Penalties

9.132   The final section of this chapter discusses two issues relating to penalties for the breach of specific secrecy offences: inconsistencies in current penalties for secrecy offences and the development of benchmark penalties for secrecy offences that include a requirement of harm.

Inconsistencies between specific secrecy offences

9.133   Penalties in specific secrecy offences vary widely, from a fine of $110[157] to imprisonment for 25 years.[158] The following table provides a breakdown of the maximum penalties applicable to specific secrecy offences, by percentage of offences identified by the ALRC.[159]

Penalty

%

Pecuniary penalty only

10%

Imprisonment for 1 year or less

15%

Imprisonment for 2 years

67%

Imprisonment for 5 years

4%

Imprisonment for 7 years

1%

Imprisonment for 10 years

1%

Imprisonment for 15 years or more[160]

1%

9.134   The House of Representatives Standing Committee on Legal and Constitutional Affairs has expressed the view that ‘consistency in the range and expression of penalties in criminal secrecy provisions is desirable’, but acknowledged that ‘there may need to be some flexibility depending on the sensitivity of the information to be protected’.[161]

9.135   In the course of this Inquiry, a number of stakeholders highlighted inconsistencies in the penalties for the unauthorised disclosure of similar kinds of information in similar contexts.[162] For example, ACLEI noted that inconsistent penalty provisions apply to employees of the ACC and the AFP.[163] These offences provide that:

  • the maximum penalty that applies to members and staff of the ACC for recording, divulging or communicating information acquired in the performance of their duties or functions is a term of imprisonment for one year and a $5,500 fine;[164] while

  • the maximum penalty applying to members, employees and persons engaged by the AFP for engaging in similar conduct is a term of imprisonment for two years and $13,200 fine.[165]

9.136   ACLEI submitted that the penalty in the Australian Crime Commission Act 2002 (Cth) should be made consistent with that under the Australian Federal Police Act 1979 (Cth).[166]

9.137   The DHS also noted that penalties vary across its portfolio legislation:

For example, the penalty for an employee disclosing (however termed) protected information ranges from $500 (Health Insurance Act) to 2 years imprisonment and 120 penalty units ($13,200 at the time of writing) (Dental Benefits Act [2008 (Cth)]). Medicare Australia advises that the information protected under the Health Insurance Act and the Dental Benefits Act is essentially the same.[167]

9.138   The DHS stated that these anomalies are even more noticeable within agencies that are subject to more than one secrecy provision. For example, an officer of Medicare Australia who discloses information protected under the National Health Act faces a maximum fine 10 times that of an officer committing the same offence under the Health Insurance Act, and only the former attracts a sentence of imprisonment.[168]

Even within the same Act there are apparent inconsistencies. Under the Health Insurance Act a person who offers to supply protected information can be imprisoned for 2 years, whereas the maximum penalty for actually doing so is $500.[169]

Inconsistencies with the Crimes Act

9.139   Part IA of the Crimes Act contains a number of provisions relevant to determining penalties for breach of a federal offence, which apply unless the specific offence provides otherwise. These provisions set out default rules regarding pecuniary penalty to imprisonment ratios;[170] penalties for corporations;[171] and different penalties for summary and indictable proceedings.[172]

9.140   The ALRC has identified a number of specific secrecy offences which are inconsistent with the approach set out under the Crimes Act, including that:

  • the fine to imprisonment ratio provided by some secrecy offences differs—to varying degrees—from the standard ratio of five penalty units to one month of imprisonment (5:1 ratio) set out in s 4B of the Crimes Act;[173]

  • the maximum fines applicable to bodies corporate provided under some secrecy offences differ from the ‘times five’ multiplier provided by s 4B(3) of the Crimes Act;[174]

  • some indictable secrecy offences provide for penalties where the offence is dealt with summarily that differ from those provided by s 4J(3) of the Crimes Act;[175] and

