2. Consideration of the Bill and Committee comment
   1. The Committee did not receive many submissions on this Bill. This chapter sets out the issues submitters brought to the attention of the Committee and the Committee’s comments on the Bill.

Need for the Bill

2.2The Department of Defence set out the need for the Bill as follows:

In 2022, concerning reports emerged of international flight training schools attempting to recruit serving and former military pilots from western countries to provide training in China. The United Kingdom’s Ministry of Defence subsequently released a statement in October 2022 advising of their intention to take immediate steps to deter and penalise former UK military pilots providing training to foreign militaries as it erodes the United Kingdom’s defence advantage.[1]

2.3Defence provided the Committee with a number of case studies and further stated that the Bill

is an important step towards ensuring foreign actors cannot collect Defence secrets through the employment of former Defence personnel, or Australians with knowledge of and access to sensitive technology and military information.[2]

2.4At the public hearing Defence explained that the Bill complemented the Defence Trade Controls Amendment Bill to

further strengthen Australia's export control framework by enhancing the protections around the supply of controlled goods and technology within and outside of 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 of the US Arms Export Control Act.[3]

2.5The Australian Security Intelligence Organisation (ASIO) gave the Committee its assessment of the threats to the Australian community in the area of Defence secrets, stating that:

Hostile foreign states and their intelligence services are aggressively seeking secrets about Australia's defence capabilities, government decision-making, political parties, foreign policy, critical infrastructure, space technologies, academic and think tank research, medical advances, key export industries and personal information.[4]

2.6ASIO noted the intent of the Bill as being

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.[5]

2.7Importantly ASIO stressed that the Bill does not represent the entirety of its ‘legislative ambition for enhancing Australia's security standards to safeguard sensitive technology and information’ and stated that:

Although Australia has a range of legislative measures and policies in place to deter, detect and respond to the risk of foreign interference and espionage, more can be done to ensure that legislative measures protecting Australia 's secrets, sensitive information and technologies keeps pace with the complex, challenging and changing threat environment.[6]

2.8Some submitters explicitly stated their support for the policy intent of the Bill. For example, the Australian Manufacturing Workers Union (AMWU) stated that it supported

the intention to deny foreign countries access to expertise which, if exploited, would be inimical to Australia's security interests.[7]

2.9Similarly, Andrew Donnellan stated that:

The overall intention of this bill - preventing foreign powers whose interests are not aligned with ours from benefiting from Australian military expertise - is entirely sensible.[8]

Concerns with the Bill

2.10As set out above most submitters were supportive of the need for and intent of the Bill. However, concerns were raised by some about its provisions as drafted.

2.11Dr Brendan Walker-Munro, Senior Research Fellow of the T.C. Beirne School of Law at the University of Queensland, while stating that ‘the intention of government to secure our military information is not only to be welcomed but strongly endorsed’,[9] stated that the Bill should not be passed in its ‘present form’ as it contains

sweeping, vague and incredibly punitive provisions with no logical, rational or observable connection to “military secrets”, which is the supposed policy harm which it is intended to remedy. The proposed amendments also unnecessarily expose former ADF members and APS staff to significant potential criminal penalties for merely exercising their rights to seek employment for an entity which resides outside Australia. In doing so, SAMS unfairly elevates the Minister to acting as the arbiter of the circumstances in which, and conditions which will apply to, former ADF member or APS staff seeking employment for government and military agencies outside Australia.[10]

2.12The AWWU explained that it was not unusual for its members working in the private sector to have previously been civilian employees within the Department of Defence and, as a result of this, many of these members would be affected by the Bill.[11] The AMWU’s view was that the Bill needed to focus on the ‘small minority’ of individuals who might act against Australia’s national security interests and whose current expertise or knowledge posed a genuine threat to those interests.[12]

2.13The AMWU noted the Minister’s proposed power under section 115 to determine, via legislative instrument, that certain individuals or classes of individuals are not ‘foreign work restricted individuals’, effectively exempting them from the scheme. The AMWU submitted that:

In the case of each "foreign work restricted individual" as defined in the Bill, these exemptions should be exercised having regard to such matters as:

• the time that has passed since the individual concerned was a "defence staff member" (as defined);
• the sensitivity of the knowledge/expertise (ever) held by that individual whilst in the Department or ADF;
• whether or not the country in or for which the individual seeks to work is an ally of Australia; and
• (in the case of a corporate entity or the like) whether or not the potential employer of the individual is one which the Commonwealth itself has engaged to perform work for or to provide services to Australia, such as to have established its security credentials, notwithstanding that a foreign government may control that employer in whole or in significant part.

