Explanatory Memorandum
(Circulated by the authority of the Minister for Defence, Senator the Hon Marise Payne)GENERAL OUTLINE
1. The Intelligence Services Amendment (Establishment of the Australian Signals Directorate) Bill 2018 (the Bill) implements the recommendations of the 2017 Independent Intelligence Review to establish the Australian Signals Directorate (ASD) as an independent statutory agency within the Defence portfolio reporting directly to the Minister for Defence, as endorsed by Government. This Bill also includes a number of other related amendments following the establishment of ASD.
The 2017 Independent Intelligence Review
2. On 7 November 2016, the Prime Minister, the Hon Malcolm Turnbull MP, announced that Mr Michael L'Estrange AO and Mr Stephen Merchant PSM would jointly undertake an independent review of the Australian Intelligence Community. The timing of the review is consistent with the 2011 Independent Review of the Intelligence Community recommendation that periodic review occur every five years.
3. On 18 July 2017, the Prime Minister released the unclassified version of the 2017 Independent Intelligence Review (the Review) report. The Review made 23 recommendations in relation to the structural, legislation and oversight architecture of the intelligence community, including the establishment of ASD as an independent statutory agency within the Defence portfolio.
Brief History of ASD
4. The history of ASD begins in the Second World War, when Australian Navy, Army and Air Force personnel were brought together to support General MacArthur's South-West Pacific campaign by intercepting and decoding Japanese radio signals.
5. After the war, as the wartime signals intelligence units were wound down, government approval for a new peacetime signals intelligence organisation was given on 23 July 1946. The new Defence Signals Bureau opened at Albert Park Barracks, Melbourne, on 12 November 1947. Its role was to exploit foreign communications and be responsible for communications security in the armed services and government departments.
6. The bureau was renamed Defence Signals Branch in October 1949, a title it retained until January 1964, when it became the Defence Signals Division. As a result of an inquiry in 1977 into intelligence and security, the Defence Signals Division was renamed the Defence Signals Directorate (DSD) and made directly responsible to the Secretary of the Department of Defence.
7. In June 1988, the government decided that DSD should move to Defence headquarters at Russell Offices, Canberra, to facilitate a closer relationship with Defence, other intelligence agencies and key government departments.
8. In recognition of successive Australian Government's increased reliance on the provision of online services and commensurate information security exposure, in January 2010 DSD established the Cyber Security Operations Centre (CSOC). The CSOC was required to develop a comprehensive understanding of ICT security threats to critical Australian systems, and to coordinate a response to those threats across government and industry.
9. In May 2013, DSD was renamed the Australian Signals Directorate (ASD) to reflect its whole-of-government role in support of Australia's national security.
10. In November 2014, the CSOC evolved into the Australian Cyber Security Centre (ACSC), which is the next evolution of Australia's cyber security capability. ACSC sees the co-location of all contributing agencies' cyber security capabilities, including:
- a)
- ASD's cyber security mission - the Commonwealth authority on information security provides advice and assistance to Australian Government agencies;
- b)
- Computer Emergency Response Team (CERT) from the Attorney-General's Department - the point of contact in government for cyber security issues affecting major Australian business;
- c)
- representatives of the Australian Federal Police, who investigate and respond to cybercrime of national significance;
- d)
- the Australian Criminal Intelligence Commission, which discovers, understands and prioritises cybercrime threat intelligence to enhance response options;
- e)
- cyber investigations and telecommunication security specialists from the Australian Security Intelligence Organisation; and
- f)
- strategic intelligence analysts from the Defence Intelligence Organisation.
11. The ACSC is currently the joint responsibility of the Attorney-General and the Minister for Defence.
Proposed arrangements
12. ASD has evolved from a primarily Defence signals collection agency after World War II to become Australia's national signals intelligence authority for collecting intelligence, supporting the military, and undertaking cyber security and effects operations through the application of advanced technologies. ASD is now a genuinely national asset, playing a much broader role than that defined by its previously exclusive Defence focus.
13. In broad terms, the Bill will separate ASD from the Department of Defence, and establish it as an independent statutory agency under the control of the Director-General of ASD. The Bill will also amend ASD's functions to allow the ACSC to cooperate with the persons and bodies listed in the Act and to operate within ASD, in accordance with recommendation 3(b) of the Review. Related to the transition of ACSC, CERT and its functions relating to cyber policy and security will also be transferred from the Attorney-General's Department to ASD. CERT was established in 2010 as the national computer emergency response team, and is the primary government contact point for major Australian businesses in relation to matters involving cyber security.
14. Specifically, the Bill implements the recommendations of the Review by:
- a)
- amending ASD's functions to include providing material, advice and other assistance to any person or body listed in the Act (rather than Commonwealth and State authorities only) on matters relating to the security and integrity of information that is processed, stored or communicated by electronic or similar means, which will allow the ACSC to liaise with industry;
- b)
- amending ASD's functions to include preventing and disrupting cybercrime. This section will provide ASD with a function to prevent and disrupt, by electronic or similar means, the use of information and communication technologies to commit or facilitate serious crime by people or organisations outside Australia. Serious crimes, such as child exploitation and illicit narcotics, will be captured by this new function;
- c)
- establishing ASD on a statutory basis, and providing provisions for the appointment of the Director-General of ASD to control ASD and its staff;
- d)
- requiring the Director-General of ASD brief the leader of the Opposition about matters relating to ASD;
- e)
- giving the Director-General of ASD powers to employ persons as employees of ASD under this Bill (outside the frame of the Public Service Act 1999);
- f)
- amending other legislation as appropriate to replace references to 'Director of ASD' with 'Director-General of ASD', and to remove references to the Department of Defence.
15. In relation to the employment of staff, ASD will operate outside of the Public Service Act 1999 (Public Service Act) framework. This will provide ASD with greater flexibility to recognise the skills of its specialised workforce. This structure will reflect the need to retain those individuals with highly sought after skills, such as those with STEM (science, technology, engineering and maths) qualifications. The Bill will allow for transfers of employment from ASD to the Australian Public Service. ASD will be required under the Bill to adopt the principles of the Public Service Act in relation to employees of ASD to the extent the Director-General of ASD considers they are consistent with the effective performance of the functions of ASD.
16. The Bill also includes an additional function for ASD, to protect the specialised technologies and capabilities acquired in the performance of its other functions. To carry out its functions to obtain intelligence, provide assistance to the Australian Defence Force, to assist other Commonwealth and State authorities, and to combat cybercrime, ASD uses specialised tools. ASD needs to be able to protect those tools to ensure their ongoing utility and protect Australia's national interests.
17. The Bill also includes a number of transitional provisions to ensure the good governance of ASD continues during the implementation of the new arrangements.
Financial Impact Statement
The Act will have no additional financial impact.