Senate debates

Tuesday, 26 June 2018


Counter-Terrorism Legislation Amendment Bill (No. 1) 2018, Treasury Laws Amendment (2018 Measures No. 2) Bill 2018; Second Reading

6:18 pm

Photo of Nigel ScullionNigel Scullion (NT, Country Liberal Party, Minister for Indigenous Affairs) Share this | | Hansard source

I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—


The Australian Government is committed to ensuring the safety and protection of the Australian community. Law enforcement and security agencies must have access to the tools and capabilities they need to manage the ever-evolving terrorist threat.

To this end, and consistent with the recommendations of the Parliamentary Joint Committee on Intelligence and Security (PJCIS) and the Independent National Security Legislation Monitor (INSLM), this Bill extends the counter-terrorism powers and offences that are scheduled to sunset on 7 September 2018.

The control order regime, the preventative detention order regime, the declared areas offences, and the stop, search and seizure powers will continue for a further three years, until 7 September 2021.

Control orders under Division 104 of the Criminal Code are a key preventative tool to disrupt planning for terrorist acts. They allow for the overt, close monitoring of terrorist suspects who pose a risk to the community — either directly, or by facilitating others. Each of the controls in a control order must be reasonably appropriate and adapted to protect the public from a terrorist attack.

Preventative detention orders under Division 105 of the Criminal Code are also an important tool in preventing an imminent terrorist attack. They allow a person to be detained without charge to prevent a terrorist act or to preserve evidence of such an act. The gravity of these powers means that they can only be used where the AFP reasonably suspects an attack could occur within 14 days.

The declared areas offences in section 119.2 of the Criminal Code form part of the Australian Government's efforts to stop the flow of foreign fighters. They make it an offence to enter, or remain in, conflict zones in a foreign country in which terrorist organisations operate, and that is declared by the Minister for Foreign Affairs. There are only very limited reasons for entering such an area, other than to participate in the conflict or train with terrorist organisations. The offences recognise this by allowing for a small range of exceptions.

Finally, the stop, search and seizure powers in Division 3A of Part IAA of the Crimes Act give police officers appropriate powers to act in the event of, or in anticipation of, a terrorist act. These powers allow police to request a person to provide their name, address and certain other details, stop and detain a person to conduct a search for a terrorism related item, seize terrorism related items in Commonwealth places such as airports, and enter premises without a warrant to prevent a terrorist act or avert a serious and imminent threat to a person's life, health or safety.

These powers and offences have been used rarely since they were enacted. Six control orders have been made since 2005. However, there have been no preventative detention orders made, and no incidents demanding the use of the stop, search and seizure powers. As the PJCIS and INSLM both recognised, the sparing use of these powers is not an argument that they are irrelevant. Rather, it underscores that the AFP and others have been appropriately judicious in exercising these powers, and that the extreme circumstances for using a number of them have thankfully not yet arisen.

The Bill will also continue the Australian Security Intelligence Organisation's questioning, and questioning and detention powers, in Division 3 of Part III of the Australian Security Intelligence Organisation Act 1979. These powers will be extended for a further 12 months until 7 September 2019.

This will enable the Government to consider the PJCIS's recommendations in relation to ASIO's powers. In the meantime, ASIO will continue to have access to these important tools in its efforts to gather critical intelligence to enhance Australia's counter-terrorism efforts.

Importantly, all the extended regimes will continue to be subject to extensive, and in some cases extended, safeguards and oversight.

Other technical changes

The Bill also makes a number of technical and procedural changes to implement other PJCIS and INSLM recommendations about control orders and declared areas.

The Bill will extend the minimum time period between an interim and a confirmation hearing for a control order from 72 hours to seven days. This will more realistically reflect the minimum time it takes for both parties to prepare for confirmation proceedings.

The Bill will also allow the person the subject of a control order or the AFP to apply to vary an interim control order, but only with the other party's consent. This is to provide flexibility for both parties to seek minor changes to the original terms of an interim order, but not the substantive terms of the order.

