Referral
1.1
On 12 February 2019, the Ministers of State (Checks for Security Purposes) Bill 2019 (the bill) was introduced to the Senate by Senator Rex Patrick. The bill lapsed at the end of the 45th Parliament and was restored to the Notice Paper on 4 July 2019.
1.2
On 4 July 2019, pursuant to the Senate Selection of Bills Report, the bill was referred to the Senate Finance and Public Administration Legislation Committee (committee) for inquiry and report by 11 November 2019.
Purpose of the bill
1.3
This private member's bill seeks 'to ensure that the Prime Minister is fully informed of any security issues that may arise from the personal background and circumstances of persons who have been appointed as Ministers of State including Assistant Ministers and Parliamentary Secretaries'.
1.4
The bill would achieve this by introducing 'an obligation for the Prime Minister to direct the Director‑General of Security to provide a report on any security matters arising from examination of the personal background and circumstances of Ministers of State'. The report produced by the Director‑General of Security (Director‑General) would not be an official security assessment, pursuant to Part IV of the Australian Security Intelligence Organisation (ASIO) Act 1979 (ASIO Act).
1.5
The Explanatory Memorandum (EM) states that the implementation of this scheme 'would address a significant gap in Australia’s Protective Security Framework', and in doing so support recent legislative changes 'relating to espionage and foreign interference in Australia'. Further, the implementation of the scheme would also 'provide the Parliament and the Australian public greater assurance that security will be maintained at the highest levels of the Australian Government'.
Conduct of the inquiry
1.6
Details of the inquiry, including links to the bill and associated documents were placed on the committee website at: www.aph.gov.au/senate_fpa.
1.7
The committee directly contacted a number of relevant organisations and individuals to notify them of the inquiry and invite submissions by 23 August 2019. The committee received one submission, which is listed at Appendix 1. The committee also put a number of written questions on notice to relevant departments.
Provisions of the bill
1.8
The bill would make no amendments to existing legislation. Rather, it would become a stand-alone Act imposing new obligations on the Prime Minister and the Director‑General.
1.9
Clause 5 of Part 2 of the bill sets out the proposed reporting framework. This framework includes that, no later than 14 days after the appointment of a Minister of State, the Prime Minister must direct the Director-General in writing to report on 'matters relating to security arising from examination of the personal background and circumstances of the Minister of State'. This same requirement applies no later than 14 days after the commencement of the Act to 'all current Ministers of State'. The Prime Minister is excluded from being a subject of a report by the Director‑General.
1.10
The reporting requirements also proscribe that the information obtained and inquiries that the Director-General would undertake must be equivalent to those undertaken with respect to employees of the Australian Security Intelligence Organisation (ASIO). An authorised ASIO employee may obtain information and undertake inquiries with the authorisation of the Director‑General.
1.11
A Minister of State would be required to provide the Director-General or authorised ASIO employee with the information requested. Any Ministers that provide false or misleading evidence may be subject to the offence provisions of the Criminal Code Act 1995.
1.12
The Director-General would then be required to provide the Prime Minister with written reports relating to the security checks for Ministers of State within 120 days of the Prime Minister's direction to the Director-General. The Prime Minister would be empowered to request the Director-General provide further information about a Minister in an additional report.
1.13
The bill would also impose certain obligations pertaining to safeguarding the reports on the Prime Minister and Director‑General.
Background to the bill
Appointment of Ministers of State
1.14
Section 64 of the Australian Constitution provides that Ministers of State are appointed by the Governor-General to administer federal government departments:
The Governor-General may appoint officers to administer such departments of State of the Commonwealth as the Governor-General in Council may establish.
Such officers shall hold office during the pleasure of the Governor-General. They shall be members of the Federal Executive Council, and shall be the Queen's Ministers of State for the Commonwealth.
1.15
The Governor-General appoints Ministers on the advice of the Prime Minister.
1.16
At present, the Governor-General cannot appoint more than 12 Ministers of State as Parliamentary Secretaries. There should be no more than 30 Ministers of State in addition to those who are appointed as Parliamentary Secretaries.
Security clearances
1.17
The EM provides that the security clearance processes that apply to employees and contractors who access 'sensitive or national security classified Australian Government information' are 'an essential foundation' for Australia's protective security arrangements, 'including the investigation of foreign espionage and interference activities'.
1.18
The Protective Security Policy Framework (PSPF) sets out the government's protective security policy, including in respect of employees of and contractors to Australian Government entities.
