New foreign interference laws will compound risks to whistleblowers and journalists


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Increasingly, the language of ‘national security’ is invoked to protect a government’s broader interests.
AAP/Mick Tsikas

Keiran Hardy, Griffith University

The Turnbull government has announced a crackdown on foreign interference in Australian politics and national security. Proposed laws include a ban on foreign political donations, new criminal offences, and a transparency register for those acting on behalf of foreign governments or organisations.

Prime Minister Malcolm Turnbull carefully emphasised that the proposals are not focused on China’s influence in Australia. But, as the Lowy Institute’s Euan Graham put it, there’s an “800-pound panda” in the room.

The proposed criminal offences will significantly expand the scope of existing laws against espionage and treason. This will make it easier to prosecute spies and other foreign nationals who seek undue influence over Australian business or politics.

However, the new laws pose risks to whistleblowers and journalists. They suggest the concept of “national security” is continually expanding.


Further reading: Ban on foreign political donations is both too broad and too narrow, and won’t fix our system


Espionage

The Criminal Code currently sets out an offence of espionage that is punishable by 25 years’ imprisonment.

The main offence applies where someone communicates or makes available information that concerns Australia’s security or defence. The person must intend to prejudice Australia’s security or defence, or advantage another country’s security or defence. Under the proposed changes, this offence will attract a maximum penalty of life imprisonment.

Where a person recklessly endangers Australia’s security or defence, this will be punishable by the current penalty.

The new espionage offences will apply to possessing or receiving information, in addition to communicating it. They will protect a broader range of information, including unclassified material.

Other new offences, punishable by 15 years’ imprisonment, will target preparation for espionage and the theft of trade secrets.

Foreign interference

Proposed offences for foreign interference will target conduct not ordinarily considered to be espionage or treason.

Currently, the federal offence of treason describes very rare and serious conduct, such as assassinating or capturing the Queen or prime minister.

These new offences will target covert, deceptive or undisclosed conduct that is directed, funded, supervised or undertaken on behalf of a foreign interest. The penalties will range between ten and 20 years’ imprisonment.

To constitute foreign interference, the conduct must be intended to:

  • serve the intelligence purposes of a foreign actor

  • harm Australia’s national security

  • influence the exercise or performance of a democratic or political right, or

  • influence a government or political process.

Other new offences will target the support or funding of foreign intelligence agencies. These will be similar to existing crimes for supporting or funding terrorist organisations.

Are the new offences needed?

The changes will make it easier to prosecute foreign nationals who intentionally interfere with Australia’s business, political or foreign policy interests.

Where such influence cannot strictly be described as impacting on security or defence, successful prosecution under the existing espionage or treason offences is very difficult.

The government’s other justifications are much weaker. The current espionage offences already extend beyond the communication of information to making, obtaining or copying sensitive records. The Crimes Act includes offences that are triggered when an Australian public official discloses official secrets or other information obtained in the course of their employment.

What are the risks?

The proposed offences will target some conduct that should clearly be a serious criminal offence, such as intentionally supporting a foreign intelligence agency.

However, the proposed laws go well beyond such clear cases to target a broad and vague range of conduct affecting Australian interests. This includes possessing unclassified information and any deceptive or undisclosed conduct that influences government processes.

Most importantly, the proposed changes pose risks to whistleblowers and Australian media organisations. These risks were compounded in 2014 by changes to national security legislation in response to the threat of foreign fighters.


Further reading: National security bills compound existing threats to media freedom


A journalist could face serious penalties under the proposed espionage offences for receiving information leaked by a government official or intelligence whistleblower, before they even decide to publish that information.

It seems the information need not even be classified for the penalties to apply, provided making the information available would benefit a foreign country or organisation.

The government needs to ensure that journalists publishing sensitive information in the public interest will not face criminal prosecution for espionage or other federal criminal offences. This should be done by drafting legal protections for journalists who act in a professional capacity in the public interest.

Assurances from Attorney-General George Brandis that journalists will not be prosecuted for doing their job are not enough.

The proposed laws should be viewed not only as a response to increasing Chinese influence in Australia, but also as symptomatic of a post-Snowden crackdown, in which all potentially embarrassing information about government is closely protected.

Similar debates about expanded espionage offences and press freedom have already taken place in the UK. These debates confirm that “national security” is no longer simply about physical threats like terrorism or traditional forms of spying.

The ConversationIncreasingly, the language of national security is invoked to protect a government’s broader interests – political, business and economic.

Keiran Hardy, Lecturer, School of Criminology and Criminal Justice and Member, Griffith Criminology Institute, Griffith University

This article was originally published on The Conversation. Read the original article.

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Nationals elect Bridget McKenzie as new deputy



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Bridget McKenzie beat several other candidates in the race for the Nationals’ deputy leadership.
AAP/Lukas Coch

Michelle Grattan, University of Canberra

The Nationals have elected Victorian senator Bridget McKenzie as deputy leader to replace Fiona Nash, who was disqualified from parliament by the High Court.

The win will propel McKenzie, 47, from the backbench into the cabinet when Malcolm Turnbull announces a ministerial reshuffle after the December 16 Bennelong byelection.

