With the end of the Second World War, in a struggle for power and influence, the Soviet Union squared off against its former allies: the US, Britain and France. The USA, Britain, Canada, Australia and New Zealand agreed on cooperative intelligence operations, based around the UKUSA agreement of 1946. The need to be seen as a trustworthy Cold War ally was probably the main factor in New Zealand setting up its intelligence service.
The Police Special Branch
The Police Special Branch was established in December 1949. It concentrated on surveillance of the Communist Party and other ‘radicals’. The limitations of the Special Branch in a small society became clear during the 1951 waterfront industrial dispute. Undercover work was extremely difficult; all the branch detectives were well known to the unionists and their supporters.
In November 1956 the government set up an independent intelligence organisation – the New Zealand Security Service, with the Police Special Branch being disbanded by August 1957. This move followed a series of damning reports on the Special Branch from the controller general of police and from British and Australian security service officers. There were also concerns over corruption at top levels of the police. Security fears were heightened by a Soviet defector in Australia, Vladimir Petrov, who alleged that an informer was operating at a high level in the New Zealand government.
The SIS and the Cold War
The Security Service, in 1969 renamed the Security Intelligence Service (SIS), was closely modelled on the British MI5. It gathered intelligence to counter espionage, sabotage and subversion. Counter-espionage largely consisted of monitoring the Soviet and East European embassies. From 1973 the newly established Chinese embassy was added to the list. The SIS also carried out security checks on government personnel and on people entering the country.
Most SIS activities were carried out discreetly, but some cases received publicity. In 1962 the service exposed two Soviet diplomats who were expelled for attempting to obtain information through bribery. In 1974 William Sutch, an economist and former senior public servant, was arrested and charged with espionage, following an SIS investigation. He was suspected of passing intelligence to the Soviet Union, but was later acquitted. In 1980 an SIS investigation led to the expulsion of Soviet ambassador Vsevolod Sofinsky for allegedly passing money to the Socialist Unity Party.
Spying on ‘subversives’
Counter-subversion involved investigating communist, pro-Soviet or pro-Chinese groups, along with activist groups the SIS saw as being significantly influenced by members of subversive groups. These included groups such as Campaign against Foreign Control in New Zealand, the New Zealand China Friendship Society and HART (Halt All Racist Tours). In the late 1950s a Security Service agent infiltrated the William Morris Society, an arts and culture group. The SIS is reported to have recruited Victor Wilcox, former general secretary of the Communist Party, as an informant in the 1980s, despite his expulsion from the party in 1978. During the 1981 Springbok rugby tour the SIS supplied a list of eight ‘subversives’ and seven ‘radicals not positively known to be members of subversive groups’ to Prime Minister Robert Muldoon. He published the list in an attempt to discredit the protest movement.
Pie and Penthouse
The SIS suffered public embarrassment in December 1981 when one of its agents mislaid his briefcase. The case was found by a 10-year-old boy who gave it to his mother, Fran O’Sullivan, who happened to be a parliamentary journalist. Reports stated that among the items in the brief case were ‘three cold oval meat pies, two slices of cake, copies of the latest Listener and Penthouse, three identity cards, the man’s letter of appointment to the SIS … and pages from what appeared to be a notebook’.1
In the early years of the Cold War most New Zealanders believed intelligence services were acting in the nation’s interest. However, by the 1970s civil liberties groups and many citizens were questioning the need for spy agencies in an open society. Following the Sutch case and a scandal over leaked documents, the ombudsman investigated the SIS. His report, released in 1976, endorsed the need for the service, but recommended that it concentrate on counter-espionage rather than counter-subversion. The subsequent New Zealand Security Intelligence Service Amendment Bill 1977 aimed to expand the service’s powers to intercept communications, while revising their counter-terrorism role. Critics remained bitterly opposed to the SIS, launching large-scale protests during the bill’s passage through Parliament.
Signals intelligence: the GCSB
The New Zealand Combined Signals Organisation (NZCSO) was set up in 1955. It was responsible for all signals intelligence, including the navy’s Waiōuru listening station. From 1955 to 1974 New Zealand posted signals intelligence officers to a base in Singapore. They played a significant role providing information to the military during the Vietnam War.
In 1977 Prime Minister Robert Muldoon replaced the NZCSO with the Government Communications Security Bureau (GCSB), which was responsible for communications security, technical security and signals intelligence. New Zealand acted as part of the SIGINT (signals intelligence) network, linking the USA, the UK, Canada, Australia and New Zealand.