November 10, 2022
PATRICIA KARVELAS: Shadow Minister for Cyber Security, James Paterson joined me a short time ago.
JAMES PATERSON: Good morning.
KARVELAS: The Home Affairs Minister says the government is putting in place protections around government data and also supporting state police. Is that enough?
PATERSON: I welcome that. That's very appropriate and very important. My number one focus today is Medibank customers who will be very distressed by the news that their data appears to be leaked on the web by the hackers, they've made good on their threat unfortunately, and this is the worst-case scenario. It's important the government does that, there are other things the government will need to contemplate in the coming days and weeks. For example, as we saw in the Optus
case with a government-issued identification like Medicare numbers need to be reissued. If that's the case, that should be done free, and it should be done promptly.
KARVELAS: A privacy amendment increasing the penalties could see a company paying around $50 million for serious or repeated privacy breaches. Will that encourage companies to invest more in cyber security?
PATERSON: I think that, in conjunction with just having seen what Optus and Medibank have been through, will be encouraging any company to take this seriously. If after Optus and Medibank they're not taking it seriously, they need their heads read. There are other reforms I think the Parliament also needs to contemplate. Before estimates this week, I discussed with the Director-General of the Australian Signals Directorate, Rachel Noble, whether or not some kind of safe harbour is needed so that in a crisis companies have confidence that they can share information with ASD to help deal with the threat in the immediate aftermath of an attack before they have to start worrying about legal ramifications from the Privacy Commissioner and others. And Rachel Noble was very supportive of that idea. It's an idea that's been put to me by industry because they say they are anxious that the companies will think twice about whether they should cooperate to defeat the threat because they're worried about those legal ramifications and those fines. And if that is the case, that's very unproductive and it will stall an effective response to these crises.
KARVELAS: It's understood Russian-linked criminals are behind some of this Medibank hack. Is the dynamic between individual or independent criminals and state actors changing? Are we seeing more state-based interference?
PATERSON: It's not yet confirmed that it is Russian hackers, but I wouldn't be surprised if it turned out to be the case. It certainly has some indications and hallmarks of a Russian-based ransomware gang. It does appear, on the face of it, to be criminal in nature at this time. But it is certainly true that there is a convergence between online criminals and nation states. It's been revealed in previous attacks, for example, the Microsoft Exchange compromise in recent years that China state-backed entities were involved in that hack and in propagating the vulnerabilities and making that a far worse attack on the world. And our government, along with other governments, has attributed that to Chinese-based actors, which is an important part of calling out this malign behaviour online.
KARVELAS: As the number of cyber attacks increase – I don't think I have to convince anyone, you just look at the rolling headlines every day – what should we be doing to ward off state actors and prevent foreign interference?
PATERSON: Look, as you say, it's self-evident, but it is also backed by data. The Australian Cyber Security Centre put out a report on Friday which showed that in empirical terms. There's many things that we need to be doing. I think the most important is we have to demonstrate that there's a cost for this activity. So, one thing which we have done in the past is to attribute it because a lot of nation states are uncomfortable being called out on it, China included in that. We also need to make use of the sanctions within the Magnitsky regime, which we legislated a couple of years ago, which now allows the Australian government to sanction people for malign cyber behaviour, that's never been used. It should be used because I think that will have a powerful disincentive.
KARVELAS: I just want to move to another issue. The Defence Department is investigating reports China has approached former defence personnel from Western countries, including Australia, and is now looking at the policies that apply to former personnel, especially those who know national secrets. Obviously, that's part of the job. Your colleague Andrew Hastie says he knows of people who have been approached. How much of a concern is this?
PATERSON: It's a very great concern. It is very troubling news. It is already unlawful for former defence personnel to share the secrets that they gleaned from their time in service. And it is deeply worrying that some don't appear to either understand or care about those obligations. The Opposition has said for a number of weeks now that if the government wants to bring legislative change to address this, we would be very supportive of doing so. I'm grateful that the government has offered a briefing to us which we'll be taking up so we can have better understanding of the picture that they're seeing. But from what we know that's on the public record. It is a big problem, and it needs to be dealt with.
KARVELAS: Okay. It's already illegal. How much more can it be strengthened? How much clearer could it be?
PATERSON: That's one of the open questions in my mind, Patricia. We had defence officials before the Senate yesterday who said that this is something that is well
understood in their view, in the service, and that it is something that is repeatedly told to service members during their careers and before they retire. Now, if that is the case, it is really perplexing why some Australians think it's appropriate to do this. Even if it wasn't illegal, I think that most Australians should understand that it is not very patriotic to be helping to train the forces of a potential adversary nation.
KARVELAS: Are you aware of whether there are any Australian personnel that have been approached?
PATERSON: I'm not aware, but reading between the lines based on the Deputy Prime Minister's press conference yesterday, he seemed to indicate that was likely and officials again before the Senate yesterday confirmed that ASIO, the Australian Federal Police, are investigating. So, I assume there is good reason for them to be doing so.
KARVELAS: Meanwhile, the Foreign Minister Penny Wong has spoken with her counterpart. Your party leader Peter Dutton also met with the Chinese ambassador, which I think is pretty significant given some of the language we've heard from Peter Dutton in the past for this meeting to have happened. Does it show China is resuming engagement with Australia? What's happening?
PATERSON: I certainly welcome the re-engagement of the Chinese government with the Australian government. We thought it was very unproductive when, in the previous parliament, under the previous government they were unwilling to meet with their counterparts. Even when countries have very deep disagreements, as we clearly do with China, it's still important to have bilateral communication open, particularly at the ministerial and leader level. So, if it's the case that Anthony Albanese secures a meeting with President Xi in the coming weeks, that would also be welcome. We want the Chinese government to understand our perspective and it is more difficult if those meetings aren't taking place. So, I welcome it. It is appropriate. It's also critical that it doesn't come at the expense of any Australian policies. And so far, it seems very clear that the government, this government, intends to uphold the policies of the previous government and that's also welcome.
KARVELAS: Okay. What do you know of this meeting that Peter Dutton had with the Chinese ambassador? Why did it happen?
PATERSON: Well, Peter Dutton has always been willing to meet with his counterparts when he was in government and I'm not surprised he's also willing to meet with the ambassador here given that the request for the meeting was made. I understand it was a respectful but robust exchange and that many issues in the bilateral relationship, including human rights issues, trade sanctions and national security concerns were discussed, and that's appropriate. I'm glad that Peter had the opportunity to voice those concerns directly to the Chinese government.
KARVELAS: For the meeting with President Xi to be successful. If it does, go ahead. What do you think Anthony Albanese needs to do?
PATERSON: I'm a little bit reluctant to provide public advice to the Prime Minister, but consistent with past practice, I hope that issues of human rights, including Yang Hengjun and Cheng Lei, the two Australians who continue to be detained unjustly in China, are raised. I hope that the trade sanctions are raised and the whole range of issues in the bilateral relationship. It is an important opportunity.
KARVELAS: Thanks so much for joining us.
PATERSON: Thank you, Patricia.
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