Promoted by cabinet minister Darren Chester, also from Victoria, McKenzie beat several other candidates, including Resources Minister Matt Canavan, a cabinet member.

This is the second consecutive time the party has chosen a female senator as deputy leader.

The Nationals have had five spots in cabinet and there has been some talk about whether the loss of Nash from the party’s parliamentary numbers will affect their entitlement, which is based on an arithmetic formula.

But Nationals sources say the arithmetic can be cut more than one way, depending on what date is used for comparison, and also that Malcolm Turnbull and Barnaby Joyce will not want to disturb the Coalition relationship.

Joyce’s strong win in the New England byelection on Saturday provided Turnbull with a fillip going into the final week of parliament. Joyce was sworn back into parliament on Wednesday and his vote ensured Labor failed to be able to refer a “job lot” of MPs, including four Liberals, to the High Court.

The euphoria surrounding the byelection win has soothed some Coalition tensions, including over the rebel Nationals forcing the government’s hand last week to set up a royal commission into the banks.

Much interest in the coming reshuffle will centre on George Brandis. After months of speculation that Brandis would leave parliament, the attorney-general, who has recently performed well after earlier political missteps, said this week he intended to stay.

It earlier had been an open secret that Turnbull saw the likely departure of Brandis as an opportunity to elevate Mathias Cormann, now deputy Senate leader and a conservative ally of Turnbull, to Brandis’ position of Senate leader.

The ConversationBrandis has recently been active in asserting the positions of the Liberal moderates; he has been a vocal backer of the same-sex marriage legislation, which is set to pass on Thursday.

https://www.podbean.com/media/player/xac9s-7e77c6?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

Will Mnangagwa usher in a new democracy? The view from Zimbabwe



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Emmerson Mnangagwa, President-elect of Zimbabwe.
Filckr/UN

Nic Cheeseman, University of Birmingham

Zimbabwe has a new leader. Robert Mugabe is out. His former ally turned rival, Emmerson Mnangagwa, is in. What now?

After ecstatic celebrations to mark Mugabe’s resignation thoughts have began to turn to what comes next. Mugabe may have exited the political scene, but it remains dominated by the same political party – Zanu-PF – that sustained his rule.

Moreover, the country’s president-elect, Emmerson Mnangagwa, is hardly a breath of fresh air. Having held a series of cabinet positions under Mugabe, and served as first vice president between December 2014 and his sacking in November 2017, he looks more like a force for continuity than change.

As a result, talk in Harare quickly turned to what kind of leader Mnangagwa will be, and the system of government that would best serve ordinary Zimbabweans.

The fork in the road

My conversations with people on the streets of the capital, Harare, about the political system the country needs suggests that two distinct camps are emerging: those who want elections to be held as soon as possible, and those who say the polls should be postponed and a transitional government established.

Both of these options have genuine “pros” but also strong “cons”. As is so often the case, there is no perfect answer that solves all problems.

It is understandable that many Zimbabweans want a period of calm and orderly government after the twists and turns of recent weeks, and believe that it would be better to form an inclusive government that would feature representatives of all of the main political parties – a kind of power sharing in all but name.

Even though I have consistently argued in favour of the value of democracy and elections in Africa, I have to admit that the “transitioners” have some viable arguments.

The most obvious is that a period of stability and more consensual government might facilitate much needed reform of the economy and also the wider political and legal system. After all, rival parties are unlikely to come to agreement on these issues if they are immediately thrust into an election campaign.

The “transitioners” also have a point when it comes to democracy. Few people in Zimbabwe believe that it’s possible for elections to be free and fair if they are held between July and August next year, as currently scheduled. Given this, and the current divisions within the opposition, a rush to elections is likely to result in a convincing victory for Zanu-PF under problematic circumstances.

A transitional arrangement would allow for much needed electoral reforms to be put in place, creating the potential for a better quality process and a more consensual outcome later on.

Testing the Crocodile

But there is also another camp that wants to see Mnangagwa, popularly known as The Crocodile, to face an election as soon as possible.

Just like their counterparts in the “transitioner” camp, “electioneers”, have some strong arguments. Whatever one wants to call Mnangagwa’s rise to power – from a coup to an internal party squabble – it is clear that it has not been a high quality democratic transition. And while it is clear that the overthrow of Mugabe was hugely popular, we don’t know if the same applies to a Mnangagwa presidency. An election would settle that question.

It would also give the new government a popular mandate to undertake economic reforms, whoever wins power. This could be important to the success of the reform project, because things are likely to get worse before they get better, and the country’s economic medicine may prove to be a bitter pill to swallow.

Holding elections would also do one thing that postponing them will not; it will test the commitment of the new government to democratic norms and values from the get-go. One of the main reasons that Zimbabwean elections have been poor quality is that Zanu-PF and the military have intervened to make sure this was the case. As another friend put it, “If they are really committed to doing the right thing, they can do it right away and the elections will not be too bad”.

Learning from the past

“Electioneers” are also motivated by scepticism that an inclusive transitional government would get much done. Both Zimbabwe and Kenya have had power-sharing governments in the recent past, and while they both introduced new constitutions they also saw high levels of corruption and limited security sector reform. They also both led to elections that were denounced by opposition parties as being unfree and unfair.

It’s fair to ask: why would it be different this time?