1.19
In order to achieve the personnel security outcome set out in the PSPF, each entity must implement 'the three personnel security core requirements to ensure employees and contractors are suitable to access Australian Government resources throughout all stages of their engagement with the entity'.
1.20
One of these requirements is to conduct relevant checks of an employee or contractor before this person gains access to Australian Government resources:
Each entity must ensure the eligibility and suitability of its personnel who have access to Australian Government resources (people, information and assets).
Entities must use the Australian Government Security Vetting Agency (AGSVA) to conduct vetting, or where authorised conduct security vetting, in a manner consistent with the Personnel Security Vetting Standards.
1.21
The minimum checks for Baseline Vetting include:
verification of identity by using the Document Verification Service for Australian issued primary identification documents;
confirmation of Australian citizenship and status of any other citizenships;
background check covering the previous 5 years;
official secrets declaration;
national police check; and
1.22
Higher security levels require additional, or more extensive checking, for example background checking to 10 years (Negative Vetting 1 and 2) and psychological assessment (Positive Vetting).
1.23
Rather than using AGSVA, ASIO 'undertakes security clearance checking for its own personnel and those of other intelligence agencies'.
1.24
A number of Australian office holders are exempt from undergoing the security clearance process, despite the fact that these individuals may have the ability to access 'sensitive or national security classified Australian Government information'. Exempt office holders include Members and Senators of the Commonwealth, state parliaments and territory legislative assemblies.
1.25
The EM states that the PSPF advances 'no reasons to support the policy to exempt certain office holders from security clearance requirements'. Further, the EM sets out that of the exempt classes of office holders, Ministers of State have access to 'the most extensive and ongoing access to sensitive and security classified information'. However, it is noted that, '[a]side from Ministers of State, most Members of Parliament do not have ongoing access to sensitive and/or national security classified government information'.
The Canadian model
1.26
The EM refers to recent advancements in Canada that strengthen Canada's security framework.
1.27
In 2015, the then Canadian Prime Minister, the Right Hon. Stephen Harper introduced a system of security background checks for Federal Ministers 'in a context of concerns about foreign espionage and interference in Canada'. These security checks 'are informal and ultimately at the discretion of the Prime Minister'.
1.28
The EM suggests that the continuance of this system under the current Canadian Prime Minister, the Right Hon. Justin Trudeau, is a testament to the success of the system.
1.29
The bill adapts the model of the Canadian system.
Consideration of the bill by Legislative Scrutiny Committees
1.30
The Senate Standing Committee for the Scrutiny of Bills considered the bill in its second report of 2019, but made no comment.
1.31
The Parliamentary Joint Committee on Human Rights (PJCHR) considered the bill in its fourth report of 2019. The PJCHR noted that the bill appears 'to engage and may limit human rights', and that it may request further information from the legislation proponent 'should the bill proceed to further stages of debate'.
Key issues
1.32
The key issues raised in the inquiry are addressed below in three broad categories:
the current mechanisms for Ministerial accountability;
the procedures and processes currently in place for the provision of and handling by Ministers offices' of classified and sensitive information; and
specific issues in relation to the drafting of the bill.
Accountability mechanisms
1.33
In a submission on behalf of the Home Affairs portfolio, the Department of Home Affairs (Home Affairs) outlined the current mechanisms for Ministerial accountability, specifically:
the principle of responsible and representative government;
the Statement of Ministerial Standards; and
existing functions of the Director-General.
Responsible and representative government
1.34
Home Affairs referred to the principle of responsible and representative government, pursuant to which:
Ministers are accountable to the Parliament, the members of which are in turn accountable to the people of Australia by way of elections.
1.35
Home Affairs expanded on this point noting that as Ministers must be drawn from members of Parliament, Ministers must hold the confidence of the people to continue to hold office. Further, section 46 of the Australian Constitution (set out earlier at paragraph 1.14), in providing that no Minister of State shall hold office for longer than three months unless they become a Senator or Member of the House of Representatives 'ensures Minster of State are subject to public, political and media scrutiny through the election process'.
1.36
No confidence and censure motions are also means by which Ministers may be held accountable to Parliament:
A motion of no-confidence is an important democratic tool, which allows members of the Parliament to make a statement or vote about whether a member of Parliament is no longer deemed fit to hold that position, perhaps because they are inadequate in some respect, are failing to carry out obligations, or are making decisions that other members feel detrimental.
