Howard plans regional spy school

Mr Howard has stressed the terrorist threat

Australian leader John Howard has put national security back onto the election agenda by announcing plans for a regional spy school.

The A$20m centre would train Australians and its neighbours, if Mr Howard wins this Saturday's poll.

Mr Howard has repeatedly stressed that Australian interests could again be targeted in a terrorist attack.

The latest opinion poll shows him slightly ahead of his main rival, Labor leader Mark Latham.

Results released on Monday from a survey by market research firm ACNielsen gave Mr Howard's conservative coalition 52% of the vote, compared to Labor's 48%.

Foreign policy is just one of the issues that sharply divides Mr Howard and Mr Latham. The latter has pledged to pull Australian troops out of Iraq by Christmas, while the prime minister has said he will continue to support the US-led coalition.

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The dispute has also prompted questions as to whether Australia's commitment in Iraq has made it more vulnerable to terrorist attack.

Australian nationals have already been attacked by regional militants. Eighty-eight Australians were killed in the 2002 bombing in Bali, and a car bomb exploded outside Australia's Jakarta embassy last month, killing nine Indonesians. Both attacks were blamed on South East Asian Islamic group Jemaah Islamiah.

"Timely and credible intelligence is the best defence against terrorism and effective co-operations with our regional neighbours in intelligence sharing is critical to our national security," said Mr Howard.

The Centre for Counter-Terrorism Co-operation and Joint Intelligence Training will oversee the deployment of Australian spies in the region and also host foreign intelligence agents.

Mr Howard also pledged to increase mock terrorism exercises and to boost the powers of Australia's intelligence chief.

But while security is a key issue, correspondents say the economy looks set to be the ultimate deciding factor in the election race.

"What I am saying to those people listening to this program who are undecided (is) we have fulfilled your trust by delivering the strong economy, the low interest rates, the high employment, the higher real wages and the taxation reform, the industrial reform, all of those things," Mr Howard told ABC radio on Monday.

Labor, for its part, has stressed the need for extra spending on health and education while keeping the budget in surplus.