The question is particularly pertinent given the current composition of parliament. Because Morgan Tsvangirai’s Movement for Democratic Change boycotted a series of by-elections on the basis that they would not be free and fair, it has lost many of the seats it won in 2013. As a result, any transitional arrangement that deferred elections and “froze” the current parliament for the next three years would have a big legislative advantage to Zanu-PF.

It is also important to keep in mind that economics cannot be divorced from politics: Zimbabwe’s current economic difficulties stem precisely from an unaccountable political framework that ignored the interests of the people. Given that recent events have emboldened the military and given them an even stronger voice within government, this is a pressing concern.

Deferring electoral reforms in order to focus on economic recovery may therefore prove to be a self defeating strategy.

Next steps

Ultimately, the form of government that evolves in Zimbabwe will not be a product of popular dialogue. One of the distinctive features of this process is that for the most part it has been conducted behind closed doors by a small elite.

Don’t be fooled by the pictures of tens of thousands of people marching on Saturday – all sides have invoked popular support, but none have actually encouraged ordinary people to say what they want, or given them a seat at the table. This is a worrying sign if strengthening democracy is the long-term goal.

Recent public statements by the main parties at the time of going to press suggests that they are not converging on an interim administration, and so the “electioneers” may get their wish. That could still change because talks are ongoing and both sides would gain something from a delay. But if it doesn’t the people will be able to have their say on how they want their country to be run.

The ConversationOf course, voting will not actually equate to “having a say” unless the country’s new leader follows through on his promise to build a “new democracy”, and the ruling party can kick the habit of a lifetime. Watch this space.

Nic Cheeseman, Professor of Democracy, University of Birmingham

This article was originally published on The Conversation. Read the original article.

‘Finkel’s new energy report’ isn’t new and it isn’t by Finkel


David Blowers, Grattan Institute

The headline almost writes itself: “Finkel backs Labor’s renewables policy”. A report released yesterday, The role of energy storage in Australia’s future energy supply mix, has found that Australia can reach 50% renewables by 2030 with limited impact on reliability.

It has, inevitably, lead to claims that Labor’s target of 50% renewables by 2030 is both achievable and correct. But focusing on the politics would be missing the point.


Read more: Shorten goes on front foot over 50% renewables ‘target’


It should first be noted that, despite the many headlines citing his involvement, Australia’s Chief Scientist Alan Finkel did not actually write the report. The report is by the Australian Council of Learned Academies (ACOLA), an independent, not-for-profit organisation that brings together Australian academics to provide evidence-based solutions to national and global policy problems. Yes, funding was provided by the Office of the Chief Scientist, and yes, Finkel himself has been supportive of the report, but describing it as a “new Finkel report” is stretching things a little.

The report explores how much energy storage – whether in batteries, pumped hydro or solar thermal – we will need as we increasingly rely on renewable, and therefore intermittent, electricity generation. As more renewable generation enters the system, there needs to be alternative sources of generation, such as storage, that can meet demand when the sun isn’t shining or the wind isn’t blowing.


Read more: Want energy storage? Here are 22,000 sites for pumped hydro across Australia


The ACOLA report finds that only a small amount of storage would be required to balance a system with 50% renewables. Cue the political debate about the quality of the electricity market modelling that ACOLA relied on to make this finding.

There is far too much focus on electricity market modelling in Australia these days – particularly regarding renewable energy. Finkel’s policies are distrusted and dismissed by people on one side of the debate because they believe his modelling shows too high a level of renewables. And the Coalition’s National Energy Guarantee (NEG) is distrusted and dismissed by people on the other side of the debate because they say it shows too low a level of renewables.

This debate rages on even though no modelling has been revealed; the federal government has promised to unveil the modelling behind the NEG at a meeting of the COAG Energy Council this Friday.

The truth is, modelling is an inexact science. The outcomes depend on the assumptions you use and the data you shove in. This is why the results for Finkel and the NEG will differ so much, despite them using the same emissions reduction targets and using emissions reduction mechanisms that impact the market in very similar ways.


Read more: Politics podcast: Energy Security Board chair Kerry Schott on a national energy plan


As it happens, I have limited confidence that you need only a little storage with 50% renewables but a lot of storage at 75% renewables, as ACOLA’s report claims. But the specifics are not important. What is important is that Australia will need something to balance intermittent renewables – and at some point, we will need quite a lot of balancing.

The most important aspect of the ACOLA report is that it brings into focus an unavoidable fact: Australia has serious problems with its electricity system. System security – making sure that the system doesn’t break – is an immediate concern. Reliability – ensuring the system has enough power to meet demand – is a growing problem. And energy storage is a potential solution to both.

ACOLA is not the first to point this out. Finkel’s blueprint for the National Electricity Market, released in June, identified these concerns. The Australian Energy Market Operator in September identified the need for a new mechanism to address medium-term reliability issues in the market.

Without the right policy settings to address reliability and security concerns, storage will have no chance of helping to fix our energy mess, regardless of the quality of ALOCA’s modelling.

The ConversationOur politicians need to focus on the substance of this debate, rather than the headlines. Hitting each other over the head because there are too many – or too few – renewables in the policy basket is pointless and will ultimately prove self-defeating. Instead, how about finding an actual policy solution? Starting at this Friday’s COAG Energy Council meeting. Please?

