Director-General's Statement to the
Parliamentary Joint Committee on Intelligence and Security (PJCIS) hearing
into the Review of Administration and Expenditure No 6, 2006-07
25 August 2008

I thank the Committee for the opportunity to make some opening remarks in support of ASIO's submission to the Committee's review of administration and expenditure, for the 2006-07 year.

While my comments will focus on the review period of 2006-07, I note that during 2007-08 financial year ASIO continued to develop further a number of its administrative processes, consistent with the trends that are discussed in detail in ASIO's submission for these proceedings.

Today I will provide a brief snapshot of the security environment, and what ASIO is doing to respond to the challenges it generates.

I will then highlight some of the administrative arrangements ASIO has in place to support its efforts to protect Australia and Australians from threats to security.

The security environment

The security environment facing Australia is dynamic and challenging. The threat of terrorism, which is manifest chiefly in the global violent jihadist movement, will endure as the most significant threat to Australia's interests for the foreseeable future. Tactically the threat is manifest in attacks against civilians as well as governments, while strategically it aims to influence and degrade institutions and principles that are fundamental to Australia's social, economic and security interests.

Al-Qa'ida continues to be the vanguard of this movement, and continues to conduct, sponsor, and inspire terrorist activities.

• From its base in the border regions of Pakistan and Afghanistan, core al-Qa'ida is regrouping and retains the intent and capability to plan spectacular terrorist acts against western interests.
  
• Some jihadists in other regions, such as the Gulf, the Middle East, and Africa, adhere to al-Qa'ida's ideology and have forged alliances with core al-Qa'ida.
  
• And the ideology of violent jihad - often disseminated through the Internet - continues to resonate with a small but dangerous minority, who may have no connection to al-Qa'ida but who plan and undertake independent acts of terror in pursuit of a global jihadist ideology.

Within Australia, a small minority of the community adheres to this ideology, and an even smaller minority is prepared to act in support of it.

• A number of Australians have been, or are currently being tried before the courts on serious terrorism-related charges.
• Australians have travelled overseas to associate with extremists or participate in violent jihad.
• And Australia, like many other countries, is tackling the problems of radicalisation and 'home grown' extremism.

The international nature of the violent jihadist movement means that many threats against Australia's interests develop and manifest themselves overseas. And of those threats that directly target us within our own borders, a high proportion have significant overseas links.

But there are other threats to Australia's interests beyond terrorism.

• Australia's wealth - in terms of our economic strength, technological development, rich resources, and strong global partnerships - makes us a potential target for espionage and foreign interference.
  
• And we must be ever vigilant against the threat posed by the proliferation of weapons of mass destruction.

ASIO's response to the security environment

I think it is important to remember that none of these threats is new - although some have taken on a greater urgency and complexity in recent years. ASIO's ability to respond to them relies on high quality staff, robust information systems, and a sound assessment base built on ASIO's long experience in the field of security intelligence.

To deal with the threats we face, ASIO is at the mid-point of a program, implemented as a result of Mr Allan Taylor's 2005 review of ASIO resourcing, to build capability across its functions.

• We are enhancing our ability to collect intelligence through human and technical means.
• We are building on our existing liaison relationships, and forging new relationships, both in Australia and overseas.
• We are investing in advanced information technology systems, and the people to drive them, that will allow us to use innovative techniques to identify threats from complex data sets.
• We are continuing to refine the range of reporting we provide to government, our liaison partners, law enforcement agencies, and the business community, to ensure our advice is tailored to customers' needs.
• And we are investing in our most important asset - our people - to ensure that we attract and retain high calibre staff who bring a diversity of experience and skill to ASIO.

ASIO's administrative response

This period of capability growth has brought an attendant increase in ASIO's revenue from Government - from $66 million in 2001-02, to $227 million in 2006-07.

• And this in turn has brought challenges. ASIO must be able to maintain its ability to identify, investigate, and advise on threats to security while managing its capability growth.

ASIO has undertaken a range of programs to ensure it is able to balance these competing, but equally important, priorities.

• In July 2006, ASIO moved to a nine Division structure, as the first phase of its expansion plan. We undertook further enhancements in July 2007, with a move to 12 ongoing and one non-ongoing Divisions.
• These new Divisions, and new Branches within them, allow redistribution of workloads in areas such as Legal services, and support to ASIO's operations.
• We also expanded our corporate governance arrangements to support this new Divisional structure, by implementing two new committees.
• One that focuses on ASIO's corporate culture.
• And another that oversees development of technical collection and analysis capabilities.
• In 2006-07 we recruited a net 246 staff, which significantly exceeded our growth target and brought our staffing level to 1356 by 30 June 2007. To attract these new staff in a tight labour market we engaged in innovative recruitment campaigns and streamlined our recruitment processes.
• We reviewed and commenced implementation of an improved internal training and staff development program to ensure that our training continues to align with our organisational needs, and that we obtain the best value for money.
• We continued work on refurbishing or relocating our state and territory offices to meet our growing accommodation needs. And we commenced planning to construct a new ASIO Central Office in Canberra.
• And we continued to focus our efforts on improving our service delivery for security assessments, especially for visas. Workflows in this area are increasing steadily.
• In 2006-07 ASIO issued nearly 210,000 security assessments, including over 53,000 visa security assessments.
• Compared to 2000-01 when ASIO issued just over 45,000 security assessments, including 34,000 visa security assessments.

Conclusion

ASIO works in a volatile security environment in which we must respond quickly, and be flexible about our investigative priorities. What is important one day may be overshadowed by an even more immediate priority the next.

We often have to interpret fragmentary or contradictory information while at the same time providing advice that is meaningful, authoritative, timely, and relevant to our customers' requirements.

The need to act lawfully, with probity, and with due regard for the rights of Australians is a paramount consideration in all aspects of our work. And it is the reason we afford such high priority to engaging and cooperating with the oversight and accountability framework that has been built around the Organisation. This framework includes, of course, the PJCIS.

The challenge ultimately for ASIO is to strike a balance between responding to immediate security priorities and ensuring the Organisation is sufficiently agile, resilient and capable to respond to future challenges. This will be achieved through ASIO's well-planned program for building and maintaining capability, the centrepiece of which is a strong collective of dedicated and professional ASIO officers.