Speech to the International Serious and Organised Crime Conference
30 July 2013
Michael Pezzullo
Chief Executive Officer, Australian Customs and Border Protection Service
E&OE
Managing the security and integrity of the Australian border is essential for the protection and prosperity of the Australian community and economy. The border is a strategic national asset, and a very valuable one which should be actively managed and developed, and thought of, as a strategic national asset.
The border demarcates our sovereignty and delineates our dominion – where the dominion of the state begins and ends. It is not a wall, which completely seals off our nation and community. How could it, and why would we want it to, in the modern world of international trade and travel.
Rather than being seen as a barrier, we should see the border as a space where sovereign political units control the flow of people and goods in to and out of their dominion. At regulated ports of entry and exit, cross-border flows of people and goods take place. At these control points, sovereign political units are able to determine who and what has the right, or gift, of entry or exit, and under what conditions. The control of cross-border movement is one of the foundational national functions, which is exercised and managed for a variety of purposes, including the levying of duties and excise, the checking of travel identity and intention, and the interdiction of illegal, regulated or prohibited goods.
Borders play an important economic role as well. How they are managed can foster or impede lawful trade and travel. Border control points, systems and processes sit astride supply chains and travel pathways. The very design of these points, systems and processes can add to economic competitiveness and productivity, by fostering rapid movement and border entry or exit – or they can detract from competitiveness and productivity by impeding movement, entry and exit, and diminishing the efficiency of our national infrastructure.
For all of these reasons, the work of the Australian Customs and Border Protection Service is of vital national interest. While we have a long and proud history of protecting the border and serving the community, having existed in various guises since Federation, when the Department of Trade and Customs was established in 1901, it is my contention today that insufficient public discussion and debate about Customs and Border Protection is taking place, certainly in comparison with like public agencies such as the armed forces and the police services of this country. I would very much like to see a circumstance where there is increased serious academic and policy discussion in Australia about the customs and border protection function, and serious media coverage which extends beyond the episodic 'shock and scandal' coverage of internal corruption and breaches of the border.
This is not to say that there isn't a legitimate interest in internal corruption and breaches of the border. There is, and I do not shy away from public scrutiny of these matters. Nor is this to say that we have done a sterling job in recent years of explaining what we do, and more importantly how the complex border system works and how it might be reformed. We have not done a good job of explaining these things and we need to do better – much better.
Well, events have forced our hand, and perhaps not before time. In the past month, we have seen the publication of three crucial reports which, together, offer both a snapshot of the state of the Customs and Border Protection Service, and a due diligence framework within which to think about and decide what needs to be done to reform the Service and ensure that it is ready for the challenges of the future.
The three reports, which are all available on relevant Australian Government websites, are:
- The Interim Report of the Australian Commission for Law Enforcement Integrity (ACLEI) into alleged corrupt conduct by Customs and Border Protection officers at Sydney International Airport;
- The First Report of the Customs Reform Board, which is chaired by Mr Roger Wilkins AO, the Secretary of the Attorney General's Department, and consists of His Honour James Wood AO, QC, Mr Ken Moroney AO, APM and Mr David Mortimer AO;
- The Capability Review into the Service prepared by a review team which was assembled by the Australian Public Service Commission, led by LTGEN Mark Evans AO, DSC (ret'd), and which also consisted of Ms Akiko Jackson, Ms Elizabeth Kelly and Dr Heather Smith.
I will not go through these reports in any detail. Taken together, they are a clear warning call. The future outlook for managing Australia's border is challenging. In the very near future – before 2020 - our border systems will need to cope with an unprecedented increase in air cargo volumes and very significant increases in containerised sea cargo, parcels and other forms of international mail, and of course the number of international travellers.
The idea of screening every individual item and person has long been left behind, replaced by intelligence-based profiling and calculated interventions. In other words, intelligence plays a crucial role in our work at the border because it is impossible and ineffective (both financially and logistically) to physically inspect every passenger or consignment that crosses the border. We use intelligence to target and intervene against those that attempt to breach our borders or circumvent our controls.
Organised crime continues to be increasingly sophisticated, well-resourced, and resilient. As we tighten our border controls and capabilities, we face the reality that criminal enterprises will continue to seek new ways to move people and goods across the Australian border illegally. Globalisation has converged with the power of the internet. This means there will be more illicit transactions that knock out the middle man, and bypass traditional organised crime structures. Today, consumers are able to purchase illicit goods from anywhere in the world, and have them delivered to their door. And organised crime activities are not just limited to illicit drug markets. Criminals are involved in a range of activities across the border environment, which include revenue evasion, tobacco smuggling, money laundering, people smuggling, firearms trafficking, and trade in performance and image-enhancing drugs.
