Senator the Hon Mathias Cormann

PRIME MINISTER: Good afternoon. We are very fortunate to live in the most successful multicultural society in the world. Its foundation is fundamentally Australian values; the rule of law, mutual respect, equality, a fair go.

We are the most diverse society in the world. Australians come from every possible background, every faith and we live together harmoniously.

There is much to be proud of and much to protect. My Government will always seek to ensure that our values, our culture, our democracy, remain uniquely Australian.

That is a culture of freedom, the rule of law, mutual respect, a fair go. That is what defines us. These are values that are available to everybody. We don’t define our nation or our identity, by reference to our religion or the colour of our skin, or our cultural background. It is a remarkable achievement.

We should be so proud to be Australians, but we cannot take it for granted. So we must ensure that our politics and our Parliament is strong enough to withstand attempts by foreign powers to interfere or influence it.

We should not be naive about this; foreign powers are making unprecedented and increasingly sophisticated attempts to influence the political process both here and abroad.

That’s why I am here with my colleagues, Senator Brandis and Senator Cormann, to announce the most significant reforms to Australia’s foreign interference laws in decades.

They will protect our way of life.

They will protect and strengthen our democracy.

They will ensure that Australians make decisions based on the wishes of Australians, underpinning our commitment to each other and the democracy that keeps us free.

The changes we’re unveiling today are a result of work I commissioned from the Attorney-General back in August last year into foreign influence, interference and coercion. The work of my Department, the work of ASIO, the Attorney-General and others, revealed the magnitude of the threat, but also that agencies lacked the legislative tools they needed to act.

The legislation spoke of a different era frankly and we needed new laws for new times.

I want to be very clear, we are focused on the activities of foreign states and their agents in Australia, not the loyalties of Australians who happen to be from another country. We are a nation where most of us come from migrant families - perhaps more evident in the Parliament recently than before - and our communities are part of the solution, not part of the problem. We are proudly multicultural. But, we have to recognise that particularly with all of the access that the digital technology gives you, there are more attempts from outside Australia, from foreign countries to influence our political activities.

Now, interference is unacceptable from any country, whether considered on any view, friend or foe.

The fundamental principle that we assert is the sovereignty of Australia and the sovereignty of Australians to make their own decisions in their own democracy.

Now, we will not tolerate foreign influence activities that are in any way covert, coercive or corrupt. That’s the line that separates legitimate influence, from unacceptable interference. This has led us to a Counter Foreign Interference strategy built upon transparency, law enforcement, deterrence and capability.

We have recently seen disturbing reports about Chinese influence. I take those reports, as do my colleagues, very seriously. But these reforms are not about any one country. Foreign interference is a global issue. For example, we are all familiar and I know you’re all very familiar, with very credible reports that Russia sought to actively undermine the United States election, undermine the integrity of the US election and seek to influence it. I flagged the concerns about foreign influence last year and I flagged them this year and we’ve directed our intelligence agencies on several occasions now, to warn other political leaders, leaders of other political parties here and indeed the directors of other political parties.

We’ve got every reason in Australia to be optimistic. Our institutions are strong and robust, with the rule of law and an independent media. But the threat is real.

That’s why the legislation we’re introducing this week will reinforce the strengths of our open democratic system, while shoring up vulnerabilities. The reforms will include a new Foreign Influence Transparency Scheme. The principle is straightforward; if a person or entity engages with the Australian political landscape on behalf of a foreign state or a principal, then they should register. Both elements are required, the ties to the foreign player and the advocacy.

This will give the Australian public and decision-makers proper visibility when foreign states or individuals may be seeking to influence our political processes and public debates. Being registered, I should say, should not be seen as any kind of taint and certainly not a crime. But if you fail to disclose your ties, then you will be liable for a criminal offence.

This is all about transparency and as George will describe in a moment, of course, it has been derived from and modelled on legislation in other countries. It’s an improved version in fact of the Foreign Agent Registration arrangements in the United States.

We’ll also introduce a set of foreign interference offences into the Criminal Code to ensure our agencies have the tools they need to do the job. These offences capture covert conduct, that is intended to serve the intelligence objectives of a foreign actor. They will include, for the first time, offences for acts of foreign interference. ASIO has long been able to investigate, law enforcement will now be able to act. Given the extreme threat these activities pose to our national security, the offences carry very severe penalties.

The body of work will be complemented by another bill that Mathias will speak about, on electoral reform to ban foreign political donations. This change will protect the integrity of the Australian political system. It will provide voters with greater confidence and it will boost transparency in our elected institutions.