David Blowers, Energy Fellow, Grattan Institute

This article was originally published on The Conversation. Read the original article.

Australia’s tenuous place in the new global economy


Richard Holden, UNSW

The Committee for Economic Development of Australia (CEDA) has released a report titled Australia’s Place in the World, which considered how Australia should respond to changing attitudes to globalisation.

At home and around the world, there is a backlash against free trade and globalisation. The report asks what course Australia should navigate through these choppy economic and political waters.

The backdrop, of course, is the UK Brexit vote and the election of Donald Trump as US President.

If that’s not motivation enough, one could easily add to CEDA’s list: the performance of Marine Le Pen in France’s recent presidential election, the election of the far-right AfD to the German parliament, and the looming role of Pauline Hanson’s One Nation in the Queensland election.

Tariffs and trade

The report is broken into three sections: Global Economy, Global Security, and Global Governance, but it is the first and third that speak directly to Australia’s economic fortunes in the age of Trump.

One obvious, but correct and important observation the report makes is that Australia has been a huge beneficiary of free trade over the past 30 years. Not only have our exporters gained access to major overseas markets, but consumers in Australia have also benefited from reduced tariffs.


Read more: With a free trade deal Australia can win China’s dairy market


For example, the price of a typical sedan has basically halved in real terms due to the removal of a 100% car tariff. But while trade and globalisation have made the economic pie bigger, the sharing of those benefits has been much more uneven. Just ask manufacturing workers.

What is missing from the report’s recommendations is how to deal with and compensate the losers from globalisation in Australia. That is important, both economically and politically.

Global rise of populism

The rise of populist parties around the world has been associated with this failure to compensate globalisation’s losers.

Part of what it takes to address this issue is so-called “place-based policies” which Rosalind Dixon and I have previously discussed. Broadly, this refers to the people who are affected when industries move away from particular areas and employment opportunities dry up.

The CEDA report argues, however, that:

Policies such as moving from transaction taxes on property to broad-based land tax to address housing affordability and labour mobility need to be designed along with transition pathways. GST reform with a broader base to remove the need for stamp duty could be another option.

The report also points out that Australia’s company tax rate is uncompetitive, and that the proposed shift to a 25% rate under the Coalitition’s “Enterprise Tax Plan” would only happen by 2026-27, if it happens at all. These are all good points, and would make for good policy. Yet the only one that looks vaguely likely to happen is replacing stamp duty with land tax – and that would be done at a state government level.


Read more: Lessons from Brexit: the fruits of globalisation must be shared with low- and middle-income groups


The federal government floated the idea of GST reform and retreated almost immediately after the opposition predictably attacked it viciously and effectively as being “regressive”. The Enterprise Tax plan also looks to be in danger, as several crossbench MPs seem likely to side with Labor and want tax cuts only for small businesses. That’s utterly stupid economics, but apparently good politics.

Middle power leadership?

As the report notes: “Global cooperation is growing increasingly important in a world that faces a number of crises that require cross-border solutions.”

This is surely true, although the report paints a rosy picture of Australia’s potential role as a “middle power”, claiming that we were important in the establishment of the United Nations.

True, Australia played a relatively important role in establishing APEC and the G20. But that involved leadership from figures like Hawke, Keating and Rudd. I, for one, don’t see anyone on the present political landscape with those leadership and persuasion skills.

Perhaps the bigger challenge is that President Trump seems determined to radically undermine international institutions. Even Canadian Prime Minister Justin Trudeau was unhelpful in the Trans Pacific Partnership rebound effort that Malcolm Turnbull and others were trying to arrange.

What can Australia do in the face of orchestrated attacks on global institutions by the biggest and most important nations? Very little, I fear. The age of Trump is a difficult time for Australia and its leaders. Many things are out of our control.

What we can do, however, is resist the tide of populism at home, and provide stable and functional government. Both major parties have a patchy recent record in that regard, and the federal opposition has made some populist-type moves on trade and protectionism.

The ConversationLet’s hope they don’t really believe it.

Richard Holden, Professor of Economics and PLuS Alliance Fellow, UNSW

This article was originally published on The Conversation. Read the original article.

Xi Jinping unveils China’s new leadership team


Hans Hendrischke, University of Sydney

China’s 19th Party Congress has elected a new leadership team that promises to bring continuity in the country’s gradual domestic reform and stronger focus on internationalism.

Proving many political observers wrong, the new leadership line-up is an A-team in terms of economic and international credentials.

New leadership team

President Xi’s “new era” of Chinese development and economic growth is defined by the reform agenda he laid out when he came to power in 2012. This vision was most clearly articulated in his personal comments on the 60-point policy document that laid out the President’s vision for the governance reform of China.


Read More: China’s ambition burns bright – with Xi Jinping firmly in charge


The newly elected leadership team comprises five new members, all of whom bring economic and international experience to the table that will shape the direction of Chinese policies over the next five years.

Wang Yang and Han Zheng have led China’s most successful and most internationalised province-level economies, Guangdong and Shanghai. Li Zhanshu and Zhao Leji have overseen growth and reform in China’s inland provinces before assuming central party posts. Wang Huning, the chief theoretician, speaks fluent French and has a PhD in philosophy from Johns Hopkins University.