  • some secrecy provisions provide that they are summary offences, but include penalties which, under s 4H of the Crimes Act, would make the offence an indictable offence.[176]

9.141   In DP 74, the ALRC proposed that, in order to ensure consistency, specific secrecy offences should not stipulate:

  • fines for individuals and corporations different from those that would apply if the formulas set out in the Crimes Act were adopted;

  • penalties different from those that would apply if the alternative penalties for proceeding summarily on an indictable offence set out in the Crimes Act were adopted; or

  • a penalty punishable on summary conviction when, under the Crimes Act, an offence carrying that maximum penalty would otherwise be tried before a jury on indictment.[177]

Penalty benchmarks

9.142   The Guide to Framing Commonwealth Offences sets out principles for setting penalties in Commonwealth criminal offences. As a general principle, the Guide states that:

A maximum penalty should be adequate and appropriate to act as an effective deterrent to commission of the offence to which it applies, and should reflect the seriousness of the offence in the relevant legislative scheme. A heavier penalty will be appropriate where there are strong incentives to commit the offence, or where the consequences of the commission of the offence are particularly dangerous or damaging.[178]

9.143   The Guide also sets out penalty benchmarks for certain classes of offences.[179] It specifies a maximum penalty benchmark of two years imprisonment or 120 penalty units for breach of secrecy provisions—citing as examples provisions which relate to both initial[180] and subsequent[181] unauthorised disclosure of Commonwealth information.

9.144   The exercise of judicial discretion in sentencing allows the imposition of a lower penalty if justified by the nature and circumstances of the offence and any injury, loss or damage resulting from the offence.[182]

9.145   The Guide directs those framing offences to ‘ensure [the] penalty fits with other penalties in Commonwealth law’:

Penalties should be framed to maximise consistency with penalties for existing offences of a similar kind or of similar seriousness. Penalties within a given legislative regime should reflect the relative seriousness of the offences within that scheme.[183]

9.146   Therefore, the penalties for contravention of specific secrecy offences—which, in the ALRC’s view, should generally include a requirement that the disclosure cause, or be likely or intended to cause harm to an essential public interest[184]—should be comparable to penalties for conduct that causes similar kinds of harm and consistent with the culpability of the offender, which will be determined by a number of factors including the fault elements that apply to the offence.

9.147   Other benchmarks specified in the Guide to Framing Commonwealth Offences are relevant in gauging the relative criminality of conduct that results in harm to public interests. For example, the Guide includes the following penalty benchmarks:

  • six months imprisonment, or 30 penalty units, for offences by witnesses;

  • 50 to 60 penalty units for failure to lodge reports or returns;

  • 12 months imprisonment, or 60 penalty units, for making false statements in notices or applications or failing to provide information that is required;

  • two years imprisonment, or 120 penalty units, for breaching confidentiality requirements and for making false statements in applications for warrants;

  • five years imprisonment, or 300 penalty units, for corruption and abuse of public office; and

  • life imprisonment for treason, certain war crimes and terrorist acts.[185]

9.148   Other federal offences that result in harm to public interests may also provide a guide for developing penalties for the breach of secrecy offences. For example, it is an offence for any person to disclose information about the identity or location of a person in the National Witness Protection Program, or information which compromises the security of such a person.[186] Because of the serious harm that is likely to be caused by disclosure in breach of this provision, a maximum penalty of 10 years is prescribed.

9.149   In DP 74, the ALRC proposed that specific secrecy offences should generally provide for a maximum penalty of two years imprisonment, or a pecuniary penalty not exceeding 120 penalty units, or both.[187] The ALRC also proposed that where an offence includes a requirement that the disclosure causes, or is likely or intended to cause, harm to an essential public interest, the penalty should be consistent with those proposed in the general secrecy offence. For example, where a person knows, is reckless as to whether, or intends the disclosure of Commonwealth information to damage, for example, national security the penalty should be a maximum of seven years imprisonment, or a pecuniary penalty not exceeding 420 penalty units, or both.[188]