Further, the Bill will make clear that a court generally cannot order costs against the subject of control order proceedings. This reflects the AFP's long-standing practice, and recognises the significance of control order proceedings. However, the Bill will allow the AFP to seek costs where the subject of the proceedings has conducted their case unreasonably.

In relation to the declared area offence, the Minister for Foreign Affairs will be authorised to revoke a declaration of a declared area even where the legislative test for the declaration continues to be met. This will allow the Minister to revoke a declaration that may be no longer necessary or desirable, but where hostilities against a terrorist organisation may still be ongoing.

The Bill will also amend the list of legitimate purposes for entering a declared area so that it more clearly allows for the important role that the International Committee of the Red Cross performs in conflict situations.

Additional oversight

With such counter-terrorism powers and offences comes important responsibility. Therefore the Bill will require information on the exercise of these powers to be collected and introduce additional oversight measures.

The AFP will be required to notify the PJCIS in writing after the making of initial or continued preventative detention orders or a prohibited contact order. These measures provide the PJCIS with additional oversight of these orders.

The PJCIS will also have the power to report to Parliament on any declaration made by the Minister for Foreign Affairs under section 119.3 of the Criminal Code at any time while the declaration is in effect, including during the disallowance period.

The Bill also implements PJCIS recommendations in relation to reporting on the use of stop, search and seizure powers in Division 3A of Part IAA of the Crimes Act 1914. There are currently no such reporting obligations. The Bill will require the AFP to report as soon as practicable after the exercise of these powers and require the Minister to table an annual report on the exercise of the powers. These measures will thus provide enhanced transparency and oversight.

The important functions of the PJCIS will also be further strengthened through amendments to the Intelligence Services Act 2001. The PJCIS will continue to have a duty to review the operation, effectiveness and implications of the control order, preventative detention order, declared areas offences, and stop, search and seizure powers. As with its recent statutory review, the PJCIS will be required to provide a further report on the extended legislative regimes by 7 January 2021.

The PJCIS will also be empowered to monitor and review the performance by the AFP of its functions under Division 3A of

Part IAA of the Crimes Act, and the exercise of the Minister for Home Affairs' power to declare prescribed security zones.

Minor machinery of government changes

Finally, the Bill makes technical amendments to the Criminal Code to reflect the new division of responsibilities between the Attorney-General and the Minister for Home Affairs following the recent machinery of government arrangements.

Concluding remarks

This Bill ensures law enforcement and security agencies continue to have the capabilities to deal with the changing national security and threat environment while also protecting individual rights, including through further transparency and oversight measures.

The measures in this Bill implement the first part of the Government's response to the recommendations of the PJCIS and the INSLM's recent reviews. The second part of the Government's response to these reports—which concerns the creation of an extended supervision order scheme—will form part of a further Bill to be introduced later in 2018.

The PJCIS and INSLM have comprehensively examined the counter-terrorism provisions addressed in this Bill and have recommended, in light of the current threat environment, that they be continued. I acknowledge and appreciate the extensive and continuing work of the PJCIS and INSLM.

I also appreciate the ongoing partnership with states and territories in our joint effort to keep the Australian community safe.

To this end, this Government is unwavering in its commitment to ensuring Australia's counter-terrorism and national security framework continues to be as robust and responsive as possible.


The Government is committed to supporting the Australian innovation ecosystem by providing a tax and regulatory environment that will help innovative Australian businesses raise capital, grow and succeed; and get more Australians into more and better paying jobs.

This Government, the Turnbull Government, is the government of innovation, jobs and business creation. We want to see new businesses and new enterprises get off the ground and get going.

As promised in the Budget, we are putting in place the world's most forward-leaning regulatory sandbox for FinTech development.

The Turnbull Government sees an active FinTech sector as a critical driver of more competition in financial services. We want to see competition, because it will increase the pressure on financial providers — traditional and emerging — to be more responsive to consumers' needs and deliver better outcomes for Australians.