Now, as a set of reforms, any one of these would be very significant. But together, this will be the most significant overhaul of our espionage, counter-intelligence and political donation legislative framework, in decades.

So I will now ask the Attorney to go into more detail.

SENATOR THE HON. GEORGE BRANDIS QC - ATTORNEY-GENERAL: Thank you very much indeed, Prime Minister, and as the Prime Minister has said, the purpose of this package of bills is to protect the integrity of Australian democracy and the integrity of the Australian political system. There are three principal bills, two of which are the responsibility of the Attorney-General, and one of which, concerning political donations, is the responsibility of the Special Minister of State. So let me deal with the two bills that fall within the Attorney-General's responsibility.

Let me start with the bill that modernises existing offences and creates an important new offence. The National Security Legislation Amendment (Espionage and Foreign Interference) Bill contemporises and, in some respects, broadens the existing crimes of treason and espionage under the Commonwealth Criminal Code and the Commonwealth Crimes Act. The offence of treason is contemporised, the language has been brought up-to-date so that it aligns with contemporary international humanitarian law. The offence of espionage is being contemporised and broadened so that there will be a broader category of conduct caught within the offence of espionage. For example, the existing offence of espionage only captures passing on information in defined circumstances. The definition of espionage will be broadened to include possessing or receiving information, rather than merely communicating information. There will be a new offence that will criminalise, for the first time, soliciting or procuring a person to engage in espionage, and there will also be a new preparation and planning offence.

So the core concept of espionage will not change, but the breadth of the behaviours that are defined will change.

More importantly, there is a new offence introduced by the bill and that is the offence of unlawful foreign interference. That offence is designed to capture conduct inimical or harmful to the Australian national interest, which would not currently be captured by the offences of treason or espionage. It will be a crime, this I should say, these provisions operate prospectively, it will be a crime to by covert, deceptive or undisclosed conduct engage in behaviours for the purposes of a foreign actor, which harm Australia's security to influence or exercise the performance of any democratic or political right in Australia or influence a Commonwealth state or territory decision-making process. So that if you act covertly on behalf of a foreign actor, in a way that harms Australia's national security, to influence the political process, or a Government decision, that conduct will be criminalised.

The second piece of legislation, the second brick in this edifice, is the creation of a new Foreign Influence Transparency Scheme. As the Prime Minister has said, what this is, is a registration requirement. It is not directed to malicious conduct. The objectives of the offences bill is to broaden the basis on which malicious conduct is criminalised. The transparency scheme is aimed, as its name suggests, at transparency, so that we know who is seeking to influence the Australian political process and on whose behalf. It will apply to persons or entities acting on behalf of foreign Governments, foreign public enterprises, foreign political organisations, or foreign businesses who seek to affect the Australian political system, the outcomes of Australian elections, or the decision of a Government authority. Anything that bears upon the political, electoral governmental process engaged in by someone on behalf of a foreign actor, in this case whether covertly or overtly, and not necessarily for the purposes of harming the Australian national interests, will be required to register, much as lobbyists are required to register.

We have learned that there are many varieties of foreign interference in the Australian political system. Not all of them are malign but we should know about them. The public need for transparency should be satisfied. Some of them are malign, and when those influences are exercised covertly or in a maligned fashion, they should be captured by the criminal law. There is a gap in our criminal law at the moment that the offences bill fills. Not all of the vectors of foreign interference are financial, and that is why the offences provision by creating the new offence of foreign influence deals with both financial and non-financial conduct. But there is, of course, a specific need to deal with the use of money, particularly foreign political donations, so, I will pass to my colleague, Mathias Cormann, who administers the third element of the scheme.

SENATOR THE HON. MATHIAS CORMANN, MINISTER FOR FINANCE: Thank you very much, George, Prime Minister. Only Australians, Australian businesses, Australian organisations should be able to influence Australian elections via political donations. Whether that is through political parties, candidates, Senate groups or indeed significant political campaigners. That is why later this week I will introduce into the Senate, legislation to ban foreign political donations to all these categories of political actors. In order to give proper effect to this, we will also be introducing a new class of political actors into the Electoral Act. Namely the class of political campaigner, which will be defined as an organisation which has incurred more than $100,000 worth of political expenditure in any of the previous four years, or which has incurred $50,000 or more in political expenditure where that respects 50 per cent or more of their annual budget.