All five newly elected members (they join the existing Premier Li Keqiang) have been groomed for the top positions by serving at least one term on the politburo. The composition of the seven-member standing committee of the politburo is evenly balanced between economic reformers and the political power base.

Premier Li Keqiang’s focus is on economic policy-making, while Wang Yang and Han Zheng have steered China’s most open economies. Together, they represent economic stability and continued globalisation. The other three new members will oversee continuity in domestic policies and the continued role of the party.

Li Zhanshu was in charge of party administration over the past five years and is seen in the role of the party “whip”. Zhao Leji, as a power broker, was running the party’s Organisation Department and served as the second in command for the Party’s discipline inspection system in charge of anti-corruption policies. Wang Huning, who formulates Xi Jinping’s political agenda, has served the previous two leadership groups in exactly the same role.

Together, these six closest associates of Xi Jinping demonstrate the continuity of policies from the first half of Xi Jinping’s five-year term into this second five-year term to a domestic as well as an international audience.

Renewed focus on internationalism

One of the key advantages of the new leadership team will be their solid international credentials.

Wang Yang, former Party secretary of Guangdong Province, has been closely involved in China’s strategic economic dialogue with the United States. At the same time, he was in charge of the internal steering committee for the Belt and Road Initiative. His appointment means that China will continue the balancing act between its own regionally focused strategy and the (western) rules-driven form of globalisation.

Han Zheng, the former Party Secretary and mayor of Shanghai, served during the 2010 Shanghai World Expo and oversaw the globalisation of Shanghai with its co-existence between commercially viable state-owned enterprise sector and a growing private sector.

Moving these internationally connected decision-makers to the front line signals pragmatism in China’s economic policies and globalisation. Their experience in dealing with foreign governments and businesses, and their awareness of the interdependence of global markets, suggests that current reforms in financial industries, advanced manufacturing and overseas investment will continue.

A new leadership direction

President Xi’s governance reform is a driver behind his anti-corruption campaign that has been in place for five years. In western terminology, Xi’s contribution to socialist theory is his attempt to institute a “separation of powers” by strengthening the role of the legislative in supervising the executive.

Currently, the party has direct control over the executive through appointments of all relevant government officials and direct interference in detailed government processes. Xi Jinping’s governance reform envisages a rules-based supervision of government through the system of people’s congresses and less direct interference by the party.


Read More: Video explainer: at China’s 19th National Party Congress, Xi’s vision and legacy are at stake


The governance reform includes practical aspects, such as reform of public finance as a precondition for banking reform; further tax reform, social security and medicare reform. These reforms will open new markets and are relevant for foreign economic cooperation.

Xi’s speech to the Party Congress cited unresolved issues, including social inequality, poverty, environmental pollution, health care and food safety. These are urgent matters than affect general public support for his policies and the government.

In view of the urgent need for progress in these areas, he foreshadowed a stronger role of the market and international cooperation in areas such as health care and social services.

Implications for Australia

For Australia, continuity in China’s leadership transition means stability in long-term economic relations, from forthcoming revisions to ChAFTA to Australian involvement in China’s “One Belt, One Road” Initiative.

The ConversationThe new leadership will continue to promote regional economic integration. Australia, with its location between Southeast Asia and the Pacific, is recognised by China as an important economic hub with mature institutions that will underpin regional economic cooperation.

Hans Hendrischke, Professor of Chinese Business and Management, University of Sydney

This article was originally published on The Conversation. Read the original article.

The government’s new gas deal will ease the squeeze, but dodges the price issue



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The government has so far refrained from putting a legal limit on LNG leaving our shores.
Ken Hodges/Wikimedia Commons, CC BY

Samantha Hepburn, Deakin University

The deal signed this week by the federal government and the nation’s biggest three gas producers will ease Australia’s gas supply squeeze, but it will do nothing to address the current high prices.

Under the contract, Shell, Origin and Santos have agreed to supply more domestic gas to avert the predicted shortfall for 2018.

In so doing, the government seemingly sidestepped the need to trigger its own powers to forcibly restrict gas exports.

Sighs of relief all round, then. But here’s the thing: neither the new deal, nor the legislation that governs export controls, actually addresses the issue that is arguably most important to consumers – the high prices Australians are paying for their gas.


Read more: To avoid crisis, the gas market needs a steady steer, not an emergency swerve


Australia has vast gas resources, and yet somehow we find ourselves with rising prices and a forecast shortfall of up to one-sixth of demand in the east coast gas market in 2018.

This is partly understandable, given that rising global demand has fuelled a lucrative export market. The primary destination is Asia, which will assume more than 70% of global demand. In geographical terms this puts Australian exporters in a very strong position, and by 2019 Australia is forecast to supply 20% of the global market – up from 9% today.

However, the strong global demand for liquefied natural gas (LNG) does not in itself provide the full explanation for rising gas prices in Australia’s east coast gas market. This is caused by a weak regulatory environment.

Policy levers

The Australian Domestic Gas Security Mechanism, which took effect in July 2017, gives the federal resources minister the power to restrict exports of LNG in the event of a forecast shortfall for the domestic market in any given year.

