Prime ministers, spies and the law: how Bob Hawke saved Labor and his government  
1 Jun 2019|

Bob Hawke’s recent death prompted an outpouring of tributes to the Australian Labor Party’s longest-serving prime minister. Few recalled how close his government came to a terminal blow in its first year, largely at the hands of some who now sing his praises. Three days in August 1983, five months after the Hawke government was first elected, proved crucially important for its long-term survival and success.

For 30 years before Hawke came to office, many in the Labor party regarded the Australian Security Intelligence Organisation with intense hostility. Their suspicions that ASIO had timed the defection of Vladimir Petrov to help the conservative parties win the 1954 election were probably unfounded.

For the next 20 years, however, they had good reason to resent ASIO’s blatantly partisan attitudes, its feeding of intelligence information to anti-communist individuals and publications, and its chronic inability to distinguish between genuine subversion and legitimate dissent. At the ALP’s last federal conference before the 1972 election, ASIO’s critics almost succeeded in having the agency’s abolition adopted as official party policy. The party leadership just managed to substitute the promise of a major inquiry into the intelligence services.

Action was delayed by Attorney-General Lionel Murphy’s notorious ‘raid’ on the ASIO headquarters in Melbourne. In late 1974 Gough Whitlam commissioned Robert Marsden Hope, a judge of the NSW Supreme Court and former president of the NSW Council for Civil Liberties, to conduct a royal commission into the intelligence agencies. This was not, as it was often described then (and ever since), an inquiry into ASIO, but a far-reaching and detailed examination and reconstruction of the entire intelligence system.

Hope’s eight reports, many in several volumes, prescribed in great detail not only what each of the agencies should do—and what they should not do—but also how they should operate as an intelligence community and how they should interact with departments and ministers. But as far as many in the Labor party, the civil liberties community and the media were concerned, all that mattered was Hope’s assessment of ASIO.

Hope was scathingly critical of ASIO. Its failures in counterespionage pointed to the strong possibility of a Soviet ‘mole’. In its disproportionate attention to countersubversion, it treated mildly left-wing views as serious threats. Its role in circulating anti-communist material was misguided.

Insisting that ASIO should act in a way that would earn and retain the confidence of governments of all persuasions, Hope set out in considerable detail how it should operate within its charter, within the law, and within the bounds of ‘propriety’—all of which it had breached. He recommended the establishment of a security appeals tribunal and a number of measures to improve the accountability of all agencies, especially ASIO, to ministers, officials and institutions such as the office of the auditor-general.

Despite the intense partisan tensions at the time of the dismissal of the Whitlam government, Hope’s recommendations were supported by the principal figures in both Labor and the coalition parties. For the next 40 years, his reports established the framework for reforms of the intelligence community. Two major developments in 2018—the upgrading of the Office of National Assessments to the Office of National Intelligence and the establishment of the Australian Signals Directorate as a statutory authority—were consistent with his reports in 1976–77.

ASIO’s critics, however, remained focused on the fact that, after long and careful deliberation, Hope did not recommend abolition of the agency but said it should continue to exist, with augmented resources, under strict supervision and accountability. Throughout the Fraser government’s term (1975 to 1983), three factors kept debate on the intelligence agencies in the headlines. Civil libertarians, Labor lawyers and others continued to criticise ASIO, even as new leadership sought to make it more professional and competent.

Many departmental officials objected to Hope’s numerous proposals to ensure that the agencies served ‘government as a whole’, rather than individual departments like defence and foreign affairs. Rivalries within and among agencies and departments led to a flood of leaked documents. A new generation of young, mostly left-leaning, journalists, especially at the Fairfax weekly the National Times, were only too willing to publish them. Amid the enduring suspicions that American intelligence agencies had been improperly associated with the fall of the Whitlam government, any leak that reflected on intelligence agencies or the Australian–American alliance was guaranteed considerable prominence.

Leaks continued after Hawke led the ALP to victory in March 1983. While delighted with their electoral success, many Labor party members and supporters remained critical of Hawke for the way he had seized the party’s leadership on the day the election was called, after Bill Hayden had rescued the party from electoral disasters in 1975 and 1977.

They also objected to Hawke’s obvious determination to demonstrate that his government could be trusted on national security and the American alliance, and resented his bypassing the party and the media to establish a personal rapport with the Australian people. The leaks suggested that the agencies, including ASIO, were too close to the American agencies, and were not acting in accordance with the principles Hope had laid down.

In his first year as prime minister, Hawke faced more serious criticism from the left, on these and similar issues, than from the conservative coalition he had just defeated. He needed to reassure Australia’s intelligence partners, especially Washington, that his government was responsible on national security, while simultaneously assuring the civil libertarians and the left that he understood their concerns.

