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Prime Minister Tony Abbott made the announcement on Australia Day, almost a year after reintroducing the honours.
Mr Abbott said the honour for Air Chief Marshal Houston would recognise his "extraordinary and pre-eminent achievement and merit in service to Australia", including his role in the wake of the MH17 tragedy.
"In the difficult hours after the loss of MH 370 and the loss of MH 17, Australia turned to Sir Angus to lead our response," he said.
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"Sir Angus headed the Joint Agency Coordination Centre during the search for Flight MH 370 and he was my Special Envoy to Ukraine leading efforts to recover, identify and repatriate Australians killed on Flight MH 17."
Sir Houston was made an Officer of the Order of Australia in 2003 and made a Companion of the Order of Australia (Military Division) in 2008.
Prince Philip will also receive the honour, recognising his work through the Duke of Edinburgh’s Award in Australia.
Mr Abbott said Prince Philip was receiving the honour to recognise his contribution to Australia over the course of the Queen's 62-year reign.
"Prince Philip's long life of service and dedication should be honoured by Australia," Mr Abbott said.
"For three quarters of a century, Prince Philip has served the Crown, and the wider Commonwealth.
"He has served Australia with distinction and is patron of over 800 organisations."
He said the The Duke of Edinburgh's Award in Australia had "supported the development of young Australians for more than fifty years".
With AAP.
