2000 Public Report

Table of Contents

• Foreword
• Part I: Global Security Environment
  • CSIS Security Intelligence Interests
• Part II: Counter-Terrorism
  • Terrorism Today
  • Disturbing Trends
  • Cooperation
  • International Convention for the Suppression of the Financing of Terrorism
• Part III: Counter-Intelligence
  • Intelligence Activities
  • Transnational Criminal Activity
  • Economic Security
  • Information Operations
• Part IV: Analysis and Production
  • Reporting Responsibilities
  • Government Liaison
  • Overview
• Part V: Security Screening
  • Immigration and Citizenship Screening
  • Government Screening
  • Liaison Relationships
• Part VI: Resource Summary
  • Human and Financial Resources
  • Challenges

Foreword

Effective security is often defined by constraints of secrecy and the "need-to-know" principle. Ten years ago, the Government of Canada honoured a commitment to provide Parliament and the Canadian public with more information about the national security system. Responding to a statutory review of the Canadian Security Intelligence Service Act, the first Public Report of the Canadian Security Intelligence Service (CSIS) was tabled in the House of Commons by the Solicitor General of Canada.

The government's commitment recognized the need for increased knowledge about the mandate of CSIS, in conjunction with the domestic and international security intelligence environment. It was acknowledged that appropriate legislative control and accountability, as well as the safeguarding of national security with due respect for individual rights and freedoms, can only be maintained by a better understanding of the "purposes and processes" of the Service. Further, the Report drew attention to the contribution made by the Service as a protector of Canadian national security.

The first CSIS Public Report presented an overview of the Service's operating environment and an explanation of how intelligence is provided for government decision-makers. Throughout the intervening years, successive Public Reports have continued to build on that foundation with the several-fold aim of improving public awareness of the role of CSIS, the changing security environment, and the ability of CSIS to respond with flexibility to such changes. In conjunction, many popular myths have been addressed in an endeavour to "demystify" the world of security intelligence.

Among the more significant challenges continuing to face the Service in this era of globalization are the needs to perceive evolving threats, and to understand their meaning for the security interests of Canada. Many of Canada's security preoccupations originate abroad, making it imperative to identify and comprehend developments which could become "homeland issues" for residents or citizens of Canada who belong to one of Canada's ethnic communities. CSIS must ensure that Canada does not become the originating country for the support or direction of an incident abroad. As well, a small number of domestic concerns also demand the attention of the Service.

Traditional and emergent issues occupy the Service in both the areas of public safety and national security. Threats to public safety, still considered to be the highest priority of the Service, are the responsibility of the Counter-Terrorism Branch, while threats to national security related to intelligence activities of foreign governments, as well as threats to Canada's social, political, and economic infrastructures, are investigated by the Counter-Intelligence Branch. Economic issues and cyber- based threats to the infrastructure are among the increasingly complex modifications to the security intelligence environment with which CSIS must contend.

Within the CSIS mandate is the important responsibility to forewarn and advise government of threats to the security of Canada. Largely the task of the Requirements, Analysis and Production Branch, a broad range of reports are produced in both classified and open-source formats. In keeping with the government's commitment to transparency, the CSIS Internet Web site is a cost-effective and increasingly popular means of providing relevant open information about the Service's mandate, programs and activities. Readers seeking further knowledge and data about public safety or national security issues may consult the Web site at www.csis-scrs.gc.ca.

Security Screening is also part of the program to warn government of individuals that present a threat, and to help ensure effective consultation sharing with other departments and agencies. Both the provision of security advice in immigration matters and security assessments for protecting government assets are crucial to countering threats to the security of Canada.

Timely and accurate intelligence requires the Service to constantly monitor, analyze and address various threats and to continually reassess priorities. The outcome places a heavy demand on resource levels, necessitating selective and precise assignment to major threats and emerging issues. CSIS must ensure that it has the technical and human capability to respond to the challenge with the essential tools of comprehensive investigation for effective national security.