I am a strong believer that choice empowers consumers to seek the financial services that best suit their needs without being tied to businesses that don't listen.

The enhanced regulatory sandbox will allow firms to test new products and services without needing to obtain a financial services licence or a credit licence from ASIC first. It will allow trial and error in a controlled environment, giving firms a chance to confirm their concept through initial testing with clients.

In simple terms, this will help Australians and Australian businesses to access cheaper financing and better financial products so they can grow and invest. The productivity benefits that will flow from this will be huge. Most investment equals more jobs and better wages.

Those in business know the importance of meeting customer needs. The regulatory sandbox will provide a means to test market demand. It will give firms looking to do things differently — to do things better for consumers — a real leg up and clear air to get going. It will reduce the time it takes to make their products and services available to consumers' and it will mean entrepreneurs are more informed in making decisions on their offering before applying for a licence.

We have worked hard to develop a legislative regulatory sandbox which builds on ASIC's licence exemption. But we have also been mindful of ensuring the firms in the regulatory sandbox maintain protections for retail consumers.

The Government's enhanced sandbox is about helping FinTech businesses overcome the initial regulatory burden and costs of licensing that may otherwise hinder innovative offerings.

Schedule 1 to this Bill takes the first step. It extends the regulation-making powers in the Corporations Act, establishing the foundation for the Government's new framework.

The regulations will then set out the detail regarding eligibility criteria, the types of products and services that can be tested, and conditions that will need to be met during testing.

Prescribing the detail in regulations will mean timely adjustments can be made in response to the evolving market. This will ensure the regulatory sandbox stays fit for purpose in this rapidly moving sector. This approach, which combines legislative authority and flexibility, sets Australia apart from its international peers.

The draft regulations were released for public consultation between late October and November. The Government will consider those responses as we work to finalise the design of the regulations.

Under the proposal released for consultation, businesses will be able to test a wider range of new and innovative FinTech products and services. This includes holistic financial advice, the issuing of consumer credit contracts and facilitating crowd-sourced funding.

An extended 24-month testing timeframe was proposed and will give more time for businesses to adjust their offering as they evaluate commercial interest and test the validity of their concepts.

As I've mentioned, while businesses will be able to operate without a licence, they will still be required to meet key consumer protection requirements including responsible lending obligations, best interests duty, and to have adequate compensation and dispute resolution arrangements.

I believe the regulatory sandbox will be a game changer. It will support businesses that could revolutionise the financial services sector — right across the spectrum of innovation, including payments, insurance, credit, data and analytics and personal finance management.

Consumers are already benefiting from the emergence of FinTech firms. These nimble and consumer focused firms are putting pressure on traditional financial services providers to be more responsive and to deliver better outcomes for Australians.

I would like to thank the FinTech industry for their work with the Government to develop the regulatory sandbox and other initiatives we have progressed in the last two years.

The regulatory sandbox will no doubt be a source of many breakthrough innovations in FinTech in the coming years.

Schedule 2 to this Bill makes a number of minor technical amendments to the Early Stage Venture Capital Limited Partnership, Venture Capital Limited Partnership and Tax Incentives for Early Stage Investor regimes to clarify the income tax law and ensure that these provisions operate in accordance with their original policy intent.

The Tax Incentives for Early Stage Investors measure and the New Arrangements for Venture Capital Limited Partnerships measure were introduced as part of the National Innovation and Science Agenda. Together, these measures are designed to promote an innovative, risk-taking and entrepreneurial culture by providing incentives for investors to invest in Australian innovative, high growth potential start-ups and venture capital.

The amendments being made by this Bill will ensure that investors in innovative Australian businesses continue to benefit from effective, generous Government support and have certainty as to how these programmes are intended to operate.

Full details of the measure are contained in the Explanatory Memorandum.

Debate adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.