Two-year charm offensive before Labor ministers did $1bn quantum deal
A US-based tech company that won almost $1bn in taxpayer funds wooed Queensland and federal ministers over two years and hosted Ed Husic and Cameron Dick at their California HQ.
The US-based tech company that won almost $1bn in taxpayer funds to build a yet-to-be developed quantum computer in Brisbane wooed Queensland and federal ministers over two years, hosting Industry Minister Ed Husic and Queensland Treasurer Cameron Dick at its Palo Alto headquarters.
The Australian has been told 20 unsuccessful domestic and international quantum firms invited by Mr Husic’s Department of Industry and Science to bid under an expression of interest process have effectively been gagged from speaking about the EOI.
Industry sources have suggested the EOI criteria was designed to favour PsiQuantum, which is backed by global and Australian investors, including Blackbird, BlackRock, Microsoft M12 and Temasek.
Senior government sources reject this claim, with Mr Husic on Tuesday saying “we applied technical, legal, commercial and probity assessments … to inform cabinet processes on what would be required … this has been a determined, deliberately, detailed process”.
Austrade was heavily involved in connecting PsiQuantum with the Queensland and federal governments and plans for a joint taxpayer-funded investment were accelerated following Anthony Albanese’s 2022 election win.
Mr Husic met with PsiQuantum for the first time in October 2022 before the Industry Minister flew to the US three months later and toured the company’s Silicon Valley facilities.
Amid criticism over a hand-picked expression of interest process that facilitated the $1bn equity and loans package, public records show the foreign-owned tech start-up repeatedly met with Queensland government ministers over two years.
Following revelations about Labor-linked lobbyists and consultants helping PsiQuantum secure funding, Peter Dutton on Wednesday accused the Albanese government of authorising the cash splash “against the advice of the (Industry) Department”.
The Australian understands less than 10 per cent of Queensland’s $470m contribution is direct grants, with the majority to be made up of an equity stake in the company and loans.
Queensland’s investment into PsiQuantum did not involve a competitive process. PsiQuantum was the only firm subjected to due diligence processes by Queensland Treasury and the Queensland Investment Corporation.
The Albanese government is under pressure to clarify funding milestones, what will be manufactured in Brisbane and the quality and number of jobs. Hi-tech trays, cabinets and other components relating to photonic light requirements are expected to be manufactured in Queensland. Ministerial diary records show Mr Dick first met with PsiQuantum on April 7, 2022, before meeting chief executive Jeremy O’Brien and chief strategy officer Pete Shadbolt at the company’s Palo Alto headquarters on July 14 that year.
Notes from the meeting – also attended by then-under treasurer Leon Allen, who is now the head of the government’s central financing authority, the Queensland Treasury Corporation – reveal Mr Dick spruiked “Queensland’s attractiveness as a site for future investment”. Also on hand were Queensland’s North American Trade and Investment Commissioner Viki Forrest and the state’s global investment commissioner, Ross Buchanan. In August 2022, Mr Dick met with PsiQuantum and Austrade representatives in Brisbane alongside his departmental and ministerial staff.
Following Mr Husic’s US visit, Labor federal and state governments began fast-tracking the process, with the Department of Industry and Science last year launching an EOI to explore the “maturity” of the quantum computing market. Lobbyist firm Brookline Advisory, operated by veteran Labor staffers turned lobbyists Lidija Ivanovski and Gerard Richardson, who most recently worked for Richard Marles and Jim Chalmers, were engaged by PsiQuantum to represent them in Canberra on May 12.
PsiQuantum also engaged the services of economic and strategic consultancy firm Mandala, run by former Kevin Rudd, Julia Gillard and Bill Shorten senior adviser Amit Singh. The US firm, which has strong Australian links, has also recruited lobbyist and communications firm Akin Agency and Liberal-aligned CT Group.
PsiQuantum – led by Australian co-founders Professor O’Brien and former University of Queensland professor Terry Rudolph – hired Brookline Advisory as its lobbyists in the sunshine state on June 5.
On August 14, then-premier Annastacia Palaszczuk and her advisers met PsiQuantum’s London-based chief commercial officer, Lawrence Morgan, in Brisbane. Her chief of staff, Jim Murphy, met company representatives the following month.
Within weeks, Ms Palaszczuk announced Queensland’s Quantum and Advanced Technology Strategy, launching a regular Quantum Innovation Queensland” roundtable of senior government and academic members to discuss the policy and government moves. Meeting minutes reveal PsiQuantum senior researcher Geoff Pryde was a guest at all three of the government-hosted meetings so far.
PsiQuantum, which is unlikely to have a quantum computer operating until at least 2029, this week said it would build the world’s first utility-scale quantum computer at a “strategically located site near Brisbane Airport” and the company was on an “aggressive plan to have the site operational by the end of 2027”.
Amid concerns Australia will not retain intellectual property if the quantum technology is realised, Mr Husic has acknowledged PsiQuantum would own the computer but Australia would get access to its computing power.
Mr Dutton said the government’s priority should be shielding families and businesses from the cost-of-living crisis “instead of giving money to Labor mates”.
“We’re seeing deals at the moment, billion-dollar deals announced on a daily basis, and we know that the deal on the quantum computing was stitched-up together by a team of Labor former staffers and we know that deal has been put together against the advice of the department,” Mr Dutton said.
Kooyong MP Monique Ryan, whose private member’s bill requiring greater transparency around federal ministerial diaries has been blocked by the Albanese government, said Australians should not be kept in the dark about meetings with lobbyists.
Dr Ryan said “we don’t know who they invited to submit” expressions of interest and it was understood that people involved in that process “aren’t free to discuss it”.
More Coverage
War will end when Israel’s foes stop attacking it
Hamas began hostilities on October 7 when it invaded southern Israel and began slaughtering and kidnapping Israelis. Only an evil or foolish leader would start a war. But nations are entitled to defend themselves against attack.
Australia is not the same country — but too many are in denial
Since the October 7 attacks, Australian values have been traduced. What is happening affects the entire country and the collective impact is profound.