Part I: Global Security Environment

International terrorist networks, a primary source of terrorism today, continue to present important global security implications. The advent of modern communications methods, combined with the ease of international travel, exponentially expands terrorism's scope of operations. One of the prime motivators of contemporary terrorism is Islamic religious extremism, at the forefront of which are Sunni extremists. The magnitude of the Sunni extremist threat was exemplified by the 1993 World Trade Center bombing, intended to cause upwards of 35,000 casualties. Another example is the 1998 bombings of US embassy buildings in Dar es Salaam and Nairobi, which killed over 270 people and injured 5,000 others.

Evidence of politically motivated violence in Canada remains largely associated with the extension of foreign conflict, making it imperative that Canada does not become the country of origin of a terrorist incident abroad. The challenge for CSIS and government lies in preventing homeland issues from becoming domestic security problems, potentially placing Canada in the middle of an incident with international repercussions. Consequently, public safety remains the highest priority of the Service. Developing and maintaining a knowledge base of explosive issues and regions requires skilled analytical and investigative resources. As a direct result of the current threat environment, the Service now needs to know and understand the significance of developments in far-flung regions of the globe such as sub-Saharan Africa, Azerbaijan, Yemen, and well-established locations such as Europe, the Middle East and the United States.

The proliferation of weapons of mass destruction, by countries seeking to acquire nuclear, biological or chemical weaponry and related delivery systems, continues to be a leading international concern. Certain countries lacking the indigenous capability to develop and produce their own arsenal often attempt to procure critical components, technology, and expertise from the developed countries of the West. Despite several international supplier regimes and cooperative agreements designed to control the transfer of technology and materials for weapons of mass destruction, some restricted countries have been successful in acquiring integral components and expertise. In addition to the threat related to North Korea's development of weapons of mass destruction, and its willingness to distribute such weapons, is Iran, Iraq and Libya's ongoing determination to bypass international agreements for weapons development control.

The need for Canadian involvement in resolving foreign conflict has accelerated over the past decade, resulting in broad implications for national security. Canada's increasing military and political roles in world events, such as peacekeeping missions to Bosnia, Somalia, Rwanda, and Kosovo, have augmented the country's visibility, as have involvements in military action against Iraq and Yugoslavia. International institutions and bodies, peacekeeping missions and major international events are all potential targets for terrorists. Canada's open society and prominence in technological fields make attractive grounds for coordinating terrorist support activities and acquiring proprietary information and technology. Canada remains a world leader in accepting refugees and immigrants, and will continue to receive a steady flow of people from some regions torn by conflict.

Mass migration, combined with the growth of transnational criminal activity, remains a security concern. As interstate conflicts rise, the number of displaced peoples as well as political and religious refugees also grows, bringing with it social, economic, political and, therefore, security challenges. Migrant smuggling continues to be a lucrative commodity for transnational criminal groups. Attempts to manipulate or undermine the integrity of affluent countries' immigration systems persist.

Developments in the Middle East arena during the last months of 2000 effectively halted the peace process. Spillover from the escalation of the Palestinian-Israeli clashes was felt within communities around the world. Conflict in the West Bank and Gaza has returned to the forefront and reached a level of danger more substantial than any since the 1973 Arab-Israeli war. The risk of escalation remains high and a danger exists that violence and instability could spread beyond Israel and the Palestinian territories. Relations between Israel and other countries in the region, including its largest Arab neighbour, Egypt, have been significantly affected by these events.

The situation in the Federal Republic of Yugoslavia will continue to be of particular interest as the United States and Europe force the new leadership to address future prospects for Kosovo and the resolution of war crimes issues, particularly those associated with former President Milosevic. In Bosnia, crime and corruption are affecting the prospects of a viable economic system, while lingering inter-ethnic problems plague southern Serbia.

China is struggling to become a major world power, though most sectors of its society are supported by third-world infrastructures. High and rising unemployment, crime, corruption, and challenges to Beijing's authority, such as the Falun Gong, as well as religious and ethnic minorities, represent short- to medium-term destabilizing factors. A perceived rise in Japanese militarism and American support for Taiwan are also troubling for Beijing. Northeast Asia is expected to become a focal point in the escalating tensions over military activity in the incremental positioning among leaders in Eurasia. South Korea, for instance, has announced plans to enhance its military capability to defend against threats beyond those from North Korea. As well, North Korea's continued development of longer range ballistic missiles and their sale to other countries remain troubling.