The way we currently operate will not be good enough to protect the border in the future. The increasing volume of cargo and traveller movement, the complexity of supply chains and travel routes, the threat of sophisticated criminal activities, combined with internal challenges around culture, integrity and corruption, all contribute to the clear need for a comprehensive programme of reform for the Service.
Incremental changes and tinkering at the edges just will not cut it – we need to undertake a complete transformation and all-consuming reform of the way we operate and the way we do business. Earlier this month, we launched the Australian Customs and Border Protection Service Blueprint for Reform 2013-2018, which is a five year blueprint that provides the roadmap for our root-and-branch reform.
Our reform programme will encompass all of the Service and will focus on three major tracks of change:
1.Our people and operating model: A professional and agile Service that is adaptive to change.
2.Modernisation of Systems and Processes: Efficient business systems and sophisticated intelligence capabilities.
3. Integrity: A disciplined Service culture and workforce hardened against corruption.
Today, I would like to highlight a number of specific initiatives which are contained within these three tracks of reform.
First, the border is not like the taxation system, or a system which can be regulated by a public agency standing afar. It is a live operating system, which consists of the physical spaces that I mentioned earlier. Live operating environments, whether we are talking about a battlefield, urban crime zones, or physical ports of entry, need first class command and control systems. Under Reform, we will create a strategic border command, which will have the national authority and tools to coordinate the flexible deployment of Customs and Border Protection resources against risks to the border (except in the offshore maritime domain, where maritime border protection will continue to be delivered by the joint command arrangements we have put in place over several decades with Defence).
The strategic border command will have advanced real-time intelligence, communications and surveillance systems to monitor and manage the border on an integrated, real-time 24/7 basis. It will direct the work of Customs and Border Protection regional border commands, which will be formed on state and territory lines.
The strategic border command will oversee our operations within designated Customs Controlled Areas at airports and ports, where our officers are able to employ powers under a wide range of Commonwealth legislation including powers to search and examine cargo, and the goods an individual is carrying on their person or within their luggage, and make copies of documentation and electronic media.
In support of strategic border command, we will enhance our policies and processes for the collection, management, exploitation, storage, use and sharing of information and intelligence. This will integrate with new field technologies to link up intelligence collected by our Customs and Border Protection officers in the field. We will also look at new advanced analytics and intelligence systems, and maximising opportunities to automate our risk analysis, profiling and targeting activities.
Real-time and mobile technologies are vital to enhancing our intelligence capabilities so we can act in real-time on the data at hand. We will introduce new tools that provide rapid and easy access to information for the community and our officers. This includes providing our officers on the frontline with new technologies focussed on rapid access to data in the field and receiving new tasking directions while 'on the go'. We will aim to better connect our systems with those of the private sector, and improve our ability to share classified information with trusted partners.
To support this effort, we will build a new National Border Targeting Centre to provide an enhanced approach to identifying high-risk international travellers and cargo through the application of better data integration and analysis tools. The Centre's initial focus will be on improving the Service's targeting processes and capabilities, and designing a multi-agency operating model for coordinating border intelligence. The Centre will deliver a significant capability boost and will build the foundation that we need to create a leading edge intelligence-led targeting system. A second phase of activity will establish a dedicated facility to house multiple agencies under one roof. This will enable joint planning of border operations, supported by improved cross-agency integration and data sharing.
Through the National Border Targeting Centre we will work closely with border management, intelligence, law enforcement and regulatory agencies with border interests, and collaboratively with regional partners and similar targeting centres in the United States, Canada, the United Kingdom and New Zealand.
We are going to focus under Reform on professionalisation of our workforce. All the systems in the world will not amount to a hill of beans if the workforce culture and capability of the Service is not first rate. Here we have started with integrity and anti-corruption measures. Last year, the Government introduced legislation to enable the Service to conduct:
- targeted integrity testing on officers suspected of corruption; and
- random drug and alcohol testing of all staff.
We have undertaken a pilot drug and alcohol testing program and the transition to fully implementing the testing regime across the Service is now complete. As CEO, I also have a new power that enables me to make a declaration that an officer has been terminated for serious misconduct. Earlier this year, I also issued instructions that make it mandatory for all staff to report serious misconduct and corruption.
We have also established a Special Integrity Adviser: a position responsible for managing the investigation of complex and serious cases of misconduct, including those undertaken jointly with ACLEI. The Special Integrity Adviser will also develop and implement integrity assurance arrangements and ensure that our anti-corruption processes and systems are fair. We will also be instituting fixed tenure periods for staff to mitigate the risk of corruption. These periods will not be 'one size fits all'. Generally speaking, operational officers will rotate every three years, while specialists will operate under different arrangements which we will design over the next six months or so, in consultation with our officers.