Further, the ability for the Senate and the House of Representatives to pass censure motions provides an important mechanism for Parliament to express disapproval of ministers and their actions…
If there is dissatisfaction with the performance of a particular minister, a censure motion may be moved. Although a resolution of the Senate censuring the government or a minister can have no direct constitutional or legal consequences, it does act as an expression of the Senate's disapproval.
1.37
Home Affairs stated:
Australia’s system of responsible and representative government provides important mechanisms to ensure Ministers of State are appropriate to hold that position and to ensure that Ministers enjoy the confidence of the Australian people. Introducing an additional mandatory legislative requirement as proposed in the Bill would achieve no more than what is already provided for through Australia’s system of government and laws.
Statement of Ministerial Standards
1.38
The Statement of Ministerial Standards is the Prime Minister's code of conduct by which Ministers are expected to comply. As Home Affairs explained:
This Statement details the ethical standards required of Ministers to ensure they act with integrity and in the best interests of the people of Australia. The Statement provides that Ministers may be required by the Prime Minister to resign if the Prime Minister is satisfied that they have failed to comply with the standards in a substantive and material way. Further, the Statement provides that, where an allegation of significant improper conduct (including a breach of the standards) is made against a Minister, the Prime Minister may refer the matter to an appropriate independent authority for investigation and advice.
1.39
Home Affairs argued:
Concerns in relation to the implications of a Minister’s personal background and circumstances is a matter that may be more appropriately dealt with in this Statement than in legislation of the kind proposed, however this is a matter for the Prime Minister.
Existing functions of the Director-General of Security
1.40
The ASIO Act provides that ASIO's functions are, among other things:
(a)
to obtain, correlate and evaluate intelligence relevant to security;
(b)
for purposes relevant to security, to communicate any such intelligence to such persons, and in such manner, as are appropriate to those purposes;
(c)
to advise Ministers and authorities of the Commonwealth in respect of matters relating to security, in so far as those matters are relevant to their functions and responsibilities.
1.41
Home Affairs indicated that, under these provisions of the ASIO Act, it is already within the functions and powers of ASIO to provide advice to a Prime Minister 'in respect of matters relating to security, of the kind envisaged by the Bill, in so far as it is relevant to the Prime Minister’s functions and responsibilities'. Such advice could be provided at the request of a Prime Minister or might be provided to the Prime Minister on the initiative of ASIO.
Current handling of security information
1.42
A number of departments provided the committee with answers to questions on notice about the levels of security clearances for employees and contractors; the provision of classified information to Ministers' offices and the handling of that material within Ministers' offices.
1.43
Home Affairs provided a summary of the number of personnel within that department cleared at each security clearance level:
Table 1.1: Number of Department of Home Affairs' personnel cleared at each Security Clearance Level
|
|
|
|
Baseline
|
12775
|
|
Negative Vetting 1
|
4519
|
|
Negative Vetting 2
|
1767
|
|
Positive Vetting
|
275
|
Source: Department of Home Affairs, answers to questions on notice, question 1, 30 September 2019 (received 4 November 2019). Data is at 4 October 2019 and includes ongoing and non-ongoing staff, consultants, secondees and contractors.
1.44
The Department of Defence (Defence) stated:
Staff across Defence hold clearances at a level commensurate with the requirements of their position. Defence staff regularly change positions and therefore the clearance levels across the Department vary. As at 30 June 2019, the actual strength of the ADF was 58,554 members, and the APS actual full-time equivalent workforce was 15,996, all of whom are required to hold a security clearance. ADF personnel are required to hold a minimum of a Negative Vetting Level 1 security clearance. APS are required to hold a minimum Baseline security clearance.
1.45
The Attorney-General's Department (Attorney-General's) informed the committee that the number of officers who hold security clearances at each level is sensitive information and is not suitable for publication.
1.46
In respect of the risks associated with personnel who are not security cleared in accessing classified data, Defence stated that '[a]ccess by uncleared personnel to Defence information could have serious to grave implications that would compromise Defence capability'. Defence also informed the committee about the processes in place to guard against this, noting that the PSPF:
…provides guidance on assessing risk through the use of the Business Impact Levels (BILs). The Department of Defence (Defence) uses this approach to assess the value, importance or sensitivity of official information by considering the potential damage to the national interest, organisations or individuals that would arise if the information's confidentiality was compromised.
1.47
In respect of whether there are any conditions placed on Ministers of State receiving, handling and disclosing foreign classified material, Defence informed the committee that:
The Australian Government has information sharing instruments in place with a number of countries which outline the reciprocal protection and handling requirements for the exchange of classified information. These include Whole of Government General Security Agreements (treaty-level), and Security of Information Agreements and Arrangements (SIA) (treaty or less-than-treaty level).
