Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

I call the member for Wills.

Peter Khalil (Wills, Australian Labor Party) Share this | Link to this | Hansard source

I'm better looking than the member for Solomon, no?

Luke Gosling (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

I just did you a solid.

Peter Khalil (Wills, Australian Labor Party) Share this | Link to this | Hansard source

I know you did.

Karen Andrews (McPherson, Liberal Party) Share this | Link to this | Hansard source

I will say that I do not think that is an appropriate comment to be making, so please proceed.

Peter Khalil (Wills, Australian Labor Party) Share this | Link to this | Hansard source

Fair enough. I withdraw. Thank you, member for Solomon. The Albanese government is taking decisive action to bolster Australia's national security by ensuring our military secrets remain safe. Australian security organisations have long known that the biggest national security threats faced by Australia are from sophisticated foreign actors. We face such threats not just in physical spaces and in the seas or in the skies but also on a personnel to personnel level. Foreign intelligence services seek to penetrate not just our borders but also the space and time that bounds our information, our knowledge and our technologies. They do this by trying to involve themselves in government, military, academia and business to obtain classified information, understand military capabilities, policy plans and sensitive research and innovation.

In February 2023, the ASIO director-general, Mike Burgess, observed that third-party companies have offered Australians hundreds of thousands of dollars and other significant perks to help authoritarian regimes improve their combat skills. The Defence Amendment (Safeguarding Australia's Military Secrets) Bill comes in response to a string of such reports and concerns. While in some cases our defence and intelligence agencies have been able to prevent former personnel from travelling overseas, there is an overall and bipartisan, I would hope, agreement that this legislation is a necessary and pertinent response to many of the issues that we have seen.

The safeguarding Australia's military amendment—the SAMS—will strengthen Australia's existing legislative provisions to control and prevent the export and transfer of sensitive defence information to foreign militaries. It achieves this by creating an authorisation framework that regulates work performed by former Defence staff members, including both former ADF members and Defence Australian Public Service employees. This means that former Defence staff members categorised as foreign work restricted individuals are prohibited from working for foreign military or government bodies unless authorised. This will include ADF service chiefs as well as the chief and the vice chief. It will include permanent reserve force members of the ADF who provide continuous full-time service, the secretary of the Department of Defence and the head of the new Australian Submarine Agency, as well as all the civilian APS employees of the above.

These staff members will, on passage of this bill, be classified as foreign work restricted individuals and be subject to new restrictions from providing their services and training to relevant foreign countries and organisations. Relevant foreign countries will include all foreign countries unless exempt by the minister's determination. Beyond Defence staff members, Australian citizens and permanent residents will be restricted from providing certain types of training without authorisation, with criminal penalties for non-compliance. This includes Australian citizens or permanent residents seeking to provide training to foreign militaries or foreign government entities in relation to goods, software and technology in part 1 of the Defence and Strategic Goods List, or trading in relation to military tactics, techniques or procedures. It will become a criminal offence for foreign-work-restricted individuals to work for foreign military or government bodies without authorisation, carrying a maximum penalty of 20 years imprisonment. Exceptions to this offence include holding a foreign work authorisation, performing work under a Commonwealth agreement or engaging in specific authorised activities, such as humanitarian aid or UN-related duties.

I want to emphasise that the SAMS bill adopts a commonsense approach to regulating how former defence personnel with sensitive information provide services and training with non-friendly foreign governments. The bill contains sensible and targeted actions that will enhance the government's ability to prevent the unwanted transfer of sensitive defence information to those foreign militaries. The provisions are restricted only to those individuals with knowledge of Australia's world-class defence training in military technology who are engaging in activities that would harm Australia's national security. I also want to highlight that the bill is bigger than just dealing with this issue in Australia. The passage of this legislation will also align our legal framework with those of our partners within the AUKUS security partnership. In the UK the National Security Act 2023, which was enacted in July last year, made it an offence to obtain or disclose protected information, which includes tactics, techniques and procedures, after receiving similar reports of pilots training for foreign governments.

It is important that Australia's national security policies align and are being aligned with our most important partners as we work together on all the challenges that we jointly face. In addition, this bill will be complemented by legislative reform efforts currently underway to strengthen Australia's export control framework. SAMS complements the Defence Trade Controls Amendment Bill 2023 to further strengthen Australia's export control framework by enhancing the protections around the supply of controlled goods and technology within and outside Australia. The SAMS bill also supports the export-licence-free environment between AUKUS partners, unlocking defence trade innovation and collaboration. Together with the Defence Trade Controls Amendment Bill, the SAMS bill will meet the requirement to implement a standard of controls comparable to those of the United States to access the national exemption from US export control licensing requirements under the US Arms Export Control Act.

Strengthening Australia's export control framework will not only protect Australia's defence industry and the knowledge and capability there but, in combination with this bill, will also help facilitate passage of the United States legislation by ensuring that Australia's export control framework is aligned with US export controls. Australian export control reforms are essential to creating a stronger national defence industry. That base is so important, because it's the foundation of the collaboration we're undertaking with our AUKUS partners at the required speed and scale to meet Australia's challenging strategic circumstances and to support our international partners. These combined legislative reforms also open up significant benefits and opportunities for the Australian industry, higher education and research sectors. They are important steps towards establishing seamless technological transfers with our AUKUS partners. Together, the two bills demonstrate Australia's commitment to safeguarding sensitive technology and information shared with the US and the UK through and within AUKUS.

The government, the Minister for Defence and the department are all acutely aware that the measures in this bill can be complex and serious. The drafting of the bill has come after extensive consultation with all the interested and important stakeholders, including the defence industry sector, academia, veterans groups and unions representing many current or former Defence personnel. We are of the firm belief that the Department of Defence will be able to efficiently implement the foreign work authorisation system, including the processing of requests. The bill has also been reviewed by the Parliamentary Joint Committee on Intelligence and Security, which I chair, and by representatives from across the House and Senate. It has been amended in line with some of the committee's recommendations. After an extensive inquiry and review process, the bill has been recommended for passing by the PJCIS as well.