The AMWU acknowledges that these matters are apparently already in contemplation.[13]

2.14Boeing Australia set out its concerns relating to unintended consequences of the Bill with a specific focus on the interaction between authorisations from the Defence Export Control organisation (DEC, within the Department of Defence) and the operation of the Bill, and definitions of ‘work’ and ‘training’.

2.15Boeing explained that where an authorisation from the DEC has been provided to undertake proposed work in a certain country and that country has not been exempted by the Bill it would create a situation whereby all individuals involved in that work which could run to hundreds of people would ‘need to submit (and possibly re-submit) an application for authorisation under the Bill.’ Boeing stated that

Considering the increasing threat environment and potential for conflict – this will clearly increase the overall administrative burden and slow support from industry, thus potentially impacting coalition operations who rely on this critical support. Especially if networks or systems are compromised preventing quick authorisations in extremis.[14]

2.16Boeing outlined its concerns with the definitions of ‘work’ and ‘training’ as being particularly open as they relate to ‘regional collaboration amongst the defence science community’. Boeing identified that there was a risk that

as a result of Australia’s close research ties with Quad and Five Eyes countries, that discussions may occur between Boeing personnel and Defence science organisations that fall within the scope of a ‘government body of a foreign country’ – requiring specific exemptions be put in place, adding to the administrative burden.[15]

2.17Boeing suggested the Committee consider the following recommendations:

• if an approved Australian export permit or licence is issued, then work associated with that product or licence is exempt from the legislation
• an exclusion process that permits the Minister (or their approved delegate) to grant an authorisation to all employees of that business.[16]
  18. The Australian Industry Group (AiGroup) also suggested the same amendments. Additionally, AiGroup recommended that the Act should apply

exclusively to specified roles and ranks within the Australian Defence Force (ADF), such as ADF members holding the rank of LTCOL and above. Additionally, include specific specialisations like Pilot, Electronic Warfare, Cyber, and Intelligence. This targeted approach ensures a focused application of the Act, concentrating on higher-ranking officials and specialised roles crucial to national security.[17]

2.19At the public hearing Defence officials pointed out that ‘in terms of skills, some of the lower ranked technical members of the Australian Defence Force’ were the people it was most concerned about. Defence agreed with the proposition that, if exemptions were distilled into rank, roles or specialisations that people would ‘fall through the cracks’.[18]

2.20The Australian Technology Network of Universities (ATN) recommended that

due consideration be given to how this Bill would apply to university teaching and research staff, any possible unintended consequences, and whether the Bill could be amended to streamline authorisations or exemptions given existing regulations.[19]

2.21Macquarie University noted that terms such as ‘training’ and ‘military related’ were undefined and, as such, the teaching of dual use research disciplines and critical technologies could be captured by the term ‘military related training’. It was therefore concerned that the scope of proposed section 115B(1) may mean that the authorisation regime would apply to ‘educational services of an academic nature provided by academics operating at an international level even where the academics may have no knowledge of sensitive Defence information.’[20]

2.22Macquarie University recommended that proposed section 115B(1) be amended so that it only applies to ‘training concerning the military tactics, military operations and military procedures of the Australian Defence Force.’[21]

2.23Dr Brendan Walker-Munro set out a number of concerns as follows:

• overlap between the proposed section 115A offence and existing foreign interference and espionage offences
• lack of connection between the offences and “military secrets”
• duplication of existing official secrets prohibitions
• overlap of section 115B offence with export control laws
• unintended consequences of prohibiting training “relating to military tactics, military techniques or military procedures”
• lack of safeguards for commencement of prosecution
• creation of a serious offence with mixed standards of criminal responsibility
• application to all ex-Defence personnel
• lack of application to military contractors
• size of applicable penalties.[22]
  24. Andrew Donellan set out a number of concerns as follows:
• excessive scope
• excessive punishment
• excessive reliance on ministerial determinations
• affected employees may not know they’re affected
• impact on staffing if the provisions dissuade people from joining the Department of Defence or other public service and intelligence agencies
• potentially disproportionate impact on staff from migrant backgrounds.[23]