The protracted Indo-Pakistani conflict over Kashmir, featuring periodic open warfare and Pakistan-backed insurgent activity, continues to be a major concern. Pakistan's endorsement of the Kashmiri militant movement ensures the continuance of conflict along the Line of Control. As well, Pakistan's long-standing support of the Sikh extremist issue is a major factor in its endurance. The effects of ongoing support by Pakistan's intelligence apparatus of the Jammu and Kashmir conflict, with its growing linkage to the Taliban, have spilled over into east-Asian expatriate communities around the world.

Uncertainty in Northern Ireland continues. The devolution of power to Northern Ireland from Britain in December 1999 came to an end in February 2000, when mainstream Irish republican and loyalist terrorists failed to begin decommissioning their weaponry. While efforts are being made to resolve the issue of decommissioning, Irish republican dissidents are attempting to commit acts of terrorism in the Republic of Northern Ireland and in England.

Prospects for Africa hinge on the continent's severe security problems. Solvent and functioning African states are expected to intervene militarily to control insurgencies that either threaten neighbouring countries or harbour dangerous elements, such as terrorist groups and radical fundamentalist movements. Africa will continue to require investment in international peacekeeping and global humanitarian or, potentially, military intervention.

Conducting timely investigations into threats to national security requires effective collection and analysis. CSIS has approached the challenges presented by limited human resources, crucial exchange relationships, and shifting threat priorities by the judicial use of risk management and flexibility. The Ahmed Ressam arrest and associated events of late 1999 underscored the continuing requirement for the Service to review its efficiency within the context of the existing threat environment, with particular emphasis placed on the allocation of human resources.

An example of the wide range of security issues of concern to the Service, the emerging phenomenon of anti-globalization is demanding increasing attention. Meetings of international monetary, trade and environmental organizations, which in the past incited little or no protest interest, are now the focus of thousands of activists. Representing a broad spectrum of groups, lobbyists, and overlapping networks, including a limited number of violent extremists, they share a mutual antipathy for multinational corporate power. Large corporations with international undertakings stand accused of social injustice and unfair labour practices, as well as a lack of concern for the environment, mismanagement of natural resources and ecological damage.

Protest objectives extend beyond the claimed corporate impropriety. Multinational economic institutions, such as the World Trade Organization (WTO), the World Bank (WB), and the International Monetary Fund (IMF), are seen as establishing, monitoring, and rendering judgments on global trade practices, and are viewed as the spearheads of economic globalization. These institutions, considered to be the servants of corporate interests, exercising more power than elected governments and interested only in the profit motive, have increasingly become principal demonstration targets. Underlying the anti- globalization theme is criticism of the capitalist philosophy, a stance promoted once again by left-of-centre activists and militant anarchists.

The global parameters have encouraged disparate groups and individuals to participate in the demonstrations. Circumstances also have promoted the involvement of fringe extremists who espouse violence, largely represented by Black Bloc anarchists and factions of militant animal-rights and environmental activists. The melding of various elements and establishing of strange-bedfellow ties at individual demonstrations have contributed both to the impact and the unique character of events.

Creating the foundation for dramatic change, the Internet has had a profound impact and will continue to play a large role in the success or failure of globalization protests and demonstrations. Individuals and groups are able to identify and publicize targets, solicit and encourage support, establish dates, recruit, raise funds, share experiences, accept responsibilities, arrange logistics, and promote goals in a manner that would have been impossible to manage readily and rapidly in the past.

A principal factor currently underlying all security issues is the impact of technological change. The reliance of modern countries on the unimpeded and secure flow of information electronically has created vulnerabilities within their information infrastructures that are serious enough to raise international security concerns. The already complex investigation of threats posed by terrorism and intelligence activity is further complicated by the adoption of cybertechnology by foreign intelligence organizations and terrorist groups. The rapid evolution of technology relating to computer-based communications and encryption is challenging the capacity of intelligence services around the world to lawfully intercept communications and gather intelligence. Government departments, intelligence and enforcement organizations, military forces, and the private sector in a variety of countries worldwide, are trying to determine what threats and risks exist relating to their dependence on computer-based systems and networks. The United Nations, the WTO, the Council of Europe and the G-8 are among a range of institutions concerned with the issue of cybercrime.