The protection of our nation's secrets and sensitive information is central to preserving Australia's national security and to keeping Australians safe. If I ever had the privilege of flying one of those great planes that the RAAF has—and that is a great privilege—it would also come with the obligation to protect the knowledge and the military secrets that have been gained on those from falling into the hands of any adversaries. I want to acknowledge that we have veterans here in this place; the member for Solomon and the member for Herbert have served in our military, in the ADF. They know the importance of the obligation and responsibility they have given all that they have learned over their years of service to protect that information, knowledge and capability from falling into the wrong hands.

In all seriousness, this is really what the Defence Amendment (Safeguarding Australia’s Military Secrets) Bill is meant to do. It is meant to make sure that, for those of us who have served, both in Defence, as I have, or in the military, as the member for Herbert, the member for Solomon and many other veterans have, when we go about our business in the private sector we can do so with the assurance and confidence that we have sought the right authorisation and are clear to go ahead and do the work that we are doing post our service in the military.

In that vein, I am very, very pleased to extend my strong support for this bill, because it provides a commonsense but also necessary suite of measures to achieve this objective. It complements our defence export controls measures, it brings us into step with our AUKUS allies, it comes as a culmination of extensive consultations with relevant and impacted stakeholders and it comes at a time when the strategic theatres that we operate in and the threats that we face are becoming more and more asymmetrical and more and more difficult to identify. Those asymmetric threats warrant appropriate responses in this legislative framework as part of our response. We need those responses. We need transparent and clear responses. I am proud to say that this is the right approach to counter such threats on all fronts. I commend the bill to the House.

Phillip Thompson (Herbert, Liberal National Party, Shadow Assistant Minister for Defence) Share this | Link to this | Hansard source

I want to take this opportunity to make a few comments on these two very important defence bills that we are considering today—the Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 and the Defence Trade Controls Amendment Bill 2023. I would like to acknowledge my friend the member for Solomon and the member for Wills and his contribution just then and the importance of both of these bills.

As my colleague the member for Canning has already mentioned, the coalition will be supporting this legislation. The Defence Trade Controls Amendment Bill 2023 is a critical path to a smooth implementation of the AUKUS security pact, ensuring that we have the seamless transfer of technology that we and our partners need to enable it. The Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 is crucial to making sure that our foreign militaries and governments aren't given a leg up by somebody who knows the ADF from the inside. I will touch on the second one first and then come back to the trade controls bill.

The Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 came about after concerning reports that a former RAAF fighter pilot may have provided training to Chinese pilots. The reports, quite rightly, triggered an investigation by the joint AFP-ASIO Counter Foreign Interference Taskforce and Defence, looking in part at how the department managed security clearances and other controls for people taking jobs after their military careers. Following the investigation, it was deemed that there was enough evidence to show that more work needed to be done to ensure that the system was rock solid. This bill today is the product of that work.

The vast majority of our former defence members do the right thing. They sign up for service out of national pride and a determination to protect the sovereignty of our nation. They would never dream of sharing military secrets with a foreign military. But, for the extreme minority—a very small group—that might do the wrong thing, there must be absolutely no excuse, no reason and no allowance for that to happen. We are in the most challenging strategic circumstances since World War II. Members of our ADF are naturally targets of foreign intelligence services. ASIO Director-General Mike Burgess said in his February 2023 threat assessment:

Third party companies have offered Australians hundreds of thousands of dollars and other significant perks to help authoritarian regimes improve their combat skills.

In some cases, we and our partners have been able to stop the former insiders travelling overseas to provide the training, but in others, legal ambiguities have impeded law enforcement's ability to intervene.

However the individuals rationalise their decisions, the bottom line is they are transferring highly sensitive, privileged and classified know-how to foreign governments that do not share our values or respect the rule of law.

Our military secrets are not for sale. That's why former defence staff and ADF members must be prevented from working for and transferring sensitive information to foreign militaries, governments or government entities without authorisation from the Minister for Defence. It's why this must also extend to the Australian citizen and permanent residents. There must be a strong deterrent, and, where a person undertakes these activities without authorisation, the maximum penalty is 20 years in prison. We must support the intentions of this legislation to safeguard our national and military secrets, and the coalition will work on a bipartisan basis with the government in the best interests of Australia's national security.

Of course, we need to have some exemptions, and it's important that the minister have the power to make those exemptions to enable cooperation with our security partners. Under this legislation, the minister may grant a foreign work authorisation, cancel an authorisation, suspend an authorisation or vary an authorisation. The minister can also determine a foreign country is not a relevant foreign country, meaning it is not necessary to obtain a foreign work authorisation to work or train there. This means that former members, now veterans, who have critical skills, knowledge and abilities that may be used in a low-risk setting or one of our partners can still work overseas.

What the minister must ensure is that there aren't significant delays in processing requests for foreign work authorisations in those relevant foreign countries. We know how difficult it is already for veterans who leave to figure out where they want to take their lives after service. Sometimes, that means a job overseas in a position that matches some or all of their skills and abilities. I and the member for Solomon both worked overseas post our defence careers. I think we both worked in the Middle East for different organisations. We want to be able to ensure that streamlining of any authorisations is quick, because contracts come up quickly, and we don't want people to be worse off because of any red tape.

There must be absolutely enough time given to examine each case properly and in detail; that must be a priority. The minister must ensure the department has the resources to conduct those processes without us seeing large backlogs or any wait times. We also need to ensure our people—our ADF members and APS employees—are well aware of their obligations under this legislation when they leave their employment. Twenty years is an extremely significant penalty, and it needs to be. But those who could potentially face it must be educated and warned about it so that there is no ambiguity. No-one should be able to say that they didn't know.

Finally, on this bill, it is reassuring that the definition of 'defence staff' does not include Defence's external workforce, consultant contractors and outsourced service providers, as we know contractors are equal to nearly 50 per cent of Defence's APS workforce. The caveat is that they will still, of course, fall under the 'Australian citizens and permanent residents' definition. The coalition will support the Safeguarding Australia's Military Secrets Bill in demonstration of our commitment on this side of the House to the safety and security of our nation.

The Defence Trade Controls Amendment Bill 2023 is critical to strengthening Australia's defence exports framework and facilitates the seamless transfer of technology contemplated by the AUKUS agreement. To do this, we need to have a robust control regime and a streamlined flow of defence trade and technology collaboration with the UK and US. This will include the establishment of an export license treaty environment, which will support industry, education and research sectors in all three nations.

