Basically, the law legalizes hacking of accounts of those suspected of wrong activities – and the modification of data therein (effectively tampering with potential evidence):
The bill updates the Surveillance Devices Act 2004 and Telecommunications (Interception and Access) Act 1979. In essence, it allows law-enforcement agencies or authorities (such as the Australian Federal Police and the Australian Criminal Intelligence Commission) to modify, add, copy or delete data when investigating serious online crimes.
This also enables the government to act against third parties, whose communications may be identified in conjunction with investigations.
Fortunately, we know the government would never abuse these powers. The NSA never collected private communications of American citizens. Ever.