Technology, particularly in the telecommunications sector, is advancing at an unprecedented pace and shows no sign of abating. New technology is readily available, affordable and used by Service targets. Failure to remain current on leading- edge technology hampers the Service's ability to monitor and investigate threats to national security. Like its allies, CSIS is meeting this challenge through early identification of operational technology requirements, research and development, and through collaboration with its domestic and foreign allies.

CSIS Security Intelligence Interests

The Service's public safety and national security interests in the changing global environment may be summarized as follows:

• public safety from the effects of terrorism;
• the clandestine activities of foreign intelligence services;
• the inviolability of expatriate communities;
• the proliferation of weapons of mass destruction, including nuclear, chemical and biological weapons;
• transnational criminal activity;
• the security of critical information systems and of the social infrastructure;
• the vulnerability of Canada's economic interests;
• effective security screening;
• the security of classified or proprietary public or private information;
• relationships with foreign intelligence agencies;
• maintaining technical capabilities in a rapidly changing environment.

In pursuit of these interests, CSIS works cooperatively with the appropriate government departments and agencies, and with the intelligence services of other governments, to counter threats to public safety and national security.

Part II: Counter-Terrorism

Terrorism Today

The primary source of modern politically motivated violence, international terrorism, carries important security implications for Canada and its allies worldwide. Advanced communications techniques, combined with the ease of international travel, have broadened terrorism's scope of operations, while greatly compressing the time frames available to security forces to detect and neutralize terrorist threats. Individuals with links to international terrorist groups use foreign countries, including Canada, as a base to plan terrorist acts and provide logistical support for terrorist activities in their country of origin or against other target nations. In Canada, supporters of terrorism engage in fundraising, planning operations, and transferring money and matériel overseas. The security and intelligence community is increasingly challenged by emerging threats which include the potential use of nuclear, chemical, biological or radiological materials by a terrorist group, cult or individual. In light of the potential consequences of a mass-casualty attack, Canada and its allies continue to explore and develop inter-agency emergency responses to this threat.

Canada belongs to international institutions and bodies, participates in peacekeeping missions and hosts major international events, all of which are potential targets for terrorists. Canada remains a world leader in accepting refugees and immigrants, and will continue to receive a steady flow of people from regions of strife. Some will bring the politics of conflict with them. For Canada, politically motivated violence remains largely an extension of overseas discord. Individuals with links to international terrorist groups use Canada primarily as a base from which to orchestrate terrorist activities abroad. The intelligence services of certain foreign governments continue to be active in Canada, targeting dissidents associated with long-standing regional or political conflicts and residing within Canadian expatriate communities.

While state-sponsored terrorism continues to pose a significant threat, one of the prime sources of terrorism today is Islamic extremism, as exemplified by Osama bin Laden. At its forefront is a sophisticated, international network made up of terrorists who are better trained, more security conscious, less predictable than ever and who are well financed and highly independent, yet willing to operate within temporary alliances of convenience when advantageous. They are united in their commitment to use serious violence to effect political change and are willing to attack soft targets anywhere in the world.

In addition to the foreign-based threat, Canada is confronted to a much lesser degree by domestic militancy related to Aboriginal extremism, White supremacists, and extremists linked to militia, sovereignty, animal-rights, and environmental issues.

Disturbing Trends

Terrorism in the years ahead is expected to become more violent, indiscriminate, and unpredictable than in recent years. The use of advanced explosive materials, in combination with highly sophisticated timers and detonators, will produce increasingly higher numbers of casualties. There will likely be terrorist attacks whose sole aim would be to incite terror itself. A hardening attitude and a willingness on the part of certain terrorist organizations to directly support terrorist operations in North America reinforce the belief that Canadians, now more than ever, are potential victims and Canada a potential venue for terrorist attacks.