This bill will regulate the supply of certain items on the Defence and Strategic Goods List, or DSGL, and military or dual-use technology to foreign persons within Australia. It will regulate the supply of certain DSGL military or dual-use goods and technology from a place outside of Australia to another place outside of Australia or to a foreign person. It will regulate the provision of services in relation to DSGL part 1 military goods or technology to foreign persons or entities. And it will remove the requirements to obtain a permit for suppliers of certain DSGL goods and technology and the provision of certain DSGL services to the United Kingdom or the United States.

These are positive steps as we move forward with AUKUS and they are steps that will open up further opportunities for small and medium enterprises in Australia. We do want to see the defence minister's words—that Australia will achieve a 'seamless defence industrial base' between Australia and the US—come to fruition. But, at the same time, we need to ensure that industry isn't burdened with extra red tape and costs. I think it's important to note the submission of Ai Group to the exposure draft. They welcome the intent of these amendments and are excited about the licence-free environment with our AUKUS partners, but they are concerned about the impact of additional compliance costs and legal risks to their members and have asked for clear guidelines on the new measures as well as training programs to educate members about the new regulatory regime. We understand the government will propose a range of amendments to the DTCA Bill to address these concerns, and we welcome that.

It's true that there has been a fairly condensed amount of time provided for the consideration of these bills. We understand the time constraints in both the UK and the US that have required us to be dealing with these matters this sitting fortnight, and so, as I've said, we will be supporting passage of this legislation through the House. But, as a result, it is important that we have safeguards and points of review to ensure this legislation is operating as it should. That's why the coalition's support has been provided on the basis of enhancing the co-design of regulations for the defence export framework, with recommended industry working groups participants representing Australian sovereign SMEs and a statutory review time frame of three years from commencement to evaluate the functioning of the updated defence export legislation and framework.

In addition, and probably most importantly, we have a commitment from the Deputy Prime Minister to establish a new statutory parliamentary joint committee on defence as soon as possible. This will be a committee that can have proper oversight of defence matters, including the ADF and the Department of Defence, with access to classified information. Without it, parliament can't exercise proper civilian oversight of our military and defence public servants. It has been a long process to get to this point, but it is good that we have secured a commitment that draft legislation to enable it will be available within weeks, not months. With those assurances in mind, I commend these bills to the House.

Luke Gosling (Solomon, Australian Labor Party) Share this | Link to this | Hansard source

From the outset, as the Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 is about safeguarding our military secrets, I will acknowledge the presence in the chamber and the service of the members for Menzies and Herbert. I also acknowledge the member for Wills, the Chair of the Parliamentary Joint Committee on Intelligence and Security, and the member for Fisher, the deputy chair, for their diligent work on the SAMS inquiry.

Our government is taking decisive action to bolster Australia's national security by ensuring that our military secrets remain safe. Keeping our secrets in Australian hands is essential to preserving our national security and maintaining the trust of our like-minded security alliance and other partners. While this SAMS bill does not represent the entirety of our legislative ambition in this respect—for example, there are some issues that were identified through the PJCIS inquiry that will be addressed at other times and in other ways—it is an important step towards establishing more seamless tech transfers with our AUKUS partners. I'm very proud to have started, with the member for Casey, the Parliamentary Friends of AUKUS, and we are working hard to make sure that this arrangement is better understood, in the interests of all countries involved, with the ability for like-minded countries to keep the world open and fair.

Australia already has a range of robust legislative measures and policies in place to deter and respond to the risk of foreign collection of our defence secrets; I think it's important to state that upfront. It's not as if our government or the former government have just worked out that we need to extend measures, but this bill does exactly that. It extends the measures that already exist. We protect our sensitive defence information, including through relevant offences under the Criminal Code Act 1995 and secrecy provisions. Australians who work, or have worked, in defence who come into possession of the nation's secrets have an obligation to maintain those secrets beyond their employment with the Commonwealth. The Criminal Code, for instance, contains general secrecy offences that apply to current and former Commonwealth officers, including ADF personnel, who harm the national interest by disclosing the information entrusted to them, and the code specifically prohibits the provision of military-style training involving a foreign government principal. This is an enduring obligation; to reveal any of those secrets is already a crime.

This bill extends Australia's already robust legislation and policies further, strengthening Australia's existing laws by protecting the export and transfer of sensitive defence information to foreign militaries. It will create a new framework, which will require certain individuals to seek authority to perform, work for or train with foreign militaries. It's about protecting our knowledge, skills and experience as well as regulating the military training that Australians may provide to foreign countries. The legislation delivers on the Deputy Prime Minister's commitment to strengthen Australia's legislation, following the investigation he instigated into reports that ex-ADF-personnel were being approached to provide military training to foreign countries.

These sensible reforms will be confined to only those individuals with knowledge of Australia's world-class defence training and military technology who are engaging in activities that would harm Australia's national security. This includes former defence staff members—both Australian Defence Force members and APS members—seeking to perform work for or on behalf of foreign militaries, and Australian citizens and permanent residents seeking to provide training to foreign militaries in relation to items in part 1 of the Defence and Strategic Goods List or in relation to military tactics, techniques and procedures.

The government's sensible, decisive and timely approach is in stark contrast to the former Coalition government's, who were warned about this security issue two years ago and did nothing to address it. I'm sure those on the other side will have an opportunity to speak to that. I have it on good authority that the then Minister for Defence and now opposition leader, Peter Dutton, was warned in mid-2021 about alleged attempts to recruit former ADF personnel to train China's military. The opposition leader clearly didn't act on these warnings and did nothing to address the issue, even though it was widely known about as far as I am aware.

This legislation also bring us into line with the approach taken by our like-minded partners to protecting their own military secrets, and this includes a greater alignment with the US approach under its International Traffic in Arms Regulations. People may have heard that referred to as ITARS. These important reforms are also needed to ensure we have the necessary safeguards in place to unlock the potential of AUKUS and the benefits it brings to Australia.

The penalty for performing work for or specified training with a relevant foreign country without authorisation is 20 years imprisonment. An individual will not commit an offence if they have been granted an authorisation for the work or training.