9.150   Finally, the ALRC has identified seven secrecy offences that specify maximum terms of imprisonment of three months.[189] Such penalties are contrary to the advice contained in the Guide to Framing Commonwealth Offences, which directs those framing Commonwealth offences to refrain from imposing terms of imprisonment of less than six months:

Avoiding provision for short term prison terms underlines the message that imprisonment is reserved for serious offences and also avoids the potential for burdening State/Territory correctional systems with minor offenders.[190]

9.151   In DP 74, the ALRC proposed that specific secrecy offences that provide for maximum penalties of imprisonment for less than six months, or by pecuniary penalties only, should be reviewed and considered for repeal.[191]

Submissions and consultations

9.152   While only a few stakeholders commented on the proposals in DP 74 relating to penalties for specific secrecy offences, the common theme was support for consistency and the legal principle that similar offences should have similar penalties.

9.153   Liberty Victoria and CLA both supported a review of penalties to ensure consistency.[192] The ACC expressed support for the general principle that penalties for secrecy offences should be consistent, but noted that in some circumstances there may be legitimate reasons why some penalties are higher or lower than others. For example, the ACC submitted that some penalties in the Australian Crime Commission Act are high because of difficulties experienced in achieving compliance with coercive powers exercised by ACC examiners.[193]

9.154   In response to the discussion of appropriate penalties in IP 34,[194] the AGD noted that currently most secrecy offences carry a maximum penalty of two years imprisonment and that this ‘seems to be an appropriate penalty for the majority of secrecy offences’, adding that:

Generally, those secrecy offences involving particularly sensitive or national security information impose higher maximum penalties. The underlying principle for the imposition of higher maximum penalties in this latter category of offences is that there are certain types of Commonwealth information, the unauthorised disclosure of which could cause significant harm to the public interest and as such require additional protection. By its nature, the unauthorised disclosure of national security information will carry a higher likelihood of harm to the public interest. For example, national security information that has been received from sensitive sources such as foreign governments could not only damage international relations with that government but also jeopardise the security or defence of Australia.[195]

9.155   The AGD noted that maximum penalties can be set by reference to the fault elements that apply, as well as to the potential harm that could be caused by the relevant conduct.[196]

9.156   The Law Council of Australia submitted that maximum penalties for secrecy offences should be ‘identified and set by reference to the kind of information protected’.[197] The Public Interest Advocacy Centre submitted that:

the preferred approach should be to seek consistency in maximum penalties based on the following factors: the nature and volume of the material in question; the nature and extent of any harm or potential harm to identified public interests; the intent and motive of the defendant; the level of seniority and office held by the defendant; and any countervailing public interest factors.[198]

9.157   A number of stakeholders submitted that secrecy offences should provide penalties that are consistent with the general provisions of Part IA of the Crimes Act.[199]

ALRC’s views

9.158   In this Report, the ALRC recommends that specific secrecy offences should be used only where they are necessary to protect an essential public interest of sufficient importance to justify criminal sanction.[200] Criminal penalties for disclosure of Commonwealth information should be reserved for disclosures that cause, or are likely or intended to cause, harm to essential public interests.[201]

9.159   The penalty stated in a specific secrecy offence will therefore depend on the nature of the harm arising from the unauthorised disclosure of the information and the fault elements that apply to the particular offence.

9.160   In some cases, a higher maximum penalty will be appropriate: for example, where the fault element attaching to the harm, or the seriousness of the harm caused, or likely to be caused, by the disclosure, indicate a higher level of culpability.

9.161   In relation to the general secrecy offence, the ALRC recommends that a maximum penalty of seven years imprisonment is appropriate where a Commonwealth officer knows, or is reckless as to whether, or intends the disclosure of Commonwealth information to cause harm to:

  • national security, defence or the international relations of the Commonwealth;

  • the prevention, detection, investigation, prosecution or punishment of criminal offences;

  • the life or physical safety of any person; or

  • the protection of public safety.[202]

9.162   The higher maximum penalty recommended in the general secrecy offence is intended to reflect the higher culpability of the offender—indicated by the fault element attaching to the harm and the seriousness of the harm that is likely to be caused.

