A White Paper by the Australian Information Industry Association
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GROWING GLOBALLY
2021
COMPETITIVE INDUSTRIES
Powered by Australia’s innovation technology
A White Paper by the Australian Information Industry Association
Contents Introduction 1 Steering Committee 3 Summary of Recommendations 4 Chapters 1. Agriculture 11 2. Health 18 3. Digital Government 29 4. Manufacturing 38 5. Engineering (Digital Twins) 43 6. Quantum 52 7. Supporting innovation from conception to commercialisation 59 8. Cyber Security 64 9. AI/Machine Learning 72 Appendices A. About the Australian Tech Sector 81 B. AIIA Member Survey 82 Use of the AIIA White Paper This publication is provided by the AIIA for general guidance only and does not constitute the provision of tax, legal, investment or product advice. The information is provided “as is” with no assurance or guarantee of completeness, accuracy or timeliness of the information, and, to the extent permitted by law, without warranty of any kind, express or implied. No part of this publication may be quoted, cited, excerpted, reproduced, stored in a retrieval system or database, distributed or transmitted in any form or by any means without the prior written permission of the AIIA. Requests should be submitted in writing to Simon Bush at simon@aiia.com.au outlining which excerpts you wish to use and the context in which you wish to use it. Disclaimer This white paper does not necessarily reflect the views and recommendations of individual members of the White Paper Steering Committee. Growing Globally Competitive Industries
Introduction
Growing globally competitive industries - Powered by Australia’s innovative technology
The past decade has seen an acceleration in Twelve months ago, the Australian Information
changes to the world’s economic, political, Industry Association (AIIA) released its white
environmental and social frameworks. Global paper, Building Australia’s Digital Future in a
economies are becoming more competitive Post-COVID World1. We were only months into
more rapidly. Australia has both a significant a global pandemic when the AIIA saw the
opportunity to benefit as it has a challenge need for new thinking in the way governments
to keep pace and compete. Technology is respond to the societal and economic
driving the growth globally; it is both solving and challenges that were and are still facing in
creating problems. Investment in innovation is Australia. We remain proud of this work and
now a given and this paper identifies areas of the ongoing policy influence it has achieved
our economy where we must focus to ensure and the results it has produced. Among the
we keep pace and ensure future national recommendations, it is pleasing that the
economic success. government has adopted:
The transformative opportunity that technology • Recognising that digitising the economy is
provides is now undeniable. It is clear that critical to our national success;
those countries, industries, governments and • Increasing the R&D tax incentive and
enterprises that successfully drive technology introducing a patent box;
innovation at the core of their strategies are
• Appointing a Minister for the Digital
the ones that will maximise opportunity from
Economy;
the shifts occurring in our world. As Australia’s
global trading partners are investing heavily • Funding a National Freight Hub;
in technology, we must recognise now that • Investment in digital skills; and
our country runs the real risk of becoming • Investing in cyber security resilience.
uncompetitive. This would ultimately result
in Australians being consumers rather than We have also seen, in recent state and federal
producers of products and services to global budgets, significant investments in the digital
markets which in turn can threaten the very opportunity, with the Prime Minister stating as a
core of our economy and its primary industries. major economic and policy goal for Australia
to be a leading digital economy by 2030, which
Australia’s economic success is reliant on has been backed up with significant funding,
being globally competitive across our core including the $1.2 billion Digital Economy
trade-exposed industries. Australia does have Strategy. Likewise, the NSW Government
the capability to maintain its world leadership maintains its leadership position in digital
across our key industries with a strategic government and service delivery with its $2
approach to investment in technology. This billion Digital Restart Fund to ensure that NSW is
White Paper outlines our nation’s key policy well placed to succeed as a global economic
challenges and opportunities as it presents hub for the next generation.
the path forward for Australia in the context
of critical industries and core technology However, there is much more to be done to
capabilities that must be supported. achieve this objective. The AIIA has, in this white
paper, focused on what we believe to be the
There have been positive steps forward already key industry ‘verticals’ in which success and
taken by government to support this critical innovation is essential for Australia to remain
agenda. globally competitive.
1
https://aiia.com.au/wp-content/uploads/2021/03/Building-Australias-Digital-Future-in-a-Post-COVID-World-AIIA-Whitepaper-2020-1.pdf
Growing Globally Competitive Industries 1
These industry verticals are health, Much like we saw Australia take up the digital
manufacturing, agriculture, and digital mantle in 2020, the AIIA is asking that Australian
government. governments and industry strengthen their
resolve to drive a true digital future for all
The AIIA has also dedicated chapters to cross- Australia and its critical industries.
industry ‘horizontals’: AI, Quantum, digital
engineering, industry incentives and cyber Note
security.