A division having been called in the House of Representatives—

Sitting suspended from 17:09 to 17:20

There are also other exceptions to the offences created by this bill. They include if an individual's work or training is in relation to providing aid of a humanitarian nature or if the individual performs an official duty for the United Nations, an agency of the United Nations or the International Committee of the Red Cross. An exemption also covers work or training in the course of an individual's employment or engagement by the Commonwealth.

This bill will enable the Minister for Defence to determine, by legislative instrument, which countries are not to be regarded as relevant foreign countries under this framework. That means that, if an individual intends to work or provide training to a foreign country listed on the instrument, the individual would not be required to apply for an authorisation. This bill will also enable the Minister for Defence to determine, by legislative instrument, a class of former defence staff members who are not required to apply for an authorisation. The class may be determined by the type of work previously performed by that member and the period of time that has elapsed since the performance of that work.

This authorisation framework is not intended to prevent Australians from working overseas or with foreign governments or militaries. Rather, our legislative intent is to prevent individuals with knowledge of sensitive defence information from training or working for certain foreign militaries or governments where that activity would put Australia's national security at risk. This bill will ensure individuals in possession of sensitive defence information who want to undertake these activities must first seek authorisation to do so. This is to ensure their activities are not damaging Australia's national interests.

The measures in this bill are serious and vital, and that is why the bill was the subject of an inquiry by the Parliamentary Joint Committee on Intelligence and Security, which I am a member of. The committee agreed with the need for these reforms and noted the importance of the passage of this bill in providing AUKUS partners with an assurance of Australia's commitment to the security of military secrets. Throughout the inquiry process, the committee heard that most submitters were supportive of the need for the bill. Our bipartisan report recommended that the bill be passed.

This is an important piece of legislation that will keep our country safe by preventing potential threat actors from leveraging former ADF members' classified knowledge of tactics, techniques and procedures. Defence members know that their nation entrusts them with the high honour of safeguarding our Commonwealth's most sensitive secrets. Veterans are the lifelong guardians of these secrets, even after they separate from the Australian Defence Force, and this bill will make it easier for all members and veterans to know how to safely manage their classified knowledge. No-one who does the right thing will be adversely affected, and the right thing will be to apply for authorisation if an opportunity comes up to work with a foreign military. It isn't a ban on such contracts, though there is a requirement to seek authorisation.

We have a deep and vital interoperability with the armed forces of our closest allies. For example, our Australian submariners are currently training in the US Nuclear Power School to prepare the way for our acquisition of nuclear powered submarines, and that won't be constrained by the bill. What the bill does is create a straightforward process that will ensure that ADF members and veterans have a clear sense of their left and right of arcs and their responsibility as guardians of our nation's secrets, both in and out of uniform. It's a crucial piece of legislation, and I commend it to the House.

Andrew Wallace (Fisher, Liberal National Party) Share this | Link to this | Hansard source

I rise in support of this cognate debate in relation to the Defence Trade Controls Amendment Bill and the Defence Amendment (Safeguarding Australia's Military Secrets) Bill. After doing a little bit of research, I discovered that the genesis of the safeguarding Australia's military secrets bill goes back more that a hundred years, probably much further than that. I would hazard a guess that protecting one's military secrets goes back as far as the military profession itself. In what is now known as the Sempill Mission, which dates back to the 1920s, British aviators trained Imperial Japanese Army aviators on how to conduct naval warfare on aircraft carriers. That instruction of Japanese aviators obviously had a very significant empowering impact upon the Imperial Japanese Navy, which led to the Pearl Harbor attacks on 7 December 1941. So it's very important that we learn the lessons from that unfortunate incident.

The first we heard of a modern day version of such an incident was back in October 2022, when it was alleged that some 30 Royal Air Force pilots were conducting training for the Chinese People's Liberation Army Air Force. That sent shockwaves throughout the Western world. It wasn't just RAF pilots; it was also Royal Navy pilots and Royal Army pilots training Chinese pilots. I want to take issue with a comment in which the member for Solomon indicated that this dates back to a time when the current Leader of the Opposition was the defence minister. At the very earliest, the first time this was made public in England was in October 2022. I am disappointed that the member for Solomon has tried to besmirch the opposition leader on that point, but I digress a little bit.

The SAMS bill, as I'll call it, came before the Parliamentary Joint Committee on Intelligence and Security and was treated with some haste. That is something that I, as the deputy chair of the PJCIS, do not like doing. I don't like conducting business in a hasty fashion—pardon the pun—because rushed legislation often leads to errors, unforeseen circumstances and unforeseen problems. But in this case both the SAMS bill and the Defence Trade Controls Amendment Bill need to be rushed through the Australian parliament to be done and dusted by the end of March. Why? There are pressing matters that require us to pass this legislation to satisfy US and UK legislation. They have passed legislation, through both the UK parliament and the US Congress, which effectively requires us, as part of the AUKUS arrangement, to get these bills through expeditiously. As I say, it's not something that we like doing, but it's something that we needed to do.

As you may have gathered from my initial comments about the SAMS bill, it is incredibly important that we protect the training, tactics and techniques of the Australian Defence Force. That isn't just restricted to pilots. There are many tactics, techniques and procedures of numerous roles within the ADF that we would not want passed on to adversaries, whether it be those of our special forces in the Army, submariners in the Navy or fighter pilots in the Air Force. So we need to ensure that our legislation properly equips the Australian government to prevent that exchange of information to foreign governments and militaries. It is as old as the history or the profession of a soldier to re-engineer how an adversary does something—to try and improve upon it yourself—and that's why we need to be very careful that we don't arm our adversaries with that vital information.

I want to acknowledge at this stage the great work that was done by former prime minister Scott Morrison, the former defence minister and now Leader of the Opposition, and Senator Reynolds in putting and stitching the AUKUS deal together, because we would not be here talking about these two bills but for AUKUS. AUKUS provides an avenue for us to be able to secure the crown jewels of defence—namely, the nuclear propulsion of a submarine, which has not been provided to any other country other than the UK since the 1950s. So that nuclear propulsion technology is regarded as the crown jewels, and there are many countries that would love to be able to get information about how that propulsion is designed and operated. That's just to put that into context—we would not be here today talking about these two bills but for the AUKUS deal landed by the former prime minister.