9.163   As discussed in Chapter 8, there may be a need for specific secrecy offences to address harms not included in the general secrecy offence. For example, regulatory agencies, such as taxation and social security agencies and corporate regulators, need to strictly control sensitive personal and commercial information provided to them by the public. In these cases, the ALRC considers that the unauthorised disclosure of this information has the potential to harm the relationship of trust between the government and individuals, and compromise the effective functioning of these regulatory agencies—harms not included in the recommended general secrecy offence. In such cases, the ALRC considers that a maximum penalty of two years imprisonment, or 120 penalty units would reflect the nature of the harm arising from the disclosure and would be consistent with other similar offences.

9.164   In some cases, the ALRC’s recommended approach will mean that specific secrecy offences include tiers of offences that attract different penalties. The secrecy offences in the Surveillance Devices Act 2004 (Cth), which make it an offence to disclose protected information, take this approach. Protected information includes any information obtained from the use of a surveillance device, information relating to an application for, or existence of, a warrant, or any information that is likely to enable the identification of a person, object or premises specified in a warrant.[203] The offence of unauthorised use, recording or disclosure of protected information carries a maximum penalty of two years imprisonment[204]—which seems appropriate, given the need to protect information about, or obtained by covert surveillance.[205] However, where the same conduct ‘endangers the health or safety of any person or prejudices the effective conduct of an investigation into a relevant offence’—both serious harms commensurate with those in the general secrecy offence—the offence provides for a higher penalty of 10 years imprisonment.[206]

9.165   In the ALRC’s view, a particularly low penalty suggests that the specific secrecy offence is not directed to preventing disclosures that are likely to cause harm of sufficient seriousness to warrant a criminal offence. Given that there are a range of other mechanisms in place to protect government information—including administrative sanctions, contractual obligations and the general law—secrecy offences that are currently punishable by imprisonment for less than six months, or by pecuniary penalties only, should be reviewed and considered for repeal.[207]

9.166   In the ALRC’s view, there appears to be no justification for inconsistency between the penalties in specific secrecy offences and the approach prescribed by the Crimes Act in relation to the fine to imprisonment ratio and penalties for summary and indictable offences. Such provisions should be reviewed with a view to bringing them into line with the criteria in the Crimes Act.

Recommendation 6–8               Maximum penalties in specific secrecy offences should reflect the seriousness of the potential harm caused by the unauthorised conduct and the fault elements that attach to the elements of the offence.

Recommendation 6–9               Specific secrecy offences should not generally prescribe:

(a)       fines for individuals and corporations different from those that would apply if the formulas set out in the Crimes Act 1914 (Cth) were adopted;

(b)      penalties different from those that would apply if the alternative penalties for proceeding summarily on an indictable offence set out in the Crimes Act were adopted; or

(c)       a penalty punishable on summary conviction when, under the Crimes Act, an offence carrying that maximum penalty would otherwise be tried on indictment.

[1]           Recommendation 8–3.

[2]           See, eg, Australian Postal Corporation Act 1989 (Cth) ss 90H, 90LB apply to ‘employees of Australia Post’; Customs Administration Act 1985 (Cth) s 16 applies to ‘a person performing duties in the Australian Customs Service as a person employed or engaged by the Commonwealth, a Commonwealth agency, a State or a State agency’; Income Tax Assessment Act 1936 (Cth) s 16 applies to ‘a person who is or has been appointed or employed by the Commonwealth or by a State, and who by reason of that appointment or employment, or in the course of that employment, may acquire or has acquired information respecting the affairs of any other person, disclosed or obtained under the provisions of this Act or of any previous law of the Commonwealth relating to income tax’.

[15]         Australian Intelligence Community, Submission SR 37, 6 March 2009.

