By MARK FORBES
DEFENCE CORRESPONDENT
CANBERRA

RELATED:
Singapore centre of spying allegations: ABC Lateline

SINGAPORE spies extensively on Australia and its bid for Optus should be blocked because it threatens national security, former senior defence officials and academics have warned.

Professor Ross Babbage, former assistant secretary of the Defence Department, said there were many instances of the Singapore government trying to compromise Australia's national security.

Professor Babbage told the Age that the bid for Optus by SingTel, 78 per cent owned by the Singapore government, should be blocked because of Optus' sensitive telecommunications role, including transmitting classified military satellite communications.

National security concerns about the bid were revealed by the Age in April, but after extensive negotiations and guarantees by SingTel, Defence Minister Peter Reith said he had no concerns about a takeover. The $17billion bid is awaiting approval from Treasurer Peter Costello and the Foreign Investment Review Board.

Professor Babbage, now with the Australian National University, said he could not detail Singapore's spying activities because of security restrictions. "We are not talking about one or two instances but a wide range of things," he said.

Many senior defence officials did not believe SingTel could be trusted, he said.

Professor Des Ball, Australia's foremost intelligence expert, said Singapore once recruited an Australian double agent at the Defence Signals Directorate listening station at Cabarlah in Queensland.

He said: "In 1993-94, there was quite significant concern at the DSD listening station about whether that facility had been penetrated by Singaporean intelligence authorities."

Senior officers were warned that a spy may have been active since 1981, when it was discovered that someone had been passing confidential material on to a senior Singaporean naval officer.

"Singapore is more actively engaged in intelligence collection activities in this part of the world than any other Southeast Asian country," Professor Ball said.

Professor Babbage said the acquisition of Optus would give Singapore direct access to Australia's most sensitive communications.

A Singapore government spokesman declined to comment on the allegations. Mr Reith also refused to discuss "security issues", but repeated that Defence Department security concerns had been satisfied.

SingTel has been forced to extend its offer for Optus because of the delay in receiving FIRB approval, which it now hopes to obtain this month.

Optus has a joint venture with Defence to launch the A$500 million C1 satellite next year to transmit classified military and intelligence communications worldwide.

Seven Network owner Kerry Stokes has opposed the takeover in a submission to the FIRB, saying he is concerned about Australia's second largest telecommunications company effectively being controlled by a foreign government. "SingTel is not a company, it's a government," he said.

In negotiations with Defence, SingTel is believed to have agreed that only those cleared by Australian security would operate sensitive equipment.