House of Representatives

Second Reading Speech

Ms O'NEIL (Hotham - Minister for Home Affairs and Minister for Cyber Security)

I move:

That this bill be now read a second time.

Australia's security environment is complex, challenging and changing. As the threats to our country evolve, so too must our response. We need to out-think and outmanoeuvre those who seek to harm our national interest, we must expand our capabilities and we must sharpen our response.

The Prime Minister has said that Australia faces the most dangerous strategic circumstances that our nation has looked into since the Second World War. We are living in a time of great global transition which historians will be writing about for a century to come. The choices that the Australian government makes will matter in this history. That is why the information that we have is more valuable and the protection of that information is more important.

ASIO has said to this parliament that the biggest national security threat that we face is espionage and foreign interference. In fact, they say that we are more targeted by these two issues than we have ever been in our history. This is an enormously important statement from an organisation that has been protecting our national interests for many decades.

The matters that ASIO refer to are not some kind of made-up fantasy. There are spies in our country today. They are trying to work their way into government so they can steal Australian secrets. Over time, the approaches of these people evolve and their practices and their tools get better and more targeted. That's why our government must be constantly on the move to prevent them from taking our secrets.

The law reform that is before the parliament today is very important. It ensures greater protection of Australia's most sensitive information. It ensures that we have ongoing monitoring of those highest levels of security clearance, not a set-and-forget approach that assumes stasis. It ensures that we have a strong and consistent standard across government to protect the most valuable information that our country holds.

The Australian Security Intelligence Organisation Amendment Bill 2023 (the bill) contains a suite of amendments to uplift and harden Australia's highest level of security clearance in response to the unprecedented threat we face from espionage and foreign interference and drive shared initiatives and investments to improve interoperability and burden sharing as the Australian government delivers critical national security capabilities.

The reforms in front of the parliament will implement a consistent approach across the Australian government to issuing, maintaining and revoking Australia's highest level of security clearance.

This will reduce the risk of compromise of trusted insiders, maximise the utility derived from shared services to create efficiencies, improve the mobility and agility of our highest cleared workforce - enabling them to move across departments - and ensure the ongoing confidence of our most trusted allies.

We have established a new national capability, comprising a national TOP SECRET vetting authority in the Australian Security Intelligence Organisation and a Quality Assurance Office in the Office of National Intelligence. This capability is underpinned by a new, classified standard for Australia's highest level of security clearance, known as the TOP SECRET-Privileged Access security clearance. This standard establishes stronger mandatory minimum security clearance requirements reflecting contemporary psychological and insider threat research.

The national vetting authority in ASIO will be centrally responsible for issuing this new Privileged Access clearance, which over time will replace the positive Vetting Clearances. The existing operations of those agencies currently responsible for Positive Vetting clearances will similarly be transitioned to ASIO in phases.

Centralising Australia's highest-level security clearance vetting in ASIO leverages ASIO's security intelligence functions, holdings and capabilities to allow a holistic assessment of a person's suitability to hold such a clearance, having regard to the most current and accurate information about the security threats confronting Australia. Drawing on their expertise, ASIO's analysts assess all available information, and use structured analytical techniques to test, retest and contest their assumptions.

The Quality Assurance Office in the Office of National Intelligence will independently assure the quality, consistency and transferability of these security clearances, and drive the uplift of an insider threat capability for sponsors across the Commonwealth.

Responsibility for the issue and management of lower-level security clearances, from Baseline to Negative Vetting Level 2, will remain unchanged. This means that the Australian Government Security Vetting Agency, known as AGSVA, will remain responsible for most of those clearances.

The threat environment

ASIO assesses that espionage and foreign interference is Australia's principal security concerns.

In his 2023 Annual Threat Assessment, the Director-General of Security noted that more Australians are being targeted for espionage and foreign interference than at any time in Australia's history.

Foreign intelligence services are aggressively seeking secrets at all levels of Australian society - to name a few, through public service agencies, universities, defence industry and even through our journalists. They are targeting our security-clearance holders - those with access to Australia's most privileged information, capabilities and secrets.

Whether it is information from Australia's intelligence community or our Five Eyes partners, about Australia's ground-breaking nuclear powered submarines program with US and UK partners, or other advanced defence and intelligence capabilities, Australia's sovereignty absolutely demands that these secrets be protected. We must ensure that those Australians who have access to these privileged insights are suitable to do so and we do that through the bill that's before the parliament today. The reforms I bring forward today therefore put this government at the forefront of efforts to protect our nation from the threats that ASIO has described.

Overview of the bill

The bill will enable the operation of the national vetting capability in five key ways.

First, the bill will provide ASIO with a new function, and introduce a new Part IVA in the Australian Security Intelligence Organisation Act 1979 (the ASIO Act). ASIO's new function enables it to make security clearance decisions for ASIO and non-ASIO personnel alike, perform security vetting, and furnish advice to other authorised vetting agencies for lower-level security clearances issued by those agencies.

Second, the reforms will enable persistent and more frequent evaluations of an individual's suitability to hold a security clearance. This is really important because up until now, the security clearance process has operated at point in time - one test on the day: are you suitable to manage a high-level clearance? This will create a process where that assessment is made on a more ongoing basis. It will enable:

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a stronger and more effective partnership and shared responsibility between ASIO and insider threat capabilities of sponsoring agencies; and

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an integrated, single point of truth about security clearance holders, empowering sponsors to responsibly manage their clearance holders.

This reflects that this is going to continue to be a shared function across government in some ways.

Consent forms the foundation of the new function. Only people who have voluntarily applied for a security clearance and consented to the collection, use and sharing of their information will be affected in this way.

Third, the reforms will ensure that ASIO's use of these new powers is subject to stringent safeguards.

The bill enshrines a robust framework allowing for merits review of ASIO's security clearance decisions and security clearance suitability assessments. With limited exceptions, those affected by ASIO's security clearance decisions will be eligible for internal review under a new statutory framework, as well as external merits review in either the Administrative Appeals Tribunal (AAT) for existing security clearance holders and Commonwealth employees, or by an independent reviewer appointed by the Attorney-General for all other applicants.

The fourth reform before the parliament is that the bill will amend the Office of National Intelligence Act 2018 (the ONI Act) to provide ONI with a new function to drive the uplift of insider threat capabilities across the Commonwealth, and independently assure the quality and consistency of TOP SECRET-Privileged Access security clearances.

ASIO will continue to be overseen by the IGIS, who has powers akin to a royal commission. The IGIS will continue to review ASIO's activities to ensure the organisation acts legally and with propriety, complies with ministerial guidelines and directives and respects human rights.

Finally, to implement all these reforms, the bill will also amend the Administrative Appeals Tribunal Act 1975 and Inspector-General of Intelligence and Security Act 1986.

Conclusion

One of the most important principles that has driven the government's approach to this very important national security aspect of our work is that it is a privilege, not a right, to hold the highest level of Australian government security clearance. These clearances are not titles and rewards - they come with serious ongoing responsibilities with which we expect our clearance holders to comply.

These reforms will ensure that Australia's security clearance framework is uplifted and hardened, and remains at the forefront of international best practice, in the face of a complex, challenging and changing security environment. I commend the bill to the House.

Debate adjourned.