This is a very important piece of reform. It does, as the Prime Minister says, go to the integrity of our electoral system and the confidence that the Australian people can have in the integrity of our electoral system in making sure there is no undue influence on our democratic processes. I might just pre-empt one question that some have put to me in recent times. Contrary to what has been asserted by some, this does not prevent charities from receiving and using foreign donations for non-political activities in Australia. Similarly, it does not prevent charities from engaging in political activities in Australia, as long as the political expenditure incurred to fund that political activity is raised from Australians, Australian businesses and Australian organisations. So, this is an important part of the overall package, which will complement the Bills that the Attorney has outlined.

PRIME MINISTER: Very good.

JOURNALIST: So, say the example of an MP receives money from say, a Chinese company for example, would that come under any of these laws that you’re proposing today?

PRIME MINISTER: When you’re saying, are you talking about a political donation?

JOURNALIST: Like Senator Dastyari.

PRIME MINISTER: Well, Senator Dastyari solicited money from a Chinese national, apparently from a company that he owned and in return for that, did a U-turn on the Australian Labor Party's policy on the South China Sea. It was about as blatant an act of political interference that you could imagine.

If I could just repeat this; I mean the simple fact of the matter is, that Senator Dastyari's presence in the Senate and in the Labor Party Caucus speaks volumes for the lack of character of Bill Shorten.

Bill Shorten is keeping Dastyari there, when he knows that Dastyari sold out Australia's national interest in return for having his debts paid, in return for a personal benefit.

Then of course, went on to give counter-surveillance advice to a Chinese national who he suspected may have been being watched by ASIO.

How a man that seeks to be Prime Minister of Australia and leader of this nation, could so shamefully abandon our national interest by leaving Dastyari in his team, is extraordinary.

This is an indictment on Bill Shorten.

JOURNALIST: Do the new laws cover examples like that?

PRIME MINISTER: Well I’ll ask George to speak about the law.

ATTORNEY-GENERAL: Well as the Prime Minister has instanced the case of Senator Sam Dastyari, let me point out to you the elements of the new offence of intentional foreign interference. It creates a criminal offence in circumstances in which a person engages in conduct on behalf of a foreign principal that will influence a political or governmental process, which I should interpolate to say would include the policies of both the Government party or the Opposition party, and is either covert or involves deception, or involves the person causing serious harm to the Australian national interest. Now, you know the allegations that have been made against Senator Dastyari. In my view, the conduct alleged against him does not reach the threshold of the existing laws of treason and espionage, but that is why we are introducing, because of the gap in those laws, a new offence of unlawful foreign interference.

PRIME MINISTER: Hang on, hang on. Sam and then James.

JOURNALIST: Two questions, in relation to him, his instruction to Mr Huang to leave his phone behind, you don't think he's broken any law?

Secondly, according to AEC disclosures within the same day that the ChAFTA deal was signed, a group, a company that Mr Huang was a director of, made a $50,000 donation to the Bayside Forum that the Trade Minister's electorate, do you think that was appropriate? Mr Robb also then went to work for that Chinese company shortly after leaving politics. Is that Chinese influence or is that something different?

PRIME MINISTER: Well, why don't you answer the question first?

ATTORNEY-GENERAL: Well, in relation to Senator Dastyari, at the moment these are allegations, but they are credible allegations, made by serious journalists, which Senator Dastyari was given every opportunity to address and either deny or explain in the Senate last Thursday. He took the opportunity that was presented to him by the Senate to make a statement, and in that statement, significantly, he neither denied nor explained any of the allegations that had been made against him by either Fairfax Media, the ABC or other journalists. That's the first point.

Now in relation to the particular conduct that is alleged, I'm not going to act as a judge and jury here, but plainly it is untenable that a man who is clearly by his own admission by silence, acting at the behest of a foreign principal, to undermine the foreign policy of the alternative Government in which he would have been a very influential figure, a minister close to the alternative Prime Minister. It is untenable that a person like that should be so close to the seat of power in the Labor Party.

JOURNALIST: Is it appropriate for a Liberal minister in Andrew Robb's case, to so quickly after leaving Government and being intimately involved in the negotiations with the free trade, to then go and take up that work?

PRIME MINISTER: Well the Free Trade Agreement was negotiated and entered into while he was the Minister. You’re asking about his post-ministerial employment, which as you know, Andrew has made it very clear he's complied with the ministerial code of conduct.

But there are some changes in the law which touch on ministers and I’ll ask George to expand on them.

ATTORNEY-GENERAL: Thank you, Prime Minister. So, somebody in Mr Robb's position would be required to register under the transparency scheme. A person who has been a Cabinet Minister within the previous three years must register if he acts on behalf of a foreign Government, a foreign public enterprise, a foreign business or a foreign political organisation.

