Explanatory Memorandum
(Circulated by authority of the Treasurer, the Hon Peter Costello MP)Outline and Financial Impact Statement
The Intelligence Services Act 2001 ('the ISA') came into force on 29 October 2001. The ISA stemmed largely from the 1995 Commission of Inquiry into the Australian Secret Intelligence Service (ASIS) - one of the key findings of this Inquiry was the need for a legislative base for ASIS. The ISA also established legislative bases for the activities of the Defence Signals Directorate (DSD), and for the Parliamentary Joint Committee on the Australian Security Intelligence Organisation (ASIO), ASIS and DSD (PJCAAD), which replaced the former Parliamentary Joint Committee on ASIO.
In March 2004, the Prime Minister announced an independent review of the Australian foreign intelligence community including, inter alia , the effectiveness of oversight and accountability mechanisms; the suitability of the current division of labour among the agencies; the contestability of intelligence assessments and the adequacy of current resourcing of intelligence agencies. Mr Philip Flood AO conducted the Inquiry into Australian Intelligence Agencies ('the Flood Inquiry') and submitted his report to the Prime Minister in July 2004. The Government subsequently agreed to accept the recommendations of the Flood Inquiry, with the exception of the proposal to change the name of the Office of National Assessments (ONA).
The Bill implements several recommendations from the Flood Inquiry that require legislative amendments to be implemented, namely:
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- The mandate of the PJCAAD should be extended to all of Australia's intelligence agencies - that is, it should also cover ONA, the Defence Intelligence Organisation (DIO) and the Defence Imagery and Geospatial Organisation (DIGO) on the same basis as it currently covers ASIO, ASIS and DSD. The parliament may consider renaming the committee as the Parliamentary Joint Committee on Intelligence and Security.
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- The functions and ministerial accountabilities of DIGO should be formalised in legislation by amendments to the ISA. Similarly, the Inspector-General of Intelligence and Security Act 1986 ('the IGIS Act') should be amended to include scrutiny of DIGO on a basis comparable with that which applies to DSD and ASIS.
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- The mandate of the Inspector-General of Intelligence and Security (IGIS) should be extended to allow IGIS to initiate inquiries at his or her own discretion into matters relating to ONA and DIO without ministerial referral, consistent with the IGIS jurisdiction in respect of ASIO, ASIS and DSD. The Inspector-General should also conduct a periodic review of ONA's statutory independence.
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- The Office of National Assessments Act 1977 ('the ONA Act') should be amended to remove the references to two assessments board - the National Assessments Board and the Economic Assessments Board - to reflect the reality that there is only one National Assessments Board which covers strategic, political and economic issues, but with provision for different composition according to subject matter. The Act should also be amended to strengthen ONA's community coordination role in section 5(1)(d).
The Government has also agreed that this legislative package include the further amendments that have been agreed as a result of a review of the ISA coordinated by the Department of the Prime Minister and Cabinet (PM & C). This review was initially suggested in the 2002 and 2003 Annual Reports of the IGIS. These reports recommended a review of the operation of the ISA on the basis that its application had shown some refinement was needed. In addition, increased public interest in the activities of intelligence agencies and the ability of some agencies to impact on the privacy of Australians warranted an examination and fine-tuning of accountability mechanisms.
In August 2004, the PJCAAD proposed to the Government that it consider a number of changes to that committee, including an increase in the size of the committee and other adjustments to help the PJCAAD respond to its increasing workload. The Government agreed that these proposals would be considered in the context of the wider review of the ISA. As a result, the Government has agreed that the committee's membership be increased from seven to nine, a position of Deputy Chair be established, and the committee be empowered to establish subcommittees when required.
Financial impact statement
The amendments made by the Intelligence Services Legislation Amendment Bill 2005 have no financial impact.