This is a some $270 billion program that will set Australia up with very significant defensive capabilities, and these nuclear propelled submarines give us the competitive edge that we may need. Hopefully, we'll never need it. No-one wants to enter a conflict, but, if we are to deter our adversaries from starting a conflict, this is how we do it. We ensure that our men and women of the ADF have the appropriate tools, skills and equipment to deter aggression by our competitors.

The SAMS bill does not outlaw a former ADF member going and working overseas. What it does do is require that former ADF member, or an Australian citizen or resident, to get an authorisation from the defence minister to enable them to go and work overseas. That should not be considered to be an extraordinary thing. There will be an opportunity for the defence minister to carve certain countries out by regulatory instrument—you might think, ultimately, that will be Five Eyes countries—and there will be instances where certain professions within the ADF might also be carved out by instrument. No-one's suggesting that a cook might provide certain information to an adversary that would be deleterious—unless you're Steven Seagal, of course! I will look at the defence boffins and see if they know who Steven Seagal is. It's probably an age thing. But I digress.

The SAMS bill will enable Australian former ADF members to be able to work overseas and work with foreign militaries and governments provided they get the appropriate authorisation from the defence minister. There will be a number of exemptions that will be provided. There will be certain things that the defence minister or the department will look at—namely, how long it has been since person has been in a particular role. It may be the case that, in some instances, it doesn't matter how long you have been out of the ADF you will not get an authorisation to, for instance, work for or in China. Submariners would come to mind as a trade or a profession where we wouldn't want that knowledge passed on. But for someone who perhaps worked in signals 10 or 15 years ago that may be something where we would regard those skills as having expired or the value of which expires over time.

The bill itself is very commendable. The PJCIS committee examined the bill. We made a number of recommendations to the government. I am hopeful that the government has accepted those recommendations, because it's very common for a government to accept the recommendations of the PJCIS. One of them in particular was this. When the bill came before the committee, it made no reference to banning a former ADF member from providing services to a militia. We all know that in some cases it's very hard to tell the difference between a government military, or a military that is the tool of a sovereign government, and militia forces. So the committee recommended that the bill be amended to reflect that.

The urgency for these bills, as I indicated earlier, is that the government has indicated that, since the United States Congress passed the National Defense Authorization Act in December 2023, the timetable for passing these bills needs to be accelerated. Australia cannot be left behind in relation to AUKUS. This is an arrangement that benefits not just Australia; it is an arrangement through which we will, through the other pillars, have a mutually beneficial arrangement. I think we are kidding ourselves if we don't understand that AUKUS is a huge win for the Australian people, because that is exactly what it is. We don't want to be in a position where Australia holds things up. If the US Congress and the UK parliament have done what they need to do, we don't want to be the laggard. Indeed, the NDAA requires the US Congress, with the certification of the US president, to be satisfied with Australia's progress in implementing security and export frameworks within 120 days of the NDAA's enactment. The first certification date is 20 April 2024. That is in less than one month. So naturally the government seeks to expedite the passage of the SAMS and the DTCA through both chambers by the end of the March sitting fortnight.

I just want to say, if there are any members from the defence department in the chamber today, these bills—SAMS, in particular—will be scrutinised by the new defence committee. We don't want to see inordinate delays of authorisations. This is critical because small, medium and large businesses rely upon timely authorisations under this act. The new committee will scrutinise the defence department's expeditious handling of these authorisations very closely. (Time expired)

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Assistant Minister for Defence) Share this | Link to this | Hansard source

The Deputy Prime Minister referred the Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 to the Parliamentary Joint Committee on Intelligence and Security for inquiry. I want to thank the PJCIS for its work on this bill, particularly given the fact that the committee has a number of inquiries ongoing at the moment. The committee ultimately recommended the bill be passed and made a number of other recommendations for which I will provide a response on behalf of the government.

In relation to recommendation 1—to expand the exemption to the work authorisation requirement from the International Committee of the Red Cross to include the International Red Cross and Red Crescent Movement—the government agrees in principle. To ensure consistency with other legislation, particularly with the Criminal Code, which has certain defences and exemptions for the Red Cross, Defence has been directed to work with other departments to develop a common approach to addressing the issue, rather than through this bill alone.

In relation to recommendation 2—that the government assess whether existing legislation and procedures sufficiently cover working or training for paramilitary organisations and militias—there is strong existing legislation to address these threats, and Defence will continue to work the Attorney-General's Department to monitor the adequacy of current legislation and procedures in relation to former defence personnel. In relation to recommendation 3—that the words 'that would prejudice the security, defence or international relations of Australia' be added in section 115B—the government considered this closely but does not agree with this recommendation. The provision in section 115B is appropriately targeted and narrow in its application.

Further, requiring a direct linkage between the transfer of military tactics, techniques and procedures related to information and the words 'prejudice the security, defence or international relations of Australia' would make it difficult to enforce the legislation. Military tactics, techniques and procedures information exists across a variety of classifications and formats, making it difficult to establish a traditional link between the classification or nature of information and the damage to national security. The result of this information being lost to foreign militaries may also take significant time to manifest, and it may not be until Australian defence forces are engaged in conflict that the impact of the knowledge transfer and its benefits to a foreign military are fully apparent.

The purpose of this bill is to enhance and extend the existing prohibitions on sharing military secrets. It seeks to ensure that those individuals with knowledge of sensitive defence information do not engage in work or training for foreign militaries, governments or entities that are damaging Australia's national security interests. I can assure the House that this will be reflected in the bill's implementing procedures, authorisation processes and enforcement.

In relation to recommendation 4—that the government consider amending the bill to give the minister the power to allow for bulk application approvals for companies who already have defence export control arrangements approved—this would not be appropriate as, while a company may have defence export control authorisations, individual owners or employees will have an array of complex personnel circumstances which require a case-by-case assessment. Only by assessing each individual on a case-by-case basis is it possible to understand the harm that could be done to Australia's national security as a result of an individual undertaking work or training for a foreign military, government or entity.

Defence will work to ensure the work authorisation process under this bill is as streamlined as possible and is responsive to critical business and personal priorities. The government understands the significant commercial and financial impact that delays in work authorisations could have and has directed Defence to ensure that there is sufficient capacity to process applications as expeditiously as possible while ensuring security arrangements and requirements are met.

