑General of the Office of National Intelligence (ONI), and separately by the IGIS.
Amendments to the Inspector‑General of Intelligence and Security Act 1986
1.43
Items 1 and 2 would create a new obligation for the Inspector‑General to provide a briefing to the PJCIS once a quarter about the inquiries that the Inspector‑General is to commence, has commenced or has recently completed. These briefings would be conducted in private.
Amendments to the Office of National Intelligence Act 2018
1.44
Items 3 and 4 of Schedule 3 would create a new obligation for the Director-General of the ONI to brief the PJCIS at least twice a year on matters relating to the ONI’s leadership and evaluation functions. These briefings would be conducted in private.