Tuesday’s budget saw technology elevated to new importance. But it lacked the bold bets and overarching strategy needed to support Australia’s new economies, according to innovation experts, who have also questioned the rosy outlook many measures rely on.
At the InnovationAus Budget Insider event Wednesday, innovation and emerging economies expert Dr Sarah Pearson said encouraging programs were revealed in the budget, but overall it lacked ambition.
This is a problem at a time when other countries are using the pandemic recovery to accelerate new economies, according to Dr Pearson, who was the the inaugural Chief Innovation Officer and Chief Scientist at DFAT.
“Something I would have loved to have seen though is a much more of an overarching strategy, and much more of an ambition and a vision for where we’re taking our economy,” Dr Pearson said.
Tuesday’s budget included a $1.2 billion digital economy package, but the bulk of the money is going to two existing government technology programs and the flagship AI investment is only half of what the industry had said was needed.
Dr Pearson also questioned the low levels of funding for renewables and the university sector.
AI scale-up Max Kelsen chief executive Nick Therkelson-Terry, agreed the budget lacked ambition and some of the measures were too restrictive. But he said they still represent “the most significant budget for the technology sector in quite a while”.
“The last couple [of budgets] haven’t delivered a lot to the sector,” Mr Therkelson-Terry said.
“And so it is good to see a lot of the things that we’ve been asking for, in some ways land in this budget. But it does lack that overall strategy and that ambition.”
Also of concern for the AI company chief was the government’s focus on AI adoption rather than building it, in its new strategy for the technology.
“That makes me very concerned. AI [or] machine learning is one of the most transformative technologies we’re going to see in a long time, and Australia can’t be just buying it,” he said.
“We need to be building an exporting it. So that’s, I think, a missed opportunity.”
Also missing from the budget was a long term strategy to address the plummeting migration during the pandemic, which Mr Therkelson-Terry said was putting unsustainable upwards pressure on wages in the sector.
Freelancer CEO Matt Barrie said the budget had been built on “a remarkable number of assumptions and wishful thinking”.
While he encouraged the optimism, he said the government should be planning for the likelihood Australia’s vaccination will continue to be slow and borders could remain largely shut for years.
“It’s still very early days and they say in the budget, that COVID is 30 times worse than the GFC,” Mr Barrie said.
“Well there’s nothing here in the budget indicates to me is 30 times worse at all. It’s [accounted for] like a little speedhump.”
A “proper” federal quarantine facility was the biggest omission from the budget, Mr Barrie said.
“I think that is the premise that makes this all work.
“If we we’re having a breach every 106 cases being brought in, and the cases are still growing around the world — in some places exponentially, particularly from the markets we tend to bring people in from — you’ve got to have really good quarantine.”
Uncertain geopolitics and commodity markets also haven’t been fully accounted for in the government’s latest financial plan, Mr Barrie said.
Dr Pearson agreed the budget should have leant more weight to the geopolitical and economic uncertainties, which make sovereign capabilities even more important.
“We’ve got really smart people in universities who are ready to help us build new industries, who are ready to help us solve social as well as the economic challenges,” she said.
“But we’re not reaching into that in this budget, from my perspective. So I think that’s a missing piece.”
Listen to the Budget Insider 2021 podcast here.
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