Humanitarian exception in the Bill

2.25As outlined in Chapter 1, proposed subsection 115A(6) provides an exception to the offence of foreign work restricted individuals working for a foreign military organisation or government body if the work performed by the individual is solely or primarily for either or both of the following purposes:

• providing aid of a humanitarian nature;
• performing an official duty for, the United Nations or an agency of the United Nations or the International Committee of the Red Cross.
  26. The Explanatory Memorandum states that:

It is recognised that many of the skills developed while engaged with the ADF or Defence could be directly or indirectly applicable to humanitarian aid. It is not intended to prevent a foreign work restricted individual from providing humanitarian aid in either a voluntary or an official capacity, provided that entry or access to the relevant location was not prohibited by Australian law.[24]

2.27Where a defendant seeks to rely on this exception, the defendant bears the evidential burden of proving that the work performed by the individual is solely or primarily for providing aid of a humanitarian nature or performing an official duty for the United Nations, an agency of the United Nations, or the International Committee of the Red Cross.[25]

2.28The Australian Red Cross, the International Committee of the Red Cross and the International Federation of Red Cross and Red Crescent Societies suggested that the following amendments would strengthen the exception provided for humanitarian activities in the Bill:

Our view is that these humanitarian exceptions could be explicitly strengthened by:

• Amending sub-sections 115A(6)(a) and 115B(6)(a) of the Bill to clarify that the conduct of all humanitarian activities is excluded from the Proposed Offences.
• Amending sub-sections 115A(6)(b)(ii) and 115B(6)(b)(ii) of the Bill to clarify that performing an official duty for “a component of the International Red Cross and Red Crescent Movement” is excluded from the operation of the Proposed Offences.[26]

Implementation of the authorisation regime

2.29In its submission the Department of Defence set out its plans for the implementation of the authorisation regime:

Following the Committee’s review of the Bill, further consultations will be undertaken by Defence to ensure implementation of the authorisation framework is well understood, and to provide opportunities for questions and concerns to be raised and addressed. As noted above, Defence will work with stakeholders to develop a range of detailed scenarios to help clarify how the authorisation framework will apply in various circumstances.

Defence will also continue to work with stakeholder groups to raise awareness of the new work authorisation framework, not only in Australia, but also among Australian citizens and permanent residents working overseas.

Defence is planning a broad national and international communications campaign to support the commencement of the legislation.

Defence is very conscious that it will be important to efficiently process work authorisation requests. Detailed planning activities have commenced to ensure this objective is met.[27]

2.30Additionally, in the public hearing, Defence stated that it had

engaged some communication contractors to help us with the international communications campaign. We have, I think, a good domestic communications capability, but our international communications capability is not something we exercise a lot, so we have engaged some professional expertise to help us and ensure that that is a comprehensive campaign.

I just note that we are also, in reaching out to ex-ADF people who may be overseas, leaning very heavily on veterans associations and channels—formally through DVA and also informally through associations we're aware of through the ADF. We are very aware of the need to disseminate this message to veterans overseas who may not have been engaged with Australia for some time.[28]

Committee comment

2.31The Committee shares and acknowledges the concerns of the Government that former military personnel can be and are being targeted for recruitment by foreign governments. The Committee also notes 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.

2.32The Bill intends to set up a straightforward application and authorisation scheme. Before commenting further, the Committee particularly recognises that, as stated by ASIO, this Bill does not represent the entirety of legislation envisaged for enhancing Australia's security standards to safeguard sensitive technology and information.

2.33The Bill is seeking to enhance and extend the existing prohibition in legislation and procedures on sharing military secrets.

2.34The Committee is not persuaded that proposed section 115B(1) should be amended so that it only applies to ‘training concerning the military tactics, military operations and military procedures of the Australian Defence Force’, as recommended by Macquarie University. It is important that the regime be legislated and implemented in such a way as to cover all the possible iterations of information that could be imparted to an ADF member and subsequently be at risk of being disclosed to an employer.

