The Albanese government faces $600bn question on tackling artificial intelligence

AI is forecast to significantly boost the economy by the end of the decade, prompting the government to adopt a lighter approach to the much-hyped tech.

Tackling the rampant rise of artificial intelligence and ensuring the technology remains safe and avoids an armageddon-type scenario has become a $600bn question for the Albanese government.

The Department of Industry, Science and Resources has released its interim response into the safe and responsible use of AI. The 25-page document reveals the government’s thinking into the risks AI presents, and more importantly what it plans to do about it.

It is light on action, with the government turning more to the US in regard to regulating the technology. Unlike the European Union — which has been clamping down on tech, so much so it changed the way Apple designed chargers on its devices — there is no mention of a dedicated artificial intelligence act.

Instead, Australia is looking at clarifying and strengthening existing laws — rather than creating new ones — to ensure the technology is not misused and becomes a threat to society.

Why? The answer lies in the first two sentences of the document: “The potential for AI systems and applications to help improve wellbeing, quality of life and grow our economy is well known. It’s been estimated that adopting AI and automation could add an additional $170bn to $600bn a year to Australia’s GDP by 2030.”

While the US’s light touch on regulating big tech is well known — it is home to world’s largest technology companies and it doesn’t want to crimp their innovation and surrender its competitive advantage to China — Australia is under no such pressure.

If the Australian government doesn’t act fast on AI, the genie may fully flee the bottle.

But the Albanese government is still in a bind fulfilling its election promises to bring down the cost of living. This requires tackling inflation, which in turn means bolstering output, and this is where AI comes in.

According to The Australian’s 2024 CEO Survey, most of the nation’s bosses see AI as their main lever to lift flatlining productivity and restore the country to real wages growth. AI is therefore key to making us all feel rich again.

With the technology set to inject up to $600bn a year — almost a quarter of Australia’s GDP — into the national economy by the end of decade, the Albanese government can’t afford to take an EU-style gamble.

Indeed, the report states: “The rate of technological change makes it difficult to ensure that regulation is future-proofed and can meet unforeseen challenges without stifling innovation”.

“The Australian government will avoid unnecessary or disproportionate burdens for businesses, the community and regulators. It will balance the need for innovation and competition with the need to protect community interests including privacy, security and public and online safety.”

But the report says “while AI is forecast to grow our economy, there is low public trust that AI systems are being designed, developed, deployed and used safely and responsibly.”

Adding to concerns is this week’s International Monetary Fund analysis which revealed AI in advanced economies — such as the US, UK and Australia — will affect about 60 per cent of jobs.

The IMF says for about half those jobs “AI applications may execute key tasks currently performed by humans, which could lower labour demand, leading to lower wages and reduced hiring”.

“In the most extreme cases, some of these jobs may disappear,” the IMF says.

But the Albanese government says in its interim report AI can also “create new jobs, power new industries, boost productivity and benefit consumers”.

“Highlighting the benefits presented by AI will boost community confidence,” the report states.

However, big tech has also so far revealed itself to be less trustworthy when it comes to training their powerful AI engines. Yann LeCun, chief AI scientist at Facebook owner Meta, argued earlier this month books should be able to be downloaded for free, given few authors make “significant money” from publishing.

Microsoft senior director Tren Griffin said authors could make more money from mowing lawns.

The comments come as The New York Times is suing Microsoft and ChatGPT over open AI, alleging the companies’ powerful AI models used millions of articles for training without permission.

The Australian government has yet to take any firm action on ensuring copyright remains protected, ensuring artists, musicians, novelists and other content creators can still make a living, despite warnings from former competition watchdog chair Rod Sims.

Its interim document into the safe and responsible use of AI merely says it is committed to “ongoing research and consultation by the Attorney-General’s Department and IP Australia, including through the AI Working Group of the IP Policy Group, on the implications of AI on copyright and broader IP law”. It’s a mouthful delivering nothing.

Similarly, it says it needs to complete more work about defining high-risk AI. Again, this comes back to ensuring the government doesn’t stifle innovation and the economy.

“Further work is needed to define the criteria of risk categorisation to ensure that safe AI systems would not be over-regulated and that dangerous AI systems would not be under-regulated.

“Likewise, further work is needed to identify what would be the most appropriate guardrails and regulatory interventions for each category of risk. It will also be important to further refine definitions of ‘high-risk’ AI, including taking into account developments in overseas jurisdictions.”

Industry and Science Minister Ed Husic says he is well aware of community concerns. “We have heard loud and clear that Australians want stronger guardrails to manage higher-risk AI,” he said.

“The Albanese government moved quickly to consult with the public and industry on how to do this, so we start building the trust and transparency in AI that Australians expect.”

But the clock is ticking. AI platforms and advancements are being launched almost daily, with most Australian companies quickly adopting the technology. The government must act fast. Otherwise the genie will fully flee the bottle.