Federal Treasurer Josh Frydenberg has lost a two-year legal fight to hide a transcript of his interview in 2003 with police investigating one of Australia's most infamous intelligence breaches.

Key points: A top-secret report on Iraq ended up in the hands of News Corp columnist Andrew Bolt

A top-secret report on Iraq ended up in the hands of News Corp columnist Andrew Bolt Josh Frydenberg, then an adviser to Alexander Downer, was interviewed by the AFP about the leak

Josh Frydenberg, then an adviser to Alexander Downer, was interviewed by the AFP about the leak Mr Frydenberg was cleared of being behind the leak, but has tried to keep the transcript of his interview from the public

Mr Frydenberg was a senior adviser to then-foreign minister Alexander Downer when a top-secret report on Iraq was leaked to News Corp columnist Andrew Bolt.

The report was from the Office of National Assessments (ONA) and co-authored by Andrew Wilkie, who quit his role in March 2003 in protest at the Howard government's support for the US-led Iraq War.

Bolt quoted from the classified ONA report in a June 2003 article that sought to discredit Mr Wilkie, now a federal MP, who had become an ongoing thorn in the Coalition government's side.

The Australian Federal Police (AFP) launched Operation Taupe to investigate who leaked the report, likely in breach of the Crimes Act, but inquiries ended in 2005 without charges being laid.

Federal Labor MP Andrew Leigh has been pursuing the matter using Freedom of Information laws and applied to the AFP in August 2016 for all Operation Taupe documents relating to Mr Frydenberg.

Documents were released to Dr Leigh ahead of a scheduled hearing before the Administrative Appeals Tribunal.

The transcript of Mr Frydenberg's seven-minute interview with officers in December 2003 (below) showed he provided the document to the minister but denied giving it to Bolt.

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"I did not provide anything in terms of the document, [a] briefing on it, or information on it to anybody else," he told investigators.

Mr Frydenberg last night told the ABC the pursuit of the document was down to Labor playing politics.

"This is a muckraking exercise by Labor over events 15 years ago that were fully investigated at the time," he said.

"There is nothing new and nothing to add."

Dr Leigh said voters deserved to know more about "one of the most serious national security breaches in Australia".

"It's absolutely vital that the leaker of this top-secret document is exposed and is punished appropriately," he said.

"There ought to be no place to hide for people who are so cowardly as to leak national security documents."

Labor MP Andrew Leigh says Mr Frydenberg should not fight the release if he has nothing to hide. ( ABC News: Nick Haggarty )

Frydenberg cleared of leaking report

On Friday June 20, 2003 Josh Frydenberg and colleague Craig Maclachlan agreed they should ask the ONA for the document, titled 'Current Assessment Iraq: Humanitarian Dimensions'.

The pair told federal agents the request was sparked by Mr Wilkie's appearance before a UK Parliamentary committee looking at the Iraq conflict.

The following day, Mr Frydenberg sent the report to Mr Downer's home fax machine.

On Monday June 23, 2003, Bolt's story appeared under the headline 'Spook Misspoke' and quoted from the ONA report.

"Andrew Wilkie sells himself as the spy who couldn't be fooled over Iraq. He's the one spook who didn't buy what he calls the Howard Government's 'fairytale' and 'exaggerations' about the threat of Saddam Hussein. But when I go through the only secret report that Wilkie ever wrote about Iraq as an Office of National Assessments analyst, I wonder just who fell for a 'fairytale'."

The AFP concluded there was "no direct and probative evidence that would give reasonable cause to believe the document requested … on 20 June 2003 was the source used in the Andrew Bolt article".

Police obtained telephone records for Mr Frydenberg's mobile and landline services and found nothing linking him to Bolt around the time the story appeared.

The transcript shows Alexander Downer asked Mr Frydenberg to fax the top-secret ONA report to his home. ( AAP: Lukas Coch )

In the interview transcript, Mr Frydenberg admitted sending the document to Mr Downer's unsecure home fax in Adelaide, despite knowing that could breach the rules around handling the classified document.

"The foreign minister had asked me, had instructed me to send it to him so I couldn't — I obeyed his instructions," he told police.

The Treasurer now sits on the powerful National Security Committee of Cabinet, which deals with intelligence matters and major security issues.

"If you can't handle national security documents, then there's a question as to why you should be sitting on the National Security Committee," Dr Leigh said.

"Not following proper procedure when it comes to handling top secret documents is serious wrongdoing."

The AFP said 84 copies of the report had been distributed among ministers and the public service.

Police found mishandling of their report had been widespread, despite it being classified top-secret and marked 'AUSTEO' (for Australian eyes only).

The report was co-authored by Andrew Wilkie, a former intelligence officer who is now a federal independent MP. ( ABC News: David Hudspeth )

Release 'can only cause detriment', argues Frydenberg's lawyer

Dr Leigh has sought a range of documents from the AFP since April 2015 when Mr Frydenberg was his opposite number in Parliament as assistant treasurer.

In that year, Mr Frydenberg engaged Melbourne law firm Arnold Bloch Leibler to help him fight the release of material under FOI.

The firm's senior partner Leon Zwier argued releasing the latest cache of documents was an "unreasonable disclosure of personal information" and "our client's right to privacy weighs heavily".

"To release the transcript of interview … and the deliberative thoughts of an AFP officer … can only cause detriment to our client as it will enable a forensic analysis to be undertaken of which staff member said what in response to interview questions," Mr Zwier wrote in September 2016.

He claimed the material "may be used to unfairly prejudice our client even though he fully cooperated with the interview process and gave honest, direct and truthful answers".

Peter Dutton's chief of staff Craig Maclachlan (right) was also interviewed by AFP officers. ( ABC News )

It is not clear whether Mr Zwier was engaged by Mr Frydenberg privately or paid for by taxpayers.

Dr Leigh claimed "hundreds of thousands, possibly millions" of dollars in public funds had been spent fighting the release of documents over three years.

"If the Government had nothing to hide, then they shouldn't have been fighting against the disclosure of this information for many years," he said.

The documents also include a case note from October 2003, which reveals that Mr Maclachlan, who is now Home Affairs Minister Peter Dutton's chief-of-staff, was also interviewed by the AFP.

He worked in Mr Downer's office as a department liaison officer and Middle East adviser.