The Department of Defence has several SIAs covering the exchange and protection of Defence information, or information of Defence interest.
Defence complies with these international arrangements regarding classified material received from foreign agencies.
1.48
The committee was advised that 'Defence provides security awareness briefings for Ministers or their respective offices', which 'run for approximately one hour, or longer if needed'. Home Affairs stated that it provides 'security awareness briefings as required' with the timing and frequency of such briefings depending on the experience of those receiving the training. Attorney-General's confirmed that it provides ongoing support to the Minister and their staff on receiving, handling and safe custody of classified material as required, however details about training and briefing is sensitive and not suitable for publication.
1.49
Defence also informed the committee that it 'would not provide classified information to persons who do not hold the necessary security clearance', such as members of a Minister's staff. On the same question, Home Affairs advised:
Under the Department of Finance guidelines, Ministerial staff members are required to obtain and maintain a security clearance and Negative level 2.
The Department [of Home Affairs] only provides sensitive or classified information to those who have appropriate security clearances and a need to know that information.
1.50
Any security breaches made by ministerial staff must be reported to the Defence and Security Vetting Service pursuant to the Members of Parliament (Staff) Act 1984 and the Statement of Standards for Ministerial Staff. Both Attorney-General's and Home Affairs were not aware of any security breaches by ministerial staff.
1.51
Security breaches by Ministers are dealt with pursuant to the Statement of Ministerial Standards. Defence has advised that it 'provides advice to Ministers about responding to security breaches'. Both Attorney-General's and Home Affairs advised that they were unaware of any security breaches by the relevant Ministers.
1.52
Home Affairs was also asked to reconcile a statement by the departmental Secretary to the Parliamentary Joint Committee on Security and Intelligence, to the effect that it was a crime for a person without the requisite security clearances to handle security documents and that the AFP Commissioner would be duty bound to investigate such circumstances, with the fact that Ministers receive security documents and are not security cleared. In answering that question, Home Affairs noted:
The [PSPF] states that access to sensitive or classified information is restricted to those who have appropriate security clearances and need to know that information.
As set out in the PSPF core requirements relating to access to information, some Australian office holders are not required to hold a security clearance to access information while exercising the duties of office.
Drafting of the bill
1.53
In its submission, Home Affairs set out a number of concerns in relation to the drafting of the bill. These concerns included:
a lack of clarity in the purpose and intention of the report produced pursuant to clause 5 of the bill;
questioning whether there was a 'clear and principled basis for distinguishing Ministers of State from other Members of Parliament required to access security classified information in the course of their duties';
the apparent lack of discretion provided to the Director-General in determining what information and inquiries should be undertaken in respect of the report;
noting that there was no provision for how adverse material, or potentially adverse material, may be used by the Prime Minister, nor was there any clarity on whether the subject of the report would be notified of the adverse material;
outlining the consequences of a report produced under the bill not being a 'security assessment' as defined in the ASIO Act;
pointing out that the timeframes in the bill for the completion of assessments may not be achievable in practice;
a lack of procedures for the ongoing maintenance of the security checking process or for Ministers to report changes in personal circumstances;
the costs and resourcing implications arising from the bill; and
the potential for reports to be subject to judicial review.
Committee view
1.54
The committee considers that there are sound reasons why Ministers are not subject to the same forms of scrutiny as ministerial staff and public servants. These reasons are central to the two qualifications for holding a ministerial office under the Westminster system: first, election by the people as a member of parliament and, secondly, an invitation from the Prime Minister to join the ministry.
1.55
In respect of the first qualification, the committee notes that, in contrast to ministerial staff and public servants, ministers are not Commonwealth employees. Rather, ministers are public officials who are directly accountable to the public. It is therefore appropriate that ministers are required to publicly declare any relevant interest that they may have which could influence them in the exercise of their duties.
1.56
In respect of the second qualification, the committee notes that it is the Prime Minister who bears the burden of ensuring that ministers are qualified and appropriate for their role. The Prime Minister appoints ministers with the knowledge that these appointments will be scrutinised through robust democratic parliamentary and political processes under the Westminster system.
1.57
For those reasons, the confidential security vetting process—as proposed in the bill—is not a necessary or appropriate substitute for, or supplement to, the public and parliamentary scrutiny that comes with holding a ministerial role.
1.58
The committee recommends that the Senate does not pass the bill.
Senator James Paterson
Chair