[16]         See, eg, Law Enforcement Integrity Commissioner Act 2006 (Cth) s 90; Maritime Transport and Offshore Facilities Security Act 2003 (Cth) s 40; Productivity Commission Act 1998 (Cth) s 53.

[17]         See, eg, Social Security (Administration) Act 1999 (Cth) ss 205, 206;  Health Insurance Act 1973 (Cth) s 130(14), (21); Child Care Act 1972 (Cth) ss 12K, 12Q. Conduct covered by secrecy offences is discussed later in this chapter.

[18]         Student Assistance Act 1973 (Cth) ss 353, 3(1) (definition of ‘protected information’).

[19]         Australian Law Reform Commission, Review of Secrecy Laws, Discussion Paper 74 (2009), [10.79].

[20]         Ibid, Proposal 10–3. The general secrecy offence is discussed in Chs 5, 6 and 7, while subsequent disclosure offences are discussed in Ch 6.

[157]       Reserve Bank Act 1959 (Cth) s 79B.

[158]       Criminal Code (Cth) s 91.1.

[159]       Percentages do not add up to 100 due to rounding.

[160]       This category includes one offence that allows a judge unfettered discretion with respect to the level of penalty that may be imposed: Defence Act 1903 (Cth) s 73A attracts a maximum penalty of imprisonment ‘for any term’ or a ‘fine of any amount’ or both.

[161]       Australian Parliament—House of Representatives Standing Committee on Legal and Constitutional Affairs, In Confidence: A Report of the Inquiry into the Protection of Confidential Personal and Commercial Information Held by the Commonwealth (1995), 96–97.

[162]       See, eg, Law Council of Australia, Submission SR 30, 27 February 2009; Department of Human Services, Submission SR 26, 20 February 2009; Australian Commission for Law Enforcement Integrity, Submission SR 18, 18 February 2009.

[163]       Australian Commission for Law Enforcement Integrity, Submission SR 18, 18 February 2009, referring to Australian Crime Commission Act 2002 (Cth) s 51; Australian Federal Police Act 1979 (Cth) s 60A.

[164]       Australian Crime Commission Act 2002 (Cth) s 51.

[165]       Australian Federal Police Act 1979 (Cth) s 60A.

[166]       Australian Commission for Law Enforcement Integrity, Submission SR 18, 18 February 2009.

[167]       Department of Human Services, Submission SR 26, 20 February 2009.

[168]       Ibid.

[169]       Ibid.

[170]       Crimes Act 1914 (Cth) s 4B(2) provides that where an offence provision refers only to a penalty of imprisonment, a court may impose a pecuniary penalty if it thinks it appropriate. The maximum pecuniary penalty is five times the term of imprisonment expressed in months.

[171]       Ibid s 4B(3) provides that where a body corporate is convicted of an offence, the court may impose a pecuniary penalty not exceeding an amount equal to five times the maximum penalty that the court could impose on a natural person convicted of the same offence.

[172]       Ibid ss 4J, 4JA.

[173]       For example, the ratio provided by the Excise Act 1901 (Cth) s 159 is more than 20:1 (500 penalty units and two years imprisonment). Under the Australian Institute of Health and Welfare Act 1987 (Cth) s 29, the ratio is less than 2:1 (20 penalty units and one year of imprisonment). Drafting guidelines for Commonwealth offences instruct drafters to adopt the 5:1 ratio ‘unless there are grounds to depart from it’: Australian Government Attorney-General’s Department, A Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers (2007), 41.

[174]       See, eg, Defence Act 1903 (Cth) s 73F(2) which prescribes a maximum fine for a body corporate 10 times that which can be imposed on a natural person.

[175]       See, eg, Disability Services Act 1986 (Cth) s 28 and Telecommunications (Interception and Access) Act 1979 (Cth) s 105 which provide for a maximum term of six months imprisonment on a summary conviction, which is 50% less than would otherwise apply under Crimes Act 1914 (Cth) s 4J.