Computers, modems, and the Internet are enhancing the operational capabilities of terrorist organizations. Terrorists have improved their use of advanced technologies to protect and expedite lines of communication, control, and funding both nationally and internationally; this has increased the chances that planning for the next terrorist attack may not be detected. Terrorists also have augmented their security through the use of sophisticated encryption software to protect sensitive communications.

Cooperation

The Service, in partnership with Citizenship and Immigration Canada, the Department of Justice Canada, the RCMP and the Canada Customs and Revenue Agency will continue to use inadmissibility provisions in the Immigration Act to strategically target and deport key members of terrorist organizations in order to impede their mobility and to impair their ability to operate here. At the international level, while Canada's commitment to combatting terrorism manifests itself regularly within such forums as the G-8, the Organization of American States, and the United Nations, the Service's bilateral and multilateral cooperative efforts with other security and intelligence agencies serve to minimize the number of terrorists who take up residence here.

International Convention for the Suppression of the Financing of Terrorism

The curbing of terrorist fundraising is an integral component of Canada's international efforts to combat terrorism. The United Nations Sixth Committee Working Group, under Canadian chairmanship, successfully concluded negotiations on the International Convention for the Suppression of the Financing of Terrorism on October 8, 1999. In addition to chairing the negotiating committee, Canada was instrumental in helping to resolve a number of important issues.

The Convention was adopted by the UN General Assembly on December 9, 1999, and was opened for signature on January 10, 2000. The Convention is intended to complement existing counterterrorism conventions, and aims to curb terrorist acts by restricting terrorists' sources of funding, as well as by defining new offences under international law to close gaps currently used in counterterrorism legal cases. The new definitions criminalize the provision or collection of funds used, or intended to be used, to carry out terrorist acts.

The Convention also provides for the civil, criminal or administrative liability of legal entities for offences committed. Finally, the Convention allows for the incorporation of relevant offences that might be identified in subsequent counterterrorism treaties.

Canada has promoted international co-operation to fight terrorist fundraising in meetings such as the 1996 G-8 Ministerial meeting in Paris, and the 1998 G-8 Summit in Birmingham. Canada will continue to strongly support measures and obligations that fight terrorist fundraising and strengthen the international legal regime against terrorists and their sources of funding.

In addition to Canada's role in creating the Convention, Canada has signed all 12, and ratified 10, of the existing international counterterrorism conventions. Canada continues in its efforts together with its allies in such organizations as the G-8 and the Organization of American States.

Part III: Counter-Intelligence

Intelligence Activities

The intelligence services of certain foreign governments continue to clandestinely collect information considered to be in their national interest, and to engage in foreign-influenced activities within émigré communities. Intelligence officers of these foreign governments have been directed to collect information injurious to Canadian national security with respect to issues such as trade negotiations, military and technological developments, and other information classified in the national interest. CSIS anticipates that some of these intelligence services will expand their current intelligence collection activities; considering their aggressive stance, an increased threat to Canadian interests is forecast.

Canada is committed to international agreements for the control of weapons of mass destruction, and participates in a number of multinational forums such as the Australia Group, the Nuclear Suppliers' Group, the Missile Technology Control Regime, and the Wassenaar Arrangements. The Service has a role to collect intelligence related to hostile foreign governments' biological, nuclear, and chemical weapons development programs and their delivery systems, and plays an integral role in supporting collective agreements.

Transnational Criminal Activity

Transnational criminal activity (TCA) has become a global problem. The scope and extent of TCA means that no country is immune to the threat it poses; most countries now consider that some aspects of global TCA can threaten their national and economic security. TCA organizations can undermine the integrity of public and private institutions, adversely affect financial markets and the banking sector, and threaten key sectors of national economies.

Canada considers that the threat posed by TCA is significant both as a public safety and as a national security issue, and CSIS contributes to the broader government effort in fighting organized crime.

Economic Security

The Service investigates clandestine, deceptive, and coercive activity carried out or facilitated by foreign governments and aimed at accessing Canadian proprietary information or technology. CSIS has identified several sectors of the Canadian economy considered to be sensitive and likely targets of foreign interest, including: aerospace, biotechnology, chemicals, communications, information technology, mining and metallurgy, nuclear energy, oil and gas, and the environment. Investigations have determined that Canada's economic interests are vulnerable to the clandestine collection of economic intelligence by a small number of states using individuals from the following groups: visiting foreign students, scientists, exchange personnel, delegations, business personnel and members of émigré communities in Canada.

