Fri, Mar 27, 2009 - Page 1 News List

Australia probes report military spied on minister


Australian Prime Minister Kevin Rudd told military officials yesterday to explain if they secretly spied on the defense minister because of his close friendship with a Chinese-born businesswoman.

The Age newspaper said Australian Defense Minister Joel Fitzgibbon was covertly investigated over his ties to Helen Liu, 48, a wealthy Chinese-Australian who has past financial links with Beijing.

Rudd said he had spoken to military chiefs, who launched an investigation into the accuracy of the report, which could embarrass the government at a time of political sensitivity about Chinese investment in Australia.

“I’m advised that neither the secretary of the defense department nor the chief of defense force staff have received any such reports,” Rudd told reporters in Washington after visiting the Pentagon.

In the course of the secret probe, an official from the Defense Signals Directorate hacked into Fitzgibbon’s office computer and found Liu’s banking details, the Age said. Fitzgibbon rents a home from her family in Canberra.

The allegations come after a series of clashes between Fitzgibbon and the military brass, the most recent involving a bungle over pay for soldiers in the elite Special Air Service (SAS).

Fitzgibbon has moved to slash waste in the multibillion-dollar defense budget since becoming minister in late 2007. Last month he chided officials over a mistake which meant some SAS troops had their pay docked.

He also accused defense officials of providing him with “nuanced information” to cover up mistakes and protect personnel.

Fitzgibbon conceded his reform drive had put some elements within the defense force offside.

“I am driving the biggest reform project in the history of the defense organization and I know that’s really hard for some elements of that organization,” he said.

The minister also denied there was anything untoward in his friendship with Liu.

“No one has ever raised any concern between that relationship and if anyone has concerns about that relationship they should have come forward and shared them with me,” he said.

The department’s top public servant, Secretary of Defense Nick Warner, said neither he nor military commander Air Chief Marshal Angus Houston knew anything about the allegations until they read about them in the newspapers.

He said he had no information suggesting there was any substance to the allegations but they were so serious they needed to be investigated.

“I have directed that the Defense Security Authority urgently investigate these matters,” he said. “I expect to see the initial results of this investigation soon.”

Fitzgibbon’s father Eric, a retired federal politician, said the alleged actions were “a slanderous attack” and it appeared someone was out for revenge against his son.

“It’s ridiculous to suggest that there’s anything wrong in the relationship between the Fitzgibbon family and the Liu family,” he told ABC television.

The report comes at a sensitive time for Australian-Chinese relations, with Canberra’s foreign investment watchdog scrutinizing applications by state-owned Chinese firms to buy into Australian resource companies.

Several lawmakers have called for the applications to be blocked, running national ads on TV.

Rudd, a Mandarin-speaking China expert, was criticized by newspapers last weekend for lunching in secret with China’s fifth most powerful ruling party member, propaganda chief Li Changchun (李長春), at his Canberra home.

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