Our future workforce model being developed under the reform programme is also critical to our success. The development of our future workforce will focus on four vocational streams: Trade and Customs, the Border Force, Intelligence and Support. For this conference, I would like to highlight the Border Force, one of the most crucial elements of the Reform vision. The Border Force will be the visible front-line of the Service, a disciplined, uniformed enforcement capability, with Border Force officers working across the border continuum, including air and sea ports, remote areas and Australia's offshore maritime domain. Cross-skilling and comprehensive training will allow Border Force officers to be mobilised and deployed across the border continuum. It will be one of Australia's prime uniformed workforces, and I am determined to ensure that we build the support, training and development systems and processes to achieve and sustain this.
In the law enforcement space, the importance of inter-agency collaboration is paramount. We've already begun to transform our enforcement capability and I am personally very proud that the cornerstone to our enforcement transformation will be our strategic partnership with the Australian Federal Police in fighting border crime. The Australian community expects our Service and the Australian Federal Police to work together to defeat crime and attempts to illegally import goods at the border. They expect us to get the guns, stop the drugs and dismantle criminal syndicates that are ruining Australian lives. Artificial agency lines cannot be put around crime, and it is therefore incumbent upon us to ensure that our approach to crime at the border is holistic and cohesive.
As a first step under the reform blueprint we will pilot a new model for undertaking border crime investigations. This new model will combine the skills, intelligence and investigative resources of Customs and Border Protection and the Australian Federal Police, and enhance our shared understanding of criminal impacts at the border, to inform a proposed future operating model.
We will also build the partnership through the permanent secondment of a senior Australian Federal Police officer to work within the Service's Border Enforcement programme - which will also provide a direct link to operational components of the Australian Federal Police. As a first step in the new strategic partnership, we have developed a triage and decision-making model to be used by both agencies when deciding which border detections are progressed to cases and how these cases are investigated. Under the proposed triage model, we will jointly review referrals and decide together how to progress them to achieve more effective results against the actual crime threat, not just the single detection. At its most basic level, the joint triage model is about judgement. It is about bringing together the combined views and intelligence following a detection in order to determine the best operational response to the crime threat. The triage model will enable our respective agencies to channel our collective intelligence and investigative resources to maximise disruption of border crime and prosecute breaches of Commonwealth laws.
The intention of this approach is to ensure our respective agencies remain on top of major detections. The triage model allows both agencies to understand crime impacts and links to organised crime and will help facilitate the speedy deployment of resources to significant cases. It's about breaking down silos that exist around combating crime and expanding our approach, views and response to tackling crime at the border. The joint triage model will be piloted for three months, then reviewed and evaluated before the model is applied nationally.
Here in Brisbane, I should highlight another example of inter-agency collaboration. Following the success of the joint-agency Taskforce Polaris in New South Wales, Taskforce Jericho has been set up with nine Australian Federal Police officers as well as staff from Customs and Border Protection, Queensland Police Service, the Australian Crime Commission, Australian Tax Office and AUSTRAC, specifically to target organised crime in the cargo system in Queensland. In New South Wales, under Polaris, there have been 44 arrests, resulting in 196 charges, as well as the seizure of 119 tonnes or $77 million worth of illegal tobacco and the seizure of $1m in cash and 11 firearms. And since its establishment in Melbourne in July last year, the joint-agency work of Taskforce Trident has led to 16 arrests and the seizure of 71 tonnes or $61 million worth of illegal tobacco.
In conclusion, I would commend to this audience the Customs and Border Protection Blueprint for Reform, which you can find online at
www.customs.gov.au.
While it had its genesis as an internal corporate response to the problem of workforce, culture and integrity issues within the Service, it is my resolute belief that we need to approach the issues outlined in the Blueprint in a strategic manner, with the full weight and authority of the Australian Government behind it. The Blueprint cannot in my view idle along as an agency-level corporate plan. It needs to become a national strategy for strengthening our borders and fostering lawful trade and travel. These goals relate very directly to the nation's security and law enforcement strategies, as well as its productivity and competitiveness agenda. These issues are ones for the entire nation to consider.
Accordingly, I invite all interested parties to get involved and to help us to build a comprehensive and integrated response to the challenges of ever increasing travel and trade volumes, complex supply chains and criminality at the border. I would very much like to hear from all interested parties about how we might best enhance and improve our operating model, our workforce capability and culture, and our systems and processes. These are not matters just for the Australian Customs and Border Protection Service – they are matters for the nation as a whole.
Thank you.