He discussed with agency heads and other officials the idea of a ‘judicial audit’ of the agencies, possibly another royal commission, to check whether they were complying with the directions that Hope’s previous royal commission had laid down. The matter became urgent in early May, when the National Times published the first of what it said were ‘tens of thousands’ of classified documents it held. Hawke approached Hope, who agreed, without any great enthusiasm, to undertake a second royal commission. Nothing was publicly announced while the terms of reference were being drafted.

In the following days, the political stakes were raised dramatically. Before the election, ASIO had identified a diplomat at the Soviet embassy in Canberra, Valeriy Ivanov, as a KGB operative. Monitoring of his calls and movements revealed that he had been meeting with David Combe, a former national secretary of the ALP who was establishing himself as a lobbyist in Canberra, with an interest in developing Soviet–Australian trade. Combe had spoken loosely about his intention to make ‘big money’ from his access to Labor ministers, and voiced his suspicions about CIA interference in Australian politics.

ASIO reported to Hawke that Combe was close to being compromised by Ivanov. Hawke and the cabinet’s security committee decided to expel Ivanov and to ban Combe’s access to government ministers. They tried to obscure the purpose by restricting access by all lobbyists, but leaks soon revealed that Combe was the main target.

Amid uproar in parliament, Hawke knew that the government’s handling of the issue had to be investigated by an independent authority. No such institution, however, yet existed. (One of the principal outcomes of the second royal commission was the creation of the office of inspector-general of intelligence and security in 1986.) He therefore decided to refer the matter to Hope, as the most urgent item on the agenda of the royal commission the two had discussed but not yet announced.

Addressing a turbulent parliament, Hawke chose his words carefully when announcing the new royal commission, because he had not secured Hope’s agreement to the addition of the Combe–Ivanov matter as its most urgent item. In his capacity as foundation chancellor of the University of Wollongong, Hope was presiding over a graduation ceremony. Nothing, not even urgent calls from the prime minister, took priority over that duty.

So began ‘the Combe–Ivanov affair’. During the winter of 1983, the royal commission’s hearing on this matter dominated the Australian media. It was the only part of Hope’s two royal commissions to be conducted in the courtroom-style format familiar to television viewers, most recently in the Kenneth Hayne banking royal commission.

From the outset, the media, with considerable encouragement from Combe’s legal team, reported the hearing as if it were a criminal trial, with Combe being tried on an undefined charge on the basis of evidence to which he did not have access. Combe’s barrister, Ian Barker QC, had just successfully prosecuted Lindy Chamberlain for the murder of her daughter Azaria.

Barker now sought to turn the hearing into a trial of ASIO, and by implication of Hawke, at least in the court of public opinion. Combe and his lawyers exploited his popularity in the media, seeking to undermine ASIO’s reputation and thereby to attack Hawke. Several unprofessional errors by ASIO helped their cause.

When it was discovered in July that a senior minister, Mick Young, had misled Hawke, leading to his sacking from cabinet, the media frenzy worsened. Within Labor and media circles, Young was even more popular and respected for his political judgement than Combe. Hawke was now accused of sacrificing two Labor mates, at the behest of an incompetent ASIO, in order to appease Washington.

At this point, what had started as a relatively minor issue threatened to deal a serious, perhaps terminal, blow to the government’s authority. Hawke and the government’s counsel, Michael McHugh QC, took the high-risk decision to call the prime minister as the first of the government’s witnesses, instead of building the case towards his appearance. The three days set aside included a Saturday, to enable Hawke to undertake an overseas commitment.

The media and the public were fascinated by the unprecedented prospect of a prime minister being cross-examined, in a public hearing before a senior judge, by some of the nation’s leading barristers. Many observers believed that the new government’s chances of re-election depended on Hawke’s performance during those three days in the witness box.

A graduate in law as well as arts and economics, Hawke prepared himself assiduously, ensuring he knew exactly what to say and what traps to avoid. He gave confident and carefully worded answers to the counsel assisting the commission, Don Ryan QC, as well as to McHugh and to ASIO’s counsel, Stephen Charles QC. When cross-examined by Barker, Hawke answered aggressively, recalling his tactics in the 1960s as the ACTU’s advocate before the Conciliation and Arbitration Commission. As Charles later observed:

Hawke had raised to a high art the ability not to answer a difficult question, sometimes by answering a different question of his own choosing. When challenged by Barker, who is a very good cross-examiner, he attacked Barker. This is about the only occasion I can recall of a really competent cross-examiner being demolished from the witness box.

Hawke’s supporters and critics alike agreed that his appearance was the turning point in the Combe–Ivanov hearing. Other ministers generally supported Hawke’s case, and Combe could not match Hawke’s performance under cross-examination. A potential disaster for the government had been turned into a triumph.

Hope’s report in December, although not wholly uncritical, was seen as the inevitable vindication of the government’s actions. Having confronted and defeated a major threat from civil libertarian and left-wing critics, Hawke could now tackle major reforms of domestic and international policies from a position of consolidated strength.