Recommendation 5 is that the government assess our existing legislation, that procedures covering former national intelligence community officers and their work for foreign governments be strengthened and that we address the need for further legislation. Noting the critical role of these officers in protecting Australia's national security, Defence will work with relevant Commonwealth agencies to consider the committee's recommendations.

The Defence Trade Controls Amendment Bill was referred to the Senate Standing Committee on Foreign Affairs, Defence and Trade for an inquiry and report. The government again thanks the committee for its work in conducting the inquiry, which ultimately recommended that the bill be passed without delay. In response to the matters raised by the Senate inquiry in its final report, and as part of the co-design process with stakeholders, I can foreshadow that the government will be moving amendments to this bill.

I'll go through the government's response to those recommendations. In relation to recommendation 1—that the definition of 'fundamental research' be included in the bill itself and consideration be given to including additional exemptions in the bill where possible—the government agrees with this recommendation, and the amendments will be moved to address this. In relation to recommendation 2 on the definition of 'Australian persons' and its inconsistency with the United States' definition, the definition of 'Australian person' has been deliberately aligned with the definition of 'US person' in the International Traffic in Arms Regulations.

The government would also like to make it absolutely clear that, under Australian law, before any goods and services can be provided to an entity or individual on the Department of Foreign Affairs and Trade Consolidated List—a list of all persons and entities listed under Australian sanctions laws—a sanctions permit from the Australian Sanctions Office is required. The amendments in this bill will not override or change this requirement.

In relation to recommendation 3, Defence will continue to undertake consultation and engagement with impacted stakeholders, including industry and the higher education research sectors, through its established working groups. Defence is developing fact sheets for publication on the Defence website and dissemination to impacted sectors via peak bodies. The fact sheets will articulate the legislative changes, what they mean for regulated entities and individuals, next steps and where to obtain information.

In relation to recommendation 4, the government amendments to be moved are the product of co-design with industry. The government has directed Defence to continue the co-design process it has been undertaking through its established working groups for amendments to the subordinate regulations instruments and definitions and in the implementation of this regime.

In relation to recommendation 5, the government agrees it would be beneficial to expand the established working groups to include additional representation from relevant Australian defence small and medium enterprises. It has directed Defence to expand the membership of the working groups accordingly.

In relation to recommendation 6, the government agrees that a relevant parliamentary committee should review the implementation of the reforms within three years of commencement. This is in addition to the three-year independent review of the legislation the government has already committed to.

In relation to recommendation 7, the government agrees that Defence should be appropriately resourced to provide advice to external stakeholders, with this being appropriately publicised. Defence has already commenced work to upgrade the relevant ICT system to support new permit applications and expedited assessment.

Defence is expanding and increasing its education and outreach program, including by developing online learning and education materials that stakeholders can use to support decision-making in relation to permit requirements and other education and guidance materials. The department also has a 1800 number for the public to call to seek assistance or advice.

In relation to recommendation 8—that Defence Export Controls be adequately resourced to undertake its work as efficiently as possible—the government agrees that Defence should be appropriately resourced to support the implementation of this bill.

In relation to the Greens dissenting report, the government does not agree with that recommendation, and the government intends to pass the bill.

Keith Wolahan (Menzies, Liberal Party) Share this | Link to this | Hansard source

I know that time is of the essence in passing and processing these bills, so in that spirit I flag that I won't be using my full time, for those who are preparing to come next.

The most important and fundamental factor in conflict is the will to fight, and that is because war and conflict are fundamentally a human endeavour. Humans are not computers or robots. We have emotions. We are part of groups, tribes, families, units, formations, divisions and nations. In that aspect, the will to fight is so fundamental. If executed properly it means—hopefully—we don't actually have to fight, and that's at the heart of AUKUS. AUKUS isn't about preparing this nation for an actual conflict. It is designed to prevent conflict. It is designed to get inside the heads of potential foes when they are war gaming and lead them to say 'not today'.

As technology evolves, that question of 'not today' is one that has to continuously be asked, and one of the reasons it has to continuously be asked is that technology evolves. AUKUS is a huge, multigenerational, nation-building task in advancing our technology and equipment, and we can't do that if we don't have the mechanisms to protect the secrets that underpin it. But we must never forget that what we are doing here also affects the humans that we rely upon to take great risks and fight in our name. I acknowledge the member for Hunter here. I was in his electorate on Monday to say farewell to the former member for Hunter's son, Jack Fitzgibbon, someone who put on our uniform and was prepared to sacrifice his life—and lost his life—in the service of our nation.

In this nation we have 581,000 veterans, just under 60,000 full-time members of the Defence Force and 32,000 reserves. The SAMS part of this bill puts an anvil over their heads and says, 'If you don't comply with certain requirements, you'll go from being a hero to a criminal.' That's an important but really serious thing that we should acknowledge. The headline offence in SAMS is 20 years in prison—20 years. What we're doing here is important, but we should do it conscious of the regime that we are imposing on current and future ADF members. I hope we never see a prosecution here.

On many other occasions and in many other legislative instruments, particularly in criminal law, we might all furiously agree on what's intended to be captured here, but there will be a future department, a future Director of Public Prosecutions and a future AFP that will have to actually apply what we're passing here. I was given comfort that this doesn't appear to be an offence that is of absolute liability. It still has, on my reading of it, the defence of honest and reasonable mistake. That is a common law defence that also exists in the Commonwealth Criminal Code, in section 9.2. That's fundamental because, again—and acknowledging the human in all of us—sometimes someone might miss the email, or they were sick when the brief was given, or they didn't fill the form in or they didn't pay their mobile bill and receive the confirmation of what they had asked for. Ignorance of the law is not a defence, but the defence of honest and reasonable mistake is more than that. The defence of honest and reasonable mistake is really explained in the words: it's 'honest', and that honesty is subjective to the person who is potentially being accused; and it's 'reasonable'—in an objective standard, a reasonable person would accept that excuse. And I'm glad that defence exists here.