2.35In relation to the concerns raised by Dr Walker-Munro that there is overlap between the proposed new offences and existing foreign interference, espionage and official secrets prohibitions, the Committee notes that this Bill establishes an authorisation framework requiring former Defence personnel to obtain authorisation before performing work for, or on behalf of, foreign military organisations or government entities. The Committee recognises that the establishment of such a framework requires that offences separate to other, broader secrecy offences be established.

2.36In addition, the Committee notes the further concerns raised by Mr Walker-Munro and Mr Andrew Donellan but, in the context of a scheme that must stand alone and deal with a number of nuanced and complex issues it is not persuaded that these concerns need to be further addressed by Government.

2.37The Committee acknowledges the concerns of the Australian Red Cross, the International Committee of the Red Cross and the International Federation of Red Cross and Red Crescent Societies that the exception provided for humanitarian activities needs to be strengthened.

2.38The Committee is satisfied that, as currently drafted, paragraphs 115A(6)(a) and 115B(6)(a) of the Bill which use the term ‘providing aid of a humanitarian nature’, are broad enough to ensure that humanitarian activities are appropriately provided for in the Bill. It is entirely appropriate that the work performed by the individual needs to be solely or primarily for providing aid of a humanitarian nature and not a mere, smaller, part of some other work commitment.

2.39In its review the Committee noted a possible loophole in the Bill, being that if an Australian citizen with relevant military or Defence and Strategic Goods List knowledge provided training to a military organisation of a foreign country or a government body of a foreign country they are captured by the Bill, however a person with identical relevant knowledge who had joined a militia or paramilitary group that was not affiliated with the government of a foreign country would not be captured by the offences in the Bill.

2.40Defence suggested that this would be covered by other offences in the Criminal Code.[29]

2.41The Committee notes the scope of the offence created by section 115B. This section would make it an offence for an Australian citizen or resident to provide training where ‘the training relates to military tactics, military techniques or military procedures’, noting that training for the purposes of this legislation can be regular or irregular, formal or informal, and for reward or not.

2.42In this regard the Committee notes the Minister’s second reading speech in which he referred to the Bill’s purpose in the following terms:

to safeguard sensitive technology and information

and

preventing former defence personnel from transferring sensitive defence information to foreign militaries with interests inimical to Australia's interests.[30]

2.43The Committee therefore shares the concerns of submitters that section 115B as drafted is too vague and broad and isn’t sufficiently focused on protecting ‘military secrets’.

2.44The Committee also acknowledges the concerns of AIG and Boeing around some administrative duplication potentially created by the Bill. That is, where an authorisation for work in a country not exempted by the Bill has been provided by the Defence Export Control organisation, an additional requirement for every individual involved in that work to obtain authorisation under the Bill increases the overall administrative burden, and could have unintended consequences impacting Australia’s defence, national security or foreign relations.

2.45Noting the above discussion there are a number of amendments the Committee suggests the Government consider before seeking passage of the Bill. For the avoidance of doubt the Committee does not consider that these amendments meet the threshold that, if not implemented, the Committee would recommend the Bill not pass.

2.46The Committee recommends that the Government consider amending the Defence Amendment (Safeguarding Australia’s Military Secrets) Bill 2023 so that paragraphs 115A(6)(b)(ii) and 115B(6)(b)(ii) refer to ‘a component of the International Red Cross and Red Crescent Movement’, rather than only ‘the International Committee of the Red Cross’; to exclude individuals performing official duties for all relevant agencies within the International Red Cross and Red Crescent Movement from the operation of the proposed offences; and

2.47The Committee recommends that the Government assess the existing legislation and procedures and whether they sufficiently cover working or training for paramilitary organisations and militias by former defence personnel.

2.48The Committee recommends that the Government amend the language in paragraph 115B(1)(d)(ii) to make it less broad and more purposeful, such as by adding words so that an offence is created in relation to circumstances where the training relates to military tactics, military techniques or military procedures ‘that would prejudice the security, defence or international relations of Australia’.

2.49The Committee recommends that the Government consider amending the Bill to provide the Minister for Defence with the ability to determine by legislative instrument classes or categories of non-former Defence members that are not required to apply for an authorisation – for example, in cases where a company has been approved to provide goods under the Defence Export Control (DEC) arrangements, and any training, education, or information provision that will occur is confined to personnel involved in, and limited to the purpose of supporting the acquisition and use of the relevant product within the scope of that approval.This could allow a company to apply for a ‘bulk’ approval in the relevant circumstances, and align that application with the DEC process to avoid delays and uncertainty.