This five-year provision was designed as a short-term measure to ensure domestic gas supply. If triggered, it would require LNG exporters either to limit their exports or to find new sources of gas to offset the impact on the domestic market.

To trigger the mechanism, the minister must follow three steps:

  1. formally declare that the forthcoming year has a domestic shortfall, by October 1 of the preceding year;

  2. consult relevant market bodies, government agencies, industry bodies and other stakeholders to determine their view on the existing and forecast market conditions; and

  3. make a determination by November 1 on whether to implement the measures.

Any export restriction implemented under the ADGSM would potentially apply to all LNG exports nationwide, including those from areas with no forecast gas shortage, such as Western Australia. The minister does have the ability to determine the type of export restriction that is imposed. An unlimited volume restriction does not impose a specific volumetric limitation and can be applied to LNG projects that are not connected to the market experiencing the shortfall. A limited volume restriction imposes specific limits on the amount of LNG that may be exported and may be applied to an LNG project that is connected to the market experiencing the shortfall.

Non-compliance with the export limits imposed on gas projects would have a range of potential consequences for gas companies. These include revocation of export licence, imposition of different conditions, or stricter transparency requirements.

The new deal

The agreement signed with the big three gas producers effectively relieves the government of the need to consider triggering the ADGSM. As such, 2018 has not been officially declared to be a domestic shortfall year.

But the agreement is not grounded upon any specific legislative provision. Therefore it is essentially only enforceable against the gas companies that are parties to it. And in accordance with the private terms and conditions that those companies agree to.

The broad agreement is that contractors will sell a minimum of 54 petajoules of gas into the east coast domestic market (the lower limit of the forecast shortfall) and keep more on standby in case the eventual shortfall turns out to be bigger.

But what about prices?

The deal contains no specific provision regarding domestic pricing. So, although there will be more gas in the domestic market, this does not necessarily mean that the current high prices will drop.

In the short term, the provision of additional supply may curtail dramatic increases in domestic gas prices. However, the gas deal does not address the core problem, which stems from our enormous commitment to LNG exports and the connection of domestic gas prices to the global energy market.

Indeed, the commitments are so great that many LNG operators have had to take conventional gas from South Australia and Victoria to fulfil their export contracts. This has put significant pressure on domestic prices.

The unequivocal truth is that gas prices were much cheaper before the LNG export boom. The only way to achieve some level of protection for domestic gas prices is to implement stronger regulatory controls on the export market. This should involve taking account of the public interest when assessing whether export restrictions should be imposed.

The ADGSM legislation does not incorporate any explicit public interest test, despite the fact that gas is a public resource in Australia and gas pricing is a strong public interest issue.

Compare that with the United States, where public interest is a key principle in assessing whether to approve any LNG exports to countries with no US free trade agreement (such as Japan). Public interest tests in the United States involve a careful determination of how exports will affect domestic supply and the potential impact that a strong export market will have upon domestic prices.


Read more: Want to boost the domestic gas industry? Put a price on carbon


The Australian government’s decision to broker a deal with gas suppliers, rather than extend the long arm of the law, means that regulators will need to keep a close eye on the gas companies to check that they are holding up their end of the bargain.

That job will fall to the Australian Competition and Consumer Commission (ACCC). ACCC chair Rod Simms this week warned gas suppliers to ensure that their “retail margins are appropriate”.

The ConversationIn the absence of any explicit rules compelling gas producers that signed the deal to provide clear and accurate information and adopt stronger transparency protocols, the ACCC may face a very onerous task.

Samantha Hepburn, Director of the Centre for Energy and Natural Resources Law, Deakin Law School, Deakin University

This article was originally published on The Conversation. Read the original article.

It may not be beautiful but the new ten dollar note is pretty secure


Tom Spurling, Swinburne University of Technology and David Solomon, University of Melbourne

You might notice a new blue and gold addition to your wallet in the next few weeks as the Reserve Bank of Australia releases the new A$10 note into circulation. The new series of Australian banknotes are not a designer’s dream but they are the strongest yet in terms of preventing counterfeiting.

The first of its kind polymer note was introduced by the Reserve Bank of Australia in July 1992. This A$5 banknote was arguably the most secure banknote in circulation anywhere in the world.

But in the intervening 25 years banknote security technology, for both polymer and paper banknotes, has improved and Australia’s first polymer notes were no longer world leading. These new notes take us back to being a world leader in this technology or at least equal to the new £10 “Jane Austin” banknote released recently by the Bank of England.


Read more: Our punk, jarring five dollar note: so bad it’s good or just bad?


The next new banknote to be released will be the A$50, planned for 2018 and the A$20 and A$100 in later years. The new A$50 banknote will be particularly important since, in 2016, nearly 84% of our counterfeit notes are of that denomination.

The rate of counterfeit notes is usually quoted as the number of counterfeits per million notes in circulation (ppm). Issuing authorities usually like the number to be under 50ppm.

Canada had the highest rate of counterfeiting before adopting the polymer note, it reached a peak of 470ppm in 2004 and stayed high until the release of their polymer banknotes in 2011. Their rate is now around 10ppm.