The member for Fisher, quite rightly, said at the end of his address that we really need to make sure that the processing of these forms and the paperwork is done in a timely fashion, and I'll just give an example. Let's say someone has served for 10 years in the ADF and they want to apply to a consulting firm or a defence contractor, but that company or firm does engage in some capacity with a country or nation that has an ambiguity about whether this applies. To be on the safe side, their policy is to go get this approval. And if that approval take eight, 12 or 18 months, that person won't get hired. Eventually, they won't get asked, and we'll have the scenario where, through delay, veterans won't be employed in areas that they're highly suitable for. That's why the defence committee which is going to have oversight of this is so important.

I thank the PJCIS and the corresponding defence committee for the work they do; I know there's a lot of work put on the committee and I thank those who have cooperated to push this forward. I'm grateful that the defence of honest and reasonable mistake is in here; I think that's important, and I urge, as the member for Fisher did, for the future defence committee's oversight of the implementation of this scheme. Our 581,000 veterans are heroes; anyone who signs up to be a member risks having their family stand next to their coffin, as the Fitzgibbons did on Monday. For that, we owe them an enormous debt of gratitude. To then say that some of them will become criminals with an offence that's liable for 20 years, we had better be sure that it's right. We had better be sure. I commend the bill to the House.

Zoe Daniel (Goldstein, Independent) Share this | Link to this | Hansard source

I want to preface what I'm about to say on the Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 and the related bill by stating that I don't begin this speech with an ideological mindset against AUKUS. I well understand the arguments for it, particularly in the world in which we live today. On that basis I welcome the opportunity to speak on these bills, because I think that, as a nation, we need to have this conversation. I will say this: for a project with the eye-watering price tag of $368 billion, we are asked to accept an awful lot about AUKUS as an act of faith: that Pillar II of AUKUS, the subject of this legislation, in effect, will provide the benefits to Australian research and industry predicted by the government; that the US can reboot its industrial base sufficiently to build the submarines promised to Australia; that the US Congress will agree to the sale of two or three of its own subs to Australia as the US struggles to build new subs at a rate to match its own strategic priorities; that Australia has not implicitly undermined national sovereignty in signing up for AUKUS; that the US Congress will agree to sell Australia the first two or three subs without an express commitment to join Washington in conflict with China over Taiwan; that Australia can develop the workforce with the expertise required to develop a nuclear submarine from scratch in the short time frame required; that a small force of nuclear submarines could do what a larger and cheaper force of conventional submarines could not; and that a handful of expensive nuclear subs will prove to be a deterrent, protecting Australia's vital shipping lanes.

Former prime minister Scott Morrison is also a former marketing man. In keeping with that, the big question about AUKUS has always been whether there's less to this megaproject than meets the eye; that it's more about marketing than delivery. And that goes for Pillar II, as well as for the subs themselves. I've met officials, for example, from an Australian defence technology company whose cutting-edge technology has been sought by a major US defence contractor, but the Australian company can't get its foot in the door because of current American restrictions. In theory, one of these bills at least is designed to address that constraint, but there are concerns that it could make it worse by creating a rigid two-way market which the US has outsized power over, while preventing such companies from doing their business with other countries. In short, to get a piece of AUKUS Pillar II, Australian companies will have to sign up to incredibly rigid restrictions and then hope the Americans give them the contracts.

There are also fears in industry that the history of our own defence department is such that even with these new provisions in place, in general it's more content to buy stuff from overseas, and the US in particular, than in encouraging the development of a sovereign Australian defence capability. A cynic might say that the surprise AUKUS announcement at 7 am on 15 September 2021 was more about wedging Labor and escaping the increasingly embarrassing questions about the viability of the troubled French submarine project than about the long-term consequences in terms of cost and strategic effectiveness. Greg Sheridan is no China dove, quite the opposite in fact, but in the Australian late last year he wrote this:

For the government, the AUKUS subs are a magic pudding, so far away you don't have to spend any more money on them, and so impressive sounding they convince people you are doing something on defence when you are doing nothing. And if a few lefties complain, all the better, but it still produces no defence capability over the next 10 years and quite possibly nothing after that either.

Sheridan is not alone. Michael Shoebridge is the former director of ASPI's Defence, Strategy and National Security program. Last November he wrote this:

In a different world, where Defence was meeting its core obligations to provide cogent, well-founded advice to support government decision making, we would expect that there had been a proper analysis of alternative ways of increasing Australia's deterrent capabilities and long range strike against the backdrop of a dangerous region centred on an aggressive China.

But it is almost certain that this did not happen in the lead up to the AUKUS announcement.

No wonder doubts persist, not just about the financial wisdom but also the strategic wisdom to the AUKUS initiative.

Hugh White has never been a fan of the hawks who believe that Australia's security depends on the United States maintaining its strategic predominance in the western Pacific. Indeed, he has argued and continues to argue that AUKUS may fail to materialise, and even if it does, it may leave Australia more strategically vulnerable than less. He also has some cogent points to make about Pillar II, again, the subject of at least one part of this legislation. The minister, in his second reading speech, declared that the measures in the bill are expected to provide a net benefit to the Australian economy of $614 million over a 10-year period. In a recent article in Australian Foreign Affairs, White was far from convinced, declaring:

It is naive to expect that the easing of some legislative constraints on Australian participation in US defence procurement will send a flood of work our way… In the highly politicised world of defence contracting, our AUKUS partners will always bend over backwards to keep this work at home… Defence industry integration is more likely to mean that work on Australian projects will flow to America and to Britain than the other way around.

And White does have some bona fides in this area. He was high up in the defence department under both Labor and coalition governments, and one of the authors of the 2000 Defence white paper which first raised official concerns about China as a long-term security threat. In his recent essay, he also notes the historical fact that more expensive new tech does not necessarily win wars. More low-end equipment is arguably more effective.

Anyway, not for the first time, we are being asked in this House to vote on legislation drafted before a parliamentary inquiry—on this occasion by the Senate Foreign Affairs, Defence and Trade Legislation Committee—is complete. The committee offered several recommendations in line with concerns expressed both by Australian industry and the research community. The committee recommended that the definition of 'fundamental research' at the heart of the legislation be placed in the bill itself. Also, it was recommended that there be further consideration given to the exact definition of the term 'Australian persons', which would determine whether a researcher, for example, would be acceptable under the terms of the Defence Trade Controls Amendment Bill 2023. In particular, the committee recommended that the definition is consistent with defence trade controls in the US that provide for exemptions of foreign citizens of states subject to Washington's sanction, regardless of their American residency status. As former Chief Scientist Ian Chubb noted in evidence to the committee:

While the proposed new legislation does result in some lightening of the red tape regarding science conducted with colleagues in the US and the UK, potentially, it also raises the bar for the rest of the world, including long-term collaborators in Europe, Southeast Asia, Oceania and the Americas.