As well as that, there is an obligation to register under the transparency scheme for other former Members of Parliament or senior Commonwealth officials acting on behalf of those same foreign principals or entities if they use their skills, knowledge, experience or contacts gleaned from their time as a Member of Parliament or a senior Commonwealth official.

PRIME MINISTER: Okay, Chris? Go to Chris and then James.

JOURNALIST: I know you’re not just speaking about China, but can I give you a series of organisations that exist in Australia which some would see as acting on behalf of China? The Australian Council for the Peaceful Reunification of China, the Confucius Institutes which our now existing inside our universities and some might even say the organisation that Bob Carr runs, which was first funded by Mr Huang Xiangmo. Now would any of these organisations have to register as being under the influence of a foreign Government?

PRIME MINISTER: George will address that.

ATTORNEY-GENERAL: Well, of course, it all depends on the facts of particular case. But, a foreign principal caught by the transparency scheme is not merely a foreign Government, but a foreign public enterprise, a foreign political organisation, a foreign business or an individual who is neither an Australian citizen, nor a permanent Australian resident. To lobby, is defined by the Bill as to communicate in any way with a personal group or persons for the purpose of influencing a process, decision or outcome and that has to be in relation to the political process or a Government decision, or an electoral outcome as well.

Now, if for example, you had a foreign political organisation which was established for the purposes of prosecuting a particular interest in Australia, then a person acting on behalf of a foreign political organisation would be acting on behalf of the foreign principal. But, Chris, it is important to say that the obligation to register only lies upon a person who is in a relationship with a foreign principal seeking to influence in the way that I have described.

JOURNALIST: With the banning of political donations, would that apply similarly to a group like GetUp! or would they still be able to solicit foreign donations so long as they didn’t use that money for political campaigning?

MINISTER FOR FINANCE: It would apply to an organisation like GetUp!, because GetUp! plainly is a political campaigning organisation. In the year leading up to the 2016 election, they spent more than $10 million on political expenditure. So, in fact, I am not aware of an organisation, a third party organisation, a political campaigning organisation, other than a political party, that spent more than GetUp! on political expenditure. Now, to ensure that there is no inappropriate foreign interference in our democratic system, we are banning all foreign donations, as I have said, not just for political parties, but also for candidates, for Senate groups and for political campaigning organisations. Political campaigners will be defined in the Electoral Act. Based on GetUp!’s past modus operandi they would be captured by that definition of political campaigners, which I would have thought is pretty self-evident.

JOURNALIST: Can I just clarify PM - sorry, had to step away a moment – people such as Bob Carr and Andrew Robb, will they have to appear on the register or not?

PRIME MINISTER: Well it depends, as George said. It depends on what they’re doing, but if they are in effect lobbying – which has been defined broadly and George just described that – on behalf of a foreign government or a foreign public entity, a foreign political and so forth, then they would be obliged to register.

JOURNALIST: Is that lobbying, or is that - ?

PRIME MINISTER: It depends what it does. Again, it depends what the work of the organisation is. Look, to be practical about it, you look at the US experience. Organisations that think they might, or individuals that think they might come within the ambit of the legislation would be wise to register. If in doubt, register, because then you’re not going to get into trouble for note registering. David?

JOURNALIST: Prime Minister what’s wrong with an environmental activists group in Australia for instance, taking money from environmental activists in the US? Would they be banned from taking that foreign money under this law?

MINISTER FOR FINANCE: If you are involved in political campaigning, then you can only rely on political donations from Australian citizens, from Australian businesses and Australian organisations. That is the intent of this reform and this is deliberately the intent of this legislation. Just going back to the question before, I have now got the numbers in front of me. So, in 2015-16 GetUp! spent $10,081,186 in political expenditure. That was more than twice as much as the next organisation, which was the Australian Education Union, on $4.9 million. By the definition that I have outlined to you, which is more than $100,000 in political expenditure in any of the previous four years, GetUp! would clearly be captured. What that means is that GetUp! would have to comply with the same transparency disclosure and reporting requirements as a political party, which at present they do not. It also would mean that they would be captured by the ban on foreign donations. Now, if GetUp! were to change its focus, if they were to stop involvement in political campaigning into the future and become a charity and would only be involved in non-political activities, then they would be absolutely free to receive and use foreign donations. Conversely, if GetUp! can continue to be involved in political campaigning, but all of the donations that fund their political expenditure would have to be sourced from Australian citizens, Australian business and Australian organisations.

JOURNALIST: Can I just check on that? How would you define for example an environmental charity compared to a political campaigner that’s campaigning on something like Adani or Save the Children if it’s campaigning on Manus Island for example? Would they be reclassified as a political campaigning organisation?

