Phone manufacturers will be required to install spyware and remove encryption without the consent of users in a security overhaul proposed by the Federal Government.

Agencies like ASIO and the Australian Federal Police will compel companies to install screen capture software on mobile phones as a way of giving agencies access to encrypted data.

Home Affairs Minister Peter Dutton says the changes are intended to crack down on criminal syndicates and terrorist operations, and phone manufacturers will only need to install software after a warrant has been issued.