Encrypted communication services like WhatsApp need to hand over messages when asked or it will be harder to catch terrorists, Home Affairs Minister Peter Dutton says.
Mr Dutton provided the bleak outlook on Wednesday as he pushed for laws forcing tech giants to hand over encrypted information to police.
He acknowledged encryption was a "significant and necessary" tool for people using internet banking or dealing with the tax office.
"(But) terrorists and criminals are using encrypted communications to avoid detection and disruption," Mr Dutton told the National Press Club in Canberra.
"It makes the task of conducting an investigation - to say nothing of disrupting terror attacks or criminal activity - more difficult than it has ever been."
Nine in 10 national security investigations are being impeded by the use of encryption services like WhatsApp, Wickr and others, authorities say.
Mr Dutton argued the legislation would not force the creation of "back doors" in messaging applications or force service providers to weaken their security measures.
He pointed out multi-billion dollar Silicon Valley companies were among the loudest critics of the new laws.
"It is important tech firms understand and embrace their responsibilities to our community that has helped enrich them and their companies and shareholders," Mr Dutton said.
Under the legislation, companies would be both compensated by the government and afforded immunity from legal action for providing encrypted data.
Companies could either voluntarily hand over information to security agencies or be forced to after receiving a notice from either the director-general of security or the attorney-general.
But tech companies have told a Senate inquiry they will have to break their encryption or insert backdoors into their systems in order to comply with the new laws.
Mr Dutton did not address questions about how companies could comply with the laws, or whether there would be judicial oversight of the system.
He called on the opposition to stop "playing games" and support the legislation.
Labor communications spokeswoman Michelle Rowland said in a speech on Tuesday that her party was committed to protecting national security and enabling law enforcement operate effectively.
But she said it was also critical Australians had confidence proper privacy safeguards and transparency measures were in place.
The laws include penalties of up to 10 years' jail for failing to hand over information when a warrant is in place and the data is linked to a serious crime.