MINISTER FOR FINANCE: Political expenditure is already defined in the Electoral Act. We are not proposing to change the definition of political expenditure. Political expenditure essentially is defined as expressing support in favour of one party or the other, one candidate or another or in relation to election issues. That is the definition that is currently in the Electoral Act and it will remain the same.

ATTORNEY-GENERAL: In relation to the transparency scheme, similar principles apply. The purpose must be to influence the political process or a government decision.

JOURNALIST: Will these laws be applied retrospectively, for example in the case of Senator Dastyari?

ATTORNEY-GENERAL: No.

JOURNALIST: Prime Minister, are you concerned, Prime Minister Malcolm Turnbull are you concerned about details of an intelligence operation being splashed across the newspapers allegedly targeting Mr Huang and an elected official Senator Dastyari?

Has ASIO expressed any displeasure to you for details of this operation being publicised by the media?

Do you have any concerns about it being publicised? Or is it all fair in love and war?

PRIME MINISTER: George, do you want to comment on that?

ATTORNEY-GENERAL: Well, for a start, we don’t comment on what ASIO may or may not say to government.

These are allegations, but as I say they are allegations, which when the man against whom they were made were given the opportunity to explain or deny them, he neither explained nor denied them, so he must take the allegations to have been admitted by Senator Dastyari.

I’m not going to comment on any circumstance which might reflect upon the way in which these allegations came into the media. Of course it is important that the integrity of the national security agencies be protected. That is an extremely important value.

PRIME MINISTER: Sam, let me just add to this. The information, the allegations, which were published in the Fairfax press, basically to the point, the argument, the proposition was being made as we know, that Senator Dastyari went to a meeting with Mr Huang at his house. He told Mr Huang that he, Dastyari, believed that Mr Huang was under surveillance from security agencies and encouraged him to have a conversation in the garden, with the phones left inside, so that nobody could overhear what Mr Huang was saying to Senator Dastyari, or what Senator Dastyari was saying to Mr Huang. That was the nub of the story. The first I heard of it, or my office heard of it, was from the journalist.

JOURNALIST: [Inaudible] don’t back you on challenges to the Marriage Bill?

PRIME MINISTER: It’s a completely free vote. Everyone is entitled to vote as they wish, I’m not quite sure what part of ‘free’ you don’t understand. In our Party, in our parties, we have a free vote on the Marriage Bill and members will vote on the Bill or on different amendments, if different ways. That is their absolute right, okay?

That is what I promised at the election. We promised we’d give everyone a say. Labor did everything they could to prevent that, they failed.

Just hang on a minute. As far as a free vote is concerned, Labor said they were going to have a free vote. Then, Bill Shorten has said now: “No, there will be no free vote on the amendments.” That is much to be regretted, that is honestly completely contradictory and hypocritical to say that Labor members have got a free vote on the Bill, but not on the amendments. But anyway, that’s for Mr Shorten to explain. Just one more and then we must go.

JOURNALIST: Prime Minister will you be referring Labor Senator Katy Gallagher to the High Court? Attorney General, would you?

ATTORNEY-GENERAL: We are looking at the moment at the particulars that have been lodged by Senator Gallagher. It does appear that she is in an indistinguishable position from others who have been referred but that is a decision that will be made in the very near future.

I might point out that when Coalition and Senate crossbench politicians have discovered that they have a problem, they have self-referred. They have come forward as, for example, Senator Fiona Nash did, or Former Senator Xenophon did, and all the others did. They have admitted to the problem and they have taken the appropriate course.

No Labor politician so far has taken the appropriate course. We would hope that if it appears on reflection, on careful study by the Labor Party, that Senator Gallagher is in the same position as those who have been referred, they would agree to her referral. But let us consider and study carefully the material that she has put on the register and a decision will be made very soon.

PRIME MINISTER: But just consider this; consider the outrage and indignation of Bill Shorten as he demanded that Australian senators and MPs who - without any knowledge on their part - were dual citizens “must go” and “must go to the High Court”.

“Out they go,” said patriotic Bill, but now he has Senator Dastyari, who sold out Australia's national security to a foreign power. He’s admitted to it, it’s clear. He took the money, he read the talking points and what does Bill Shorten do? He’s backing him every inch of the way.

Do you know why? Because his job depends on Sam Dastyari.

But I’ll tell you what Bill Shorten is doing is abandoning Australia’s interest.

An Australian Prime Minister and anyone who wants to be an Australian Prime Minister should stand up for Australia. Bill Shorten has failed to stand up for our nation.

Thank you very much.