"A new law to prevent the sharing of sensitive military information that came into force this week is causing confusion among former defence personnel who face a maximum 20-years imprisonment for breaching the Act," Innes Willox, Chief Executive of the national employer association Ai Group said today.

"While the Safeguarding Australia's Military Secrets Act, or SAMS Act, aims to protect our national security, the Act is in practice illogical, unfair and unworkable.

"The impact of this unguided missile of an Act on the defence industry, former Defence personnel (including veterans), and to Australia's trade position and international reputation is deeply concerning.

"From this week, one of the offences under the Act means that former Defence personnel (including former ADF, civilians working in Defence and full-time reservists) will need to apply for a 'foreign work authorisation' if they will be performing any work for a foreign military, government or for an organisation (even those unrelated to any military purpose) where the foreign government has control, whether formal or informal.

"Offences under the Act do not need to have a connection with 'military secrets', and because working with a foreign 'government body' is defined so broadly, the legislation could easily work in absurd ways.

"For example – if an administrative officer works in the Department of Defence, that person will need a foreign work authorisation for at least a year after they depart Defence if they want to work for one of the thousands of companies located in Australia with some foreign government influence or ownership. This is the case, even if the person did not have access to 'military secrets', and also if the company is a civilian entity with no connection to national security.

"Bizarrely, this offence under the Act does not apply to other high level clearance holders, including intelligence agencies, other government departments, ministerial staff, or defence contractors and consultants. So, the administrative officer with a low-level clearance will need a foreign work authorisation, but intelligence officers will not, nor will consultants who hold a top secret clearance.

"The SAMS Act will make it manifestly harder for thousands of Defence personnel and veterans to move into new roles after they leave their employment in Defence Department or the ADF.

"Ai Group estimates the Australian workforce potentially captured by the SAMS Act includes 230,000 current and former ADF personnel, and 70,000 civilians formerly employed in Defence administration. This is equivalent to around one in forty Australian workers. Even given the exemptions, the scope of the Act's potential impact is enormous.

"Overall, the legislation is also likely to create a significant chilling impact on defence exports, which would include exports to support Ukraine. Even if a company has a Defence export licence to export military equipment, all former Defence employees captured by the legislation will need to apply for individual authorisations in support of the program.

"Everyone supports the need to put sensible post-service controls in place for former Defence personnel to protect our national security. But the system needs to be fixed to be practical and workable for industry and employees.

"We urge the Government to sit down with industry experts to determine how to proceed in relation to the work authorisation process, a broad range of exemptions and the communication strategy.

"The SAMS Act comes from a place of good intentions. But alarming outcomes await Australia's defence capability unless there is a proper reconsideration of the legislation's remit and scope. Our national security demands it," Mr Willox said.

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