Houston was invited to give his thoughts and recollections to the inquiry on the deployment of allied forces to Afghanistan.
Houston, who said he made around visits to Afghanistan as Australian Chief of Defence Force, told the hearing the single biggest setback to operational success there was civilian casualties.
"By far and away it is the innocent civilian population that has suffered the most in Afghanistan. For every new well put in, new school opened or road paved, the death of a civilian put the cause back," he said.
Each death also potentially created five or 10 more insurgents, Houston said.
"Within our own planning processes and then again within the ISAF [nternational Security Assistance Force] operational approval process, the protection of civilians and the prevention of civilian casualties were critical components.
"Personally, I can attest to our command chain not permitting some operations and actions because the potential risk for civilian casualties or damage to civilian properties or infrastructure was too great."
Houston said there were very few set battle pieces and no demarcated front lines.
"Quite literally a soldier could be standing beside someone in an Afghan village who,
hours or days later, might take up arms against him."
The Joint Prioritised Effects List (JPEL) was the process through which military commands and staff prioritised their efforts and resources.
It was a very formal, highly oversighted and controlled process, which sought to ensure that targets were legitimate and lawful, Houston said.
"The process and requirements were rigorous and sometime restrictive. In this regard there was a requirement imposed on our forces to confirm at a set interval that the particular target listed on the JPEL still met all the criteria – that is, the target was still active in fighting against the Afghan government and ISAF."
The JPEL also helped coalition forces separate the insurgents from the broader population in a "chaotic and ambiguous environment".
Houston also explained the Rules of Engagement (ROE), which govern a nation's military force.
"In my experience the formulation, drafting and authorising of ROE for our deploying forces was one of the most complex, considered and scrutinised processes. There was input from lower level commanders, military and civilian legal officers, policy officers, senior military officials and indeed Government," Houston said.
The Government announced in April last year that an inquiry into Operation Burnham and related matters would be held.
The inquiry aims to establish the facts in connection with the allegations, examine the treatment by the NZDF of the reports of civilian casualties and look at the conduct of NZDF personnel forces.
A small but peaceful protest was held outside the hearing this morning. Placards and chalk-drawn messages on the pavement claimed civilian deaths in the SAS operation. As the hearing got under way, a handful of people in the audience held up small signs before leaving.