In contrast to this, the Australian rate rose to about 15ppm towards the end of the first decimal paper money series but dropped dramatically to 1 or 2ppm when the polymer notes were introduced. The rate rose to as high as 25ppm in 2015.

There are a number of reasons for this. Computing and printing equipment has become more sophisticated and cheaper. Quality printing on polymer is now possible with modern printing and copying equipment.

Also counterfeiters need only simulate a banknote, not reproduce it exactly, to fool us. In 2016 31,682 counterfeits were used before they were detected.

However not all fakes go unnoticed. For example, the “waxy” feeling of a A$10 banknote in 1966 failed to fool a milk bar owner in Ashburton and the forgers were apprehended within a few hours.



Reserve Bank of Australia/The Conversation

The new banknotes retain all of the security features of the first series of polymer banknotes, but with some new additions.

The A$10 note is still printed on the same polymer material, has a clear window and has micro-printed verses from the poems of Banjo Paterson and Mary Gilmore. All polymer banknotes internationally have these two features as neither can be reproduced on paper copying machines.

Both the new A$5 and A$10 banknotes include a top to bottom clear area with a number of devices that change colour when moved or when exposed to different light sources. These are called “optically variable devices”.

These are similar to the original 1988 A$10 commemorative banknote that had a diffraction grating, fine metal lines that when exposed to the light change colour, depicting Captain Cook. The devices in the new banknotes are like this but use more robust technology.

The new notes also have a tactile feature to assist vision impaired users. The A$5 note has one raised dot on the top left hand area and another on the bottom central area. The A$10 banknote has two raised dots. These first appeared on the Canadian polymer banknotes in 2011 and are also on the new Bank of England notes.

Another new feature on both the A$5 and A$10 banknotes is that the serial number and the year of printing fluoresce under UV light. This is quite common technology because its used in paper notes as well.

Polymer notes started in Australia

One of the reasons why the currency of other countries has become as secure as ours is the commercial and technical success of the company that produces the polymer substrate used in the notes.

In the early 1990s the Belgium chemical company, Union Chimique Belge (UCB) built a plant in Craigieburn, near Melbourne, to manufacture the polymer substrate for the new Australian banknotes. This was the first plant dedicated to producing polymer banknote substrate.

In 1996 the RBA and UCB established a joint venture, Securency International, to market the technology internationally. This venture was successful and the many countries in the Asia-Pacific region adopted the new technology.

Some of the success of the company was marred by illegal conduct, with the director of regional sales for Africa, Peter Chapman, jailed for bribery in the UK.

UCB sold its share of Securency to the UK company, Innovia Films, in 2004. In 2013, Innovia acquired the RBA’s 50% share in the business and renamed it Innovia Security.

The large Canadian packaging company, CCL Industries acquired Innovia Security in February 2017. It merged with the Banknote Corporation of America to form CCL Secure. By the end of 2017 this company will have produced more than 55 billion polymer notes in 80 denominations and and in 24 countries.

The ConversationThis latest series of Australian polymer banknotes will place us once again at the forefront of banknote security. But continuing research, development and new features will still be required to keep us there.

Tom Spurling, Professor of Innovation Studies, Swinburne University of Technology and David Solomon, Professorial Fellow in Engineering, University of Melbourne

This article was originally published on The Conversation. Read the original article.

Turnbull’s chief-of-staff is the new defence head


Michelle Grattan, University of Canberra

Malcolm Turnbull has appointed his chief-of-staff Greg Moriarty – who has a strong background in defence, foreign affairs and counter-terrorism – as the new secretary of the defence department.

Moriarty, who replaces the recently retired Dennis Richardson, worked in defence between 1986 and 1995, primarily in the Defence Intelligence Organisation.

He served in the headquarters of the US Central Command in the Persian Gulf during Operations Desert Shield and Desert Storm.

While in the foreign affairs department Moriarty was senior negotiator with the Peace Monitoring Group on Bougainville, ambassador to Iran, ambassador to Indonesia, and a deputy secretary.

When he was ambassador to Iran he gave two lengthy briefings to George W. Bush, in 2006 and 2007, at the Americans’ request.

In 2015 he became the first Commonwealth counter-terrorism co-ordinator. He joined Malcolm Turnbull’s office in August 2016 as adviser on international and national security, before becoming chief-of-staff.

He is described as having a good policy mind and being very steady under pressure. He is said to have been well regarded by Labor’s Stephen Smith when Smith was foreign minister.

Moriarty’s name emerged publicly quite late in the speculation about Richardson’s replacement. The field also included Mike Pezzullo, who heads immigration and border protection, and Peter Jennings, director of the Australian Strategic Policy Institute.

Presumably Pezzullo will now remain to head Peter Dutton’s new home affairs department, the core of which is the current immigration department.

Turnbull’s new chief-of-staff will be Peter Woolcott, currently high commissioner to New Zealand.

The ConversationWoolcott has previously served as ambassador for the environment, where he dealt with international climate change issues, permanent representative to the UN in Geneva and ambassador for disarmament, ambassador for people-smuggling issues, and ambassador to Italy. Between 2002 and 2004 he was chief-of-staff to the then foreign minister, Alexander Downer.

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Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.