A number of foreign governments, including some of Canada's allies and trading partners, direct their state-owned corporations and intelligence services to engage in economic espionage against Canada. The Service's Liaison and Awareness Program is directed at cautioning industry and government departments in an attempt to limit loss of technology and proprietary information. Such losses are detrimental to Canada's foreign policy, defence, and economic interests. The program provides information about participants, motives, and the means which play a part in a foreign government's economic espionage activity.

Information Operations

The reliance of modern countries on information infrastructures (interconnected networks of computers and telecommunications equipment) has created vulnerabilities serious enough to trigger national security concerns. Canada's increasing dependence on these critical information infrastructures creates new and uncertain vulnerabilities with respect to cyberterrorists, foreign intelligence services or politically motivated extremists. Recent "public" attacks such as the "I Love You" virus demonstrate the vulnerability of interconnected systems, and the potentially devastating impact that such attacks and intrusions can have. The Prime Minister's announcement of a new agency, the Office of Critical Infrastructure Protection and Emergency Preparedness, has clearly demonstrated Canada's determination to meet the range of growing security requirements.

CSIS recognizes the emerging challenge to national security and is monitoring and investigating the rapidly evolving threat posed by information operations. The Service works with other members of the Canadian security and intelligence community, while continuing to liaise with law enforcement agencies and allied intelligence services.

Part IV: Analysis and Production

Reporting Responsibilities

The primary mandate of CSIS is to collect and analyze information, and to report to and advise the government on threats to the security of Canada. Within those parameters, the reporting function of the Requirements, Analysis and Production Branch (RAP) plays a key role in the intelligence process. Policy- makers rely on security intelligence reports, such as the Director's Annual Report to the Minister, which are prepared by RAP analysts from a broad range of both open-source and classified information.

RAP analysts use their knowledge of regional, national and global trends to assess the quality of all types of information gathered, and to organize it into useful security intelligence products. CSIS Reports, Studies, and Current Intelligence Briefs address a variety of issues, providing government with up-to-date information in keeping with the assessment and advice requirements contained in section 12 of the CSIS Act.

In conjunction with classified reporting, the Branch is also responsible for the production of open-source material. RAP introduced its first new unclassified intelligence product, Commentary, in 1990. Written by academics and members of the intelligence community on topics of current security interest both to the community and an interested public, the Service has produced 79 editions of Commentary during the past decade. A second, similar publication was initiated in 2000. Perspectives is designed as a vehicle for the Service's analysts to examine specific issues with a potential to constitute threats to the security of Canada.

Both the Commentary and the Perspectives series take advantage of the vast amount of open information on issues of security concern and attempt to distill it into a concise discussion of value to intelligence professionals, clients in other departments, and the informed reader in the general public. CSIS has a Web site on the Internet which posts unclassified products, including the CSIS Act, the Public Report, as well as the Commentary, Perspectives and the Backgrounder series.

Government Liaison

As well as representing CSIS at meetings of the intelligence community, the Branch maintains a government liaison program. RAP client liaison officers meet with security officials and program officers in other departments and agencies to review individual intelligence requirements and to seek feedback on CSIS products. This program has proven an invaluable means to increase understanding within the Service about changing intelligence requirements, particularly those of departments outside the core security and intelligence community. Conversely, government liaison increases awareness of the scope and value of CSIS intelligence products.

Overview

As an agency with a mandate to report to and advise government on threats to the security of Canada, and the concomitant responsibility to protect confidential sources, CSIS will always be constrained in commenting publicly on its activities. Nevertheless, the requirements, as stated in the CSIS Act, are driving a process reflecting what Parliament intended when it passed the legislation creating the Service. The government and public liaison initiatives which CSIS has developed, and which not so long ago were unthinkable for an intelligence service, are now accepted as the norm.