And that's at a time when Australia can't get all the STEM expertise we need from the AUKUS nations alone.

We run the risk of passing a piece of legislation that, while it looks beneficial on the surface, makes matters worse because it could exclude expertise from non-AUKUS sources while making us even more dependent on the US defence sector, which is notoriously inward looking and subject to the parochial demands of individual members of Congress. It's not necessarily a criticism of the Americans; it's simply reality.

I now understand that the government has been consulting with stakeholders in the research community about these provisions and plans to alter the legislation with the intention of addressing these issues. I look forward to seeing what the government proposes and whether any changes fully address concerns. I will otherwise move a series of amendments later to address these issues.

In recent days we've seen the Pentagon playing into concerns about whether AUKUS can ever deliver what Scott Morrison promised and that the current Prime Minister rushed to accept for fear of being wedged in the lead-up to the last election. This rare bipartisanship, ironically, is less than ideal in this case, I believe, because—as I alluded to at the start of this speech—it has meant that there's been very limited tolerance for debate and discussion about the finer points of this deal. As part of its game of fiscal chicken with Congress, the Pentagon has proposed a budget that would see just one nuclear submarine off the production line next year, compared with the figure of 2.3 that the US Navy says would be needed to ensure that enough subs are produced to meet Washington's AUKUS commitments as well as its own requirements.

The question is whether the US Navy had been blinded by reality, given that the official Congressional Research Service reported in December:

… the submarine construction industrial base is currently able to build them at a rate of about 1.2 to 1.3 boats per year, resulting in a growing backlog of SSN—

that is, nuclear submarine—

construction work.

The report goes on to say:

If the Navy is not able to achieve an SSN construction rate of 2.33 boats per year, then replacement boats … could enter service with the US Navy later than indicated … or perhaps not be built at all.

The question then becomes this: if that is the reality, what actual chance is there of Australia getting the subs that it's been pledged in the time frame promised, protracted as it is, or, indeed, ever? What does that mean for AUKUS Pillar II, which is at the centre of this legislation? Those questions exist without even considering the prospect of what would happen should Donald Trump return to the White House with a declared and inward-looking agenda of America first.

Stephen Bates (Brisbane, Australian Greens) Share this | Link to this | Hansard source

I rise to speak on the Defence Trade Controls Amendment Bill 2023. This bill is part of a suite of AUKUS related legislation that aims to ensure that Australia's military export system is aligned with the US. It will cut Australia off from the rest of the world and tie us to the US; this is a precondition for Australia to receive nuclear submarines. This bill will effectively create a licence-free export bubble between Australia, the US and the UK, concerning military and dual-use goods. However, this bill also means that Australia will, effectively, be cut off from the rest of the world—as I said. It will mean harsher and wider restrictions in working with people outside of the Anglo bubble.

If this bill passes in its current state, researchers and businesses working with people from countries like South Korea or India on technology and research that is dual use would have to stop and get approval from the minister or risk 10 years imprisonment. This has drawn widespread criticism from industry and the higher education sector, who have raised real concerns that this new bill will force them to apply for thousands of new permits to do basic research and product development. This bill risks creating a significant disincentive for most of the world to work with Australian researchers and to trade critical technology, and it is not something that the Greens will support.

Richard Marles (Corio, Australian Labor Party, Minister for Defence) Share this | Link to this | Hansard source

I thank all members who have contributed to the debate on these important bills. I'd also like to thank the opposition for their bipartisanship and support in progressing these bills through the parliament. There's been constructive engagement across the aisle and with defence officials to support a considered outcome for Australia's protective security framework. The Defence Trade Controls Amendment Bill 2023 and the Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 represent critical reforms to Australia's protective security framework. In the complex and challenging strategic environment that we face today, preventing our defence technologies, capabilities and information from falling into the hands of our adversaries is paramount.

At the same time, these reforms represent a significant opportunity to unlock the benefits of AUKUS, helping establish a seamless industrial base between Australia, the United States and the United Kingdom. These reforms will achieve this by establishing a new licence for the environment among AUKUS partners through a national exemption for the US and UK from Australia's export control licensing requirements under the Defence Trade Controls Act. This will revolutionise collaboration and defence trade, unlocking investment and growth opportunities for Australian industry, research and science. These reforms are expected to provide an estimated net benefit to the economy of $614 million over the next 10 years. The reduction in regulation through the national exemption for export permits to the US and the UK would benefit 5 billion of the almost $9 billion in annual defence exports. These exemptions would also mean that almost a third of the 3,000 export permit applications currently assessed annually are no longer required.

Australia's export control regime is a permissive system designed to permit the responsible transfer of controlled goods and technology. These reforms do not change this underlying principle. Similarly, the safeguarding Australia's military secrets bill does not seek to limit the employment opportunities of any Australians. It extends Australia's already robust legislation and policies further by enhancing the protections around our defence information and technology and that of our allies. It adopts a proactive approach by establishing an authorisation framework to regulate the performance of work and specified training to a foreign military, foreign government or foreign government entity.

The reforms in these bills strike the balance between protecting our national security while supporting our economic innovation and international research collaboration. These bills will ensure the United Kingdon and the United States can collaborate, innovate and trade at the speed and scale required to meet the challenging strategic circumstances, and they will build Australia's long-term national defence by supporting our AUKUS commitment.

These bills were the subject of inquiry processes by the Senate Standing Committee on Foreign Affairs, Defence and Trade and the Parliamentary Joint Committee on Intelligence and Security. The government thanks the committees for their work. As I said in my second reading speech, the government is committed to improving the bills through an inquiry process. The assistant minister has outlined in his contribution the government's response to these reports, and the amendments that I will read shortly achieve this aim. I commend the bills to the house.

Question agreed to.

Bill read a second time.