2.50The Committee recommends that the Australian Government assess how existing legislation and procedures covering former National Intelligence Community officers and their work for foreign governments should be strengthened, and address the need for further legislation.

2.51The Committee notes recommendation six from the Joint Standing Committee on Foreign Affairs, Defence and Trade’s report, Inquiry into international armed conflict decision making which recommended that

the Government introduce legislation to establish a Joint Statutory Committee on Defence to supersede and enhance the Defence related functions currently undertaken by the Joint Standing Committee of Foreign Affairs, Defence and Trade. This committee should have its powers set out in legislation, including oversight and accountability functions in relation to the Australian Defence Force, the Department of Defence . . .[31]

2.52The Government Response to this recommendation stated that the Government agreed with the recommendation and that it would

conduct further work in a timely manner to determine the scope of the proposed committee and its appropriate powers and functions.[32]

2.53In the event the proposed new Joint Statutory Committee on Defence is established by the time any further legislative amendments relating to the military secrets regime are introduced to the Parliament; the PJCIS considers that these should be sent to that committee for scrutiny.

2.54The Committee recommends that the Defence Amendment (Safeguarding Australia’s Military Secrets) Bill be passed.

Mr Peter KhalilMP

Chair

February 2024

Footnotes

[1]Department of Defence, Submission 10, p. 2.

[2]Department of Defence, Submission 10, p. 2.

[3]Ms Celia Perkins, Deputy Secretary, Security and Estate, Department of Defence, Committee Hansard, Canberra, 22 February 2024, p. 9.

[4]ASIO, Submission 4, p. 2.

[5]ASIO, Submission 4, p. 2.

[6]ASIO, Submission 4, p. 2.

[7]AMWU, Submission 1, p. 4.

[8]Andrew Donellan, Submission 7, p. 1.

[9]Dr Brendan Walker-Munro, Submission 2, p. 11.

[10]Dr Brendan Walker-Munro, Submission 2, p. 2.

[11]AMWU. Submission 1, pp. 3 - 4.

[12]AMWU, Submission 1, p. 5.

[13]AMWU. Submission 1, p. 5.

[14]Boeing Australia, Submission 9, p. 4.

[15]Boeing Australia, Submission 9, p. 4.

[16]Boeing Australia, Submission 9, p. 5.

[17]The Australian Industry Group, Submission 5, p. 4.

[18]Mr Peter West, First Assistant Secretary, Defence Security, Department of Defence, Committee Hansard, Canberra, 22 February 2024, p. 16.

[19]Australian Technology Network of Universities (ATN), Submission 6, p. 2.

[20]Macquarie University, Submission 3, p. 1.

[21]Macquarie University, Submission 3, p. 1.

[22]Dr Brendan Walker-Munro, Submission 2.

[23]Mr Andrew Donnellan, Submission 7.

[24]EM, Schedule 1, [86].

[25]EM, Schedule 1, [88].

[26]Australian Red Cross, the International Committee of the Red Cross and the International Federation of Red Cross and Red Crescent Societies, Submission 8, p. 2.

[27]Department of Defence, Submission 10, p. 7.

[28]Mr Peter West, First Assistant Secretary, Defence Security, Department of Defence, Committee Hansard, Canberra, 22 February 2024, p. 12.

[29]Ms Celia Perkins, Deputy Secretary, Security and Estate, Department of Defence, Committee Hansard, Canberra, 22 February 2024, p. 13.

[30]The Hon Richard Marles MP, Deputy Prime Minister and Minister for Defence, Parliament of Australia, House of Representatives, Hansard, 14 September 2023, p. 7127.

[31]Parliament of Australia, Joint Standing Committee on Foreign Affairs, Defence and Trade, Inquiry into international armed conflict decision making, p. 58, tabled 31 March 2023.

[32]Australian Government, Australian Government response to the Joint Standing Committee on Foreign Affairs, Defence and Trade, Inquiry into international armed conflict decision making, p. 9, tabled 8 August 2023.