The Australian Defence Association (ADA) argues in its submission to a parliamentary committee that the Office of National Assessments (ONA), which advises the Prime Minister, employs too many ex-journalists and not enough intelligence professionals.

The association, a bi-partisan think-tank dealing with national security issues, also critisised the Defence Intelligence Organisation (DIO), saying it is headed by unqualified people and plagued by too many levels of bureacracy.

However, the criticism came as a London-based international research company praised Australia for its preparation and readiness to counter terrorist attack.

The World Markets Research Centre (WMRC), which provides information on the risks of terrorism in its Global Terrorism Index for 2003-04, said it was highly impressed with the efforts of Australian companies and the government.

Its report rated Australia as the 38th most at-risk out of 186 countries in the index, but best prepared to deal with terrorist attack.

The ADA criticism was included in a report to a federal parliamentary committee which is investigating the quality of Australia's intelligence on Iraq's weapons of mass destruction.

The association's report said the current director of the DIO and most of his civilian and military predecessors had not had experience, education or training in intelligence matters.

"Most of the civilians have with highly unfortunate consequences been policy-makers transferred sideways from other departments or agencies," it added.

It also argued that the ONA's assessments of Iraq's weapons of mass destruction capability was deficient because it did not have the expertise necessary.

ADA executive director Neil James said Tuesday that a problem with the ONA is that it employs too many ex-journalists and not enough intelligence professionals.

"The main problem with ONA quite frankly was when it was set up in the late 1970s, it was only intended it would handle political and economic intelligence and the DIO would retain the primary responsibility for national level military threat assessments," James told ABC radio.

"For a variety of reasons over the years, ONA has slowly taken away a lot of DIO's role in that regard.

"As we say in our submission, we believe part of the problem that went wrong with the weapons of mass destruction assessment was just that: ONA doesn't have the capability to do the level of military assessments that are required by the country."

In London, WMRC director of research Guy Dunn said he believed the impact of the Bali bombing last year was a key factor in motivating Australian companies and the government to make good preparations for the possibility of terrorism attacks.

It found the Bali bombing, which claimed 202 lives including 88 Australians, also underlined the greater dangers Australia faced from terrorism.

Its report placed Colombia "most at risk" followed by Israel, Pakistan and the United States with Colombia and Israel as the only countries deemed at "extreme risk".

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