March 21, 2025
The federal government has promised to plough another $45 million into Australia's spy agencies after releasing a long-awaited independent review of the nation's intelligence capabilities.
The government's move to make an unclassified version of the document public has been welcomed by analysts and former senior officials, who had feared Labor might go to the election before releasing it.
The review — which was conducted by former top officials Heather Smith and Richard Maude — paints a stark picture of the strategic threats confronting Australia.
It said China is emerging as a "more powerful, assertive and authoritarian actor" and intelligence agencies are already grappling with "the rapid rise of economic security as a policy priority, advances in information and other technologies, high levels of cyber attacks and foreign interference, threats to social cohesion, record levels of global warming, and a coronavirus pandemic".
The report found that Australia's intelligence agencies are "highly capable and performing well" and it doesn't recommend any sweeping changes to Australia's intelligence community, unlike the 2017 review, which triggered a significant restructure.
But it still made dozens of recommendations to improve operations, saying there needs to be "stronger and deeper integration" between agencies, "stronger central coordination of national security policy matters" and that the Office of National Intelligence should bolster its analytic capabilities.
As part of that it wants intelligence agencies to submit at least two major national assessments every year, as well as hold "regular exercises … to test and improve preparedness for regional crises or conflicts".
The review also said agencies needed to overhaul the "architecture for economic security policy making", sending intelligence analysts into Treasury to help it coordinate the government's response to stark challenges — including economic coercion and the weaponisation of trade.
The government said it's committed another $44.6 million over four years to implement the key recommendations, with Treasurer Jim Chalmers saying national security and economic policy had become "more and more intertwined".
"They've always been intertwined to some extent, but they're now almost inseparable from each other, and that's because so much of the uncertainty and risk that we see in the world, the geopolitical uncertainty, has an element of economic consequences attached to it as well," he said.
The report also pressed the government to finalise its work overhauling laws on electronic surveillance powers, saying the need for reform was "becoming more urgent".
And it flags the laws need to be "amended urgently" to help spy agencies access computer warrants and the data of "Australians working for a broader range of companies that are acting on behalf of a foreign government".
The government has been working on electronic surveillance reforms since taking office, with officials telling Senate estimates last year they were "working to finalise" the new laws "as quickly as possible".
Shadow Home Affairs Minister James Paterson said the reforms were "critical to make sure our law enforcement and intelligence agencies have the powers they need to counter terrorism and counter foreign interference and espionage".
"Despite promising to move on this almost three years ago, the Albanese government has failed to act," he said.
"In a dangerous security environment this is a dereliction of duty. Labor must urgently release their draft legislation as they have repeatedly promised to do."
Former Australian security official Chris Taylor praised the review, saying it "captures the full breath of the complex challenges facing Australian intelligence" and contained a vision to "turn Australia's national intelligence capability into national power".
Mr Taylor also said he was glad the prime minister released an unclassified version of the report, saying it kept a level of transparency which governments have maintained since the landmark 2004 Flood Report.
"The sophistication of the analysis and the ambition of its recommendations — and the insight gained for the public into what the national intelligence community does for the national interest in their name — proves the importance of this long-standing approach to intelligence review," he said.