New Home Affairs department should prompt review of Australia’s human rights performance



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AAP/Lukas Coch

Amy Maguire, University of Newcastle

Prime Minister Malcolm Turnbull has just announced the creation of a new “super-ministry”, modelled on the UK Home Office. By the end of 2018, Australia will have a new Department of Home Affairs.

This change consolidates responsibility for all security agencies within a single portfolio. Peter Dutton, currently immigration minister, will head the proposed department.

Dutton gains responsibility for the Australian Federal Police from Justice Minister Michael Keenan. He also adds responsibility for ASIO, previously under the portfolio of Attorney-General George Brandis. As home affairs minister, Dutton will retain responsibility for immigration and border protection.

Announcing the change, Turnbull and Brandis went to considerable effort to note the attorney-general’s continued significance, despite his loss of responsibility for intelligence. Both emphasised that the attorney-general would gain responsibility for some oversight bodies previously within the prime minister’s portfolio.

According to Turnbull, the new arrangements will ensure stronger oversight of security matters to balance protection for civil liberties and freedoms.

What does this reform mean for people subject to Australia’s immigration system?

The comments of the four ministers at today’s press conference were revealing in many ways.

One group of people – refugees and asylum seekers – were completely absent from the ministers’ remarks. This raises questions regarding the meaning of the changes for these particularly vulnerable people, who remain subject to the powers of the home affairs minister.

Brandis said the reforms are significant because, for the first time, a senior cabinet minister will have as his exclusive focus the national security of Australia. That is, the home affairs minister’s sole focus will be national security and border security.

Dutton, preparing to assume wide-ranging new powers, reflected on his ministry’s success in stopping and turning back boats. According to Dutton, without integrity in the immigration and border protection system, “we can’t keep our country safe”.

And Keenan celebrated the government’s novel use of the immigration system to further its national security priorities.

The sum of these propositions is a continued linking of people seeking asylum with the notion of a threat to Australia’s integrity and security. Today’s announcement failed to show care or responsibility for the dehumanising impact of this strategy.

Instead, Dutton takes on a considerably expanded portfolio, despite extensive critique regarding his efforts to expand already very broad powers.

Australia’s bid for the UN Human Rights Council

Foreign Minister Julie Bishop was absent from today’s announcement. She is currently visiting India and Sri Lanka.

Her opposition to the creation of the new super-ministry has been widely reported.

Until today’s press conference, Brandis was also on record as opposing the creation of a super-ministry. This may explain the emphasis Turnbull placed on the oversight role of the attorney-general for “ensuring governments act lawfully and justly”.

Others will consider whether this change is called for in the sense of enhancing Australia’s security capacity or performance. But today’s announcement must also be assessed in the context of Australia’s human rights standing.

Bishop and Brandis have taken primary responsibility for promoting Australia’s current bid for election to the UN Human Rights Council. According to the Department of Foreign Affairs and Trade, Australia is the ideal candidate for a two-year term on the council, as it has been – and continues to be – an “international human rights leader”.

The government has taken steps to demonstrate Australia’s commitment to human rights, in support of its campaign.

For example, in February, Brandis announced that Australia would adopt the Optional Protocol to the Convention Against Torture (OPCAT). OPCAT aims to improve oversight of international standards at the domestic level. Its adoption in Australia will enable access for independent inspection agencies to Australian prisons and detention centres.

And, fortunately for Australia, France recently withdrew as a candidate. Although an election will still be held in October this year, Bishop is now confident that Australia and Spain will be elected unopposed to the two available seats for their regional grouping.

Regardless of the likelihood of its election, however, does today’s shift in the national security context support the legitimacy of Australia’s bid for election to the Human Rights Council?

In launching Australia’s bid, Bishop described human rights as “national values deeply embedded in Australian society”. Brandis described Australia’s candidacy as:

… the most natural thing in the world for a country which – at its core – is a nation built on a belief in, and a commitment to, the human rights of all – the human rights of all Australians and the human rights of all the peoples of the world.

Such characterisations are widely disputed by domestic and international commentary, which tests Australia’s performance against its international legal obligations.

Notably, the people ignored in today’s announcement – those seeking asylum from persecution in their home countries – have suffered human rights abuses in Australia’s immigration system.

It is difficult to see how the consolidation of far-reaching security powers in a single ministry will promote human rights. Outgoing Human Rights Commission president Gillian Triggs has already identified expanding executive power as a threat to democracy and human rights.

While the protection of the Australian community from terror threats is an undeniable and legitimate priority for any government, lawyers must oversee the coming reforms to determine whether they further threaten the delicate balance between safety and security on one hand, and freedom and rights on the other.

Australia’s model for these reforms, the UK Home Office, hardly has a stellar human rights record. It has been recently criticised for “making border guards of doctors”. Its officials have been given incentives for reaching asylum seeker rejection targets.

And in June this year, UK Prime Minister Theresa May demanded expanded anti-terror powers for government. She said:

… if human rights laws stop us from doing it, we will change those laws so we can do it.

The ConversationThe human rights implications of today’s announcement must be carefully monitored, particularly considering the lack of comprehensive human rights protection in Australian law.

Amy Maguire, Senior Lecturer in International Law and Human Rights, University of Newcastle

This article was originally published on The Conversation. Read the original article.