Part V: Security Screening

Security Screening is one of the more highly visible Service programs. It is a vital component of the Canadian government's security regime with respect to public safety and economic security. Security Screening remains the Service's first line of defence for preventing persons of security concern from entering this country, and for providing security assessments for individuals requiring access to classified information and assets. In order to respond to security screening responsibilities, the Service continues to foster partnerships with the government sector. It also relies on cooperation with agencies abroad. In the global security environment, where political and ethnic turmoil continues to rate high on the scale of threats, the Service maintains its leading edge in screening expertise through the identification of international and domestic security trends to ensure the delivery of an effective program.

Three key components of the program are: Immigration and Citizenship Screening, Government Screening and the Liaison Relationships.

Immigration and Citizenship Screening

In the next few years, Canada is committed to increasing the number of refugees and immigrants that will be allowed entry to our country. A comprehensive immigration screening program is essential to prevent those who would be detrimental to Canada's security and national interests from entering Canada and obtaining landed immigrant status. The provision of security advice in immigration and citizenship matters is therefore crucial to counter the proliferation of threats to the security of Canada and North America as a whole. As we face an exponential increase of immigrants and visitors, the likelihood is greater that terrorists and individuals connected with hostile intelligence agencies will attempt to capitalize on the unstable environment abroad to gain entry into Canada.

Government Screening

The task of Government Screening is twofold: to protect classified information and assets and to prevent unauthorized access to sensitive government sites. The Service contributes to this program by conducting background investigations, and by providing security assessments, so that individuals involved in terrorist or hostile foreign intelligence activities do not have access to classified material or sites.

Liaison Relationships

An essential tool in the investigation of threats from terrorism and foreign intelligence activity is the exchange of information with foreign agencies. As of March 31, 2001, the Service has 223 arrangements in place with agencies from 130 countries. This also includes arrangements with four international organizations.

Part VI: Resource Summary

Human and Financial Resources

The charts on page 17 illustrate the changes in CSIS human resource levels since the inception of the Service, as well as the financial resource levels over the past 10 years. The government's restraint program and Program Review exercises have significantly affected the Service's resource levels. Between 1992 and 1998, the Service's staff was reduced by 760, or 28%, and the Service's operating budget also decreased significantly.

As indicated by the Human Resources chart, the impact of Program Reviews and other reductions brought the Service's human resource level down to 2000 Full-Time Employees (FTEs) in 1997/1998. The decrease in construction capital shown on the budget chart reflects the declining level of funding related to the construction of the national headquarters building, which was completed in 1995/1996.

CSIS assumed responsibility for the security screening of employees of the Department of National Defence (DND) in 1998. As a result, since fiscal year 1998/1999, the Service's budget has been augmented by the transfer of resources from DND. This ongoing resource increase covers salary and operating costs for the provision of security screening services. The Service also has received additional resources for its security screening program to cover new responsibilities related to immigrant and refugee security assessments.

Increases occurred in operating budget resources in fiscal year 1999/2000, mainly due to Year 2000 requirements. Significant financial and human resources were devoted to ensuring that the Service's critical application systems were Year 2000 compliant. Increased expenditures in fiscal years 1998/1999 and 1999/2000 reflect the incremental costs associated with this initiative.

In conjunction with certain other government institutions, CSIS received in 2000 five-year funding to address technological challenges facing the security and intelligence community.

Challenges

CSIS can now make appropriate investments in a coordinated research and development effort to keep pace with the changing technological environment as it relates to threat activity, but the Service is increasingly challenged by emerging threats. Up to now, CSIS has been able to risk-manage the challenges. However, the terrorist events of late 1999 underscored the continuing requirement to review efficiency within the context of the existing threat environment, with particular emphasis on the allocation of human resources. More than ever, the Service must rely on risk management, concentrating resources selectively and precisely on the major issues, while assessing new and emerging threats.

Figure 1 long description

Figure 2 long description

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Public Contact

For more information, please contact:

Candian Security Intelligence Service
Communications Branch
P.O. Box 9732
Postal Station T
Ottawa, Ontario
K1G 4G4

613-231-0100 (Communications)

Cat No. JS71-2/2001

ISBN 0-662-65439-0