[176]       See, eg, Taxation (Interest on Overpayments and Early Payments) Act 1983 (Cth) s 8 which provides for a maximum penalty of two years imprisonment and an $11,000 fine, punishable on summary conviction.

[177]       Australian Law Reform Commission, Review of Secrecy Laws, Discussion Paper 74 (2009), Proposal
11–4.

[178]       Australian Government Attorney-General’s Department, A Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers (2007), 38.

[179]       Ibid, 47.

[180]       Data-matching Program (Assistance and Tax) Act 1990 (Cth) s 15; Customs Administration Act 1985 (Cth) s 16(2).

[181]       Australian Hearing Services Act 1991 (Cth) s 67(8).

[182]       Crimes Act 1914 (Cth) s 16A(2).

[183]       Australian Government Attorney-General’s Department, A Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers (2007), 38.

[184]       Recommendations 8–1, 8–2.

[185]       Australian Government Attorney-General’s Department, A Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers (2007), 47–48.

[186]       Witness Protection Act 1994 (Cth) s 22.

[187]       Australian Law Reform Commission, Review of Secrecy Laws, Discussion Paper 74 (2009), Proposal
11–8.

[188]       Ibid, Proposals 11–9, 11–10.

[189]       Equal Opportunity for Women in the Workplace Act 1999 (Cth) s 32; Broadcasting Services (Transitional Provisions and Consequential Amendments) Act 1992 (Cth) s 25; Defence (Inquiry) Regulations 1985 (Cth) regs 62, 63; Commonwealth Functions (Statutes Review) Act 1981 (Cth) s 234; Port Statistics Act 1977 (Cth) s 7; Social Welfare Commission (Repeal) Act 1976 (Cth) s 8.

[190]       Australian Government Attorney-General’s Department, A Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers (2007), 42–43.

[191]       Australian Law Reform Commission, Review of Secrecy Laws, Discussion Paper 74 (2009), Proposal
11–11.

[192]       Liberty Victoria, Submission SR 50, 5 August 2009; Civil Liberties Australia, Submission SR 47, 27 July 2009.

[193]       Australian Crime Commission, Submission SR 75, 19 August 2009.

[194]       Australian Law Reform Commission, Review of Secrecy Laws, Issues Paper 34 (2008), Questions 5–4,
5–6.

[195]       Attorney-General’s Department, Submission SR 36, 6 March 2009.

[196]       Ibid.

[197]       Law Council of Australia, Submission SR 30, 27 February 2009.

[198]       Public Interest Advocacy Centre Ltd, Submission SR 38, 9 March 2009.

[199]       Australian Securities & Investments Commission, Submission SR 41, 17 March 2009; Public Interest Advocacy Centre Ltd, Submission SR 38, 9 March 2009; Attorney-General’s Department, Submission SR 36, 6 March 2009; The Treasury, Submission SR 22, 19 February 2009.

[200]       Recommendation 8–1.

[201]       Recommendation 8–2.

[202]       Recommendation 5–1.

[203]       Surveillance Devices Act 2004 (Cth) s 45. Protected information is defined in s 44.

[204]       Ibid s 45(1).

[205]       This offence does not include an express requirement that the disclosure cause, or is likely or intended to cause, harm to an essential public interest. However, like information obtained by a telecommunications interception, discussed in Ch 8, the category of information protected by this offence is precisely defined, and there are persuasive policy arguments for its absolute protection, including that covert surveillance involves a serious invasion of privacy. As such, it may not be appropriate for the offence to expressly require that the disclosure cause, or be likely or intended to cause, harm.

[206]       Surveillance Devices Act 2004 (Cth) s 45(2). Because the Surveillance Devices Act is part of a national scheme, most states have enacted mirror offences with similar penalties: Attorney-General’s Department, Submission SR 67, 14 August 2009.

[207]       The review of specific secrecy offences is discussed in Ch 11.