What the AIIA has not specifically focused
We are calling on Australian governments on with its own discrete chapter, but have
to continue to take a leadership position on instead referenced across the paper as a core
technology strategy for Australia. However, to capability or barrier, is the skills agenda.
ensure that this leadership position is realised,
critical Australian industries must receive In the 2020 AIIA White Paper, there was a large
strategic government support and focus focus on the importance of digital skills required
to evolve into their digital futures to ensure across the economy and this remains an
Australia can continue to compete globally. outstanding area for government policy focus
and execution.
We call on the Federal Government to take
the lead in accelerating the digitisation of Whilst the federal government demonstrated
Australian industry through the creation of it could be agile and responsive in 2020 during
industry hubs and incentives; to play a leading the initial stage of the pandemic response,
role in coordinating Industry, Government and 2021 has shown that fundamental public sector
Technology to initiate a new era of technology digital skills and leadership can be lacking, an
innovation in Australia; to ensure standards obvious reference point being the vaccination
and interoperability requirements are in place roll out and lack of a common digital platform.
to maximise the opportunity that technology
presents to Australia; and to ensure the new Other urgent policy reforms in the skills portfolio
generation of Australian technology innovators are moving, in places, at a glacial pace, with
are supported to thrive, not just survive, through traditional approaches and vested interests
a strong shift from a research driven agenda to in the sector slowing down progress, with
one of commercialisation. the microcredential skills acquisition and
accreditation area one example.
It is important to note that an innovation
technology driven agenda that places The AIIA has released, in 2021, two other
Australia as a global leader across our priority significant contributions to the public policy
industries is only reliant on our ability to invent debate in Australia covering government
and commercialise. It is not dependent on our procurement as it relates to a domestic
size or our location. This mindset can change capability policy framework for digital
the way we and others view us. technologies as well as recommendations for
Australia to increase its adoption of virtual care
During this time of significant transformation, in the health sector.
whether it be geo-politically, economically,
technologically or socially, we must continue to
focus on building a resilient, flexible and future- These papers can be accessed via these links:
focussed Australia that is able to maximise the
opportunity that technological advancement is
• AIIA Domestic Capability: Framework Policy
providing.
By continuing to take a lead in prioritising • Beyond Telehealth: Towards Virtual Care
critical industries and investing in critical White Paper
technologies, Australia has an opportunity to
secure its place, and its industries, in the global
arena.
Growing Globally Competitive Industries 2
Steering Committee
The AIIA would like to thank the following for About the AIIA
their time, effort, expertise and dedication in
assisting with the drafting of this white paper; The Australian Information Industry Association
however content and recommendations (AIIA) is Australia’s peak representative body
are those of the AIIA and do not necessarily and advocacy group for organisations in the
represent the views of member companies. digital ecosystem.
• Bridget Tracy, AIIA NSW Council Since 1978, the AIIA has pursued activities to
• Ron Gauci, AIIA stimulate and grow the digital ecosystem, to
create a favourable business environment
• Ramah Sakul, SAP
for members and to contribute to Australia’s
• Peter Anstee, CyberCX economic prosperity.
• Ashok Mysore, Infosys
• Kristina Kipper, KPMG We do this by delivering outstanding member
• Anna Phan, IBM value by providing a strong voice of influence;
building a sense of community through events
• John Mackenney, Adobe
and education; enabling a network for
• Ben Peterson, IBM collaboration and inspiration; and developing
• Michelle Frazer, DB Results compelling content and relevant and
• James Jackson, Accenture interesting information.
• Simon Bush, AIIA
For more information, please contact Simon
Bush, AIIA GM of Policy and Advocacy, via
We would also like to thank for their
email simon@aiia.com.au.
contributions the following people who have
provided input, advice or guidance through
the course of the drafting:
• Dr Tim Mumford - Infrastructure Australia
• Marie Truelove - CSIRO Data-61
• Dr. Ian Oppermann - Chief Data Scientist,
NSW
• Adam Beck - Smart Cities Council, Australia
& New Zealand
• Dr Graeme Kernich - Frontier SI
• Teresa Scott - Australasian Procurement and
Construction Council
• Dr Tim Smyth - Adjunct Professor, University
of Technology Sydney
• Jordan Griffiths, Accenture
Growing Globally Competitive Industries 3
Summary of Recommendations
Agriculture • There be a review of the $1.2 bn a year
in levy funds which is currently distributed
Recommendation that: between the 15 Australian Rural Research
and Development Corporations (RDCs)
• AgTech be recognised as a standalone for research to ensure alignment to
industry which is both supportive and development of AgTech innovation and
complementary to Agriculture. It is commercialisation.
recommended that Government and
Industry form a new standalone oversight
Health
body and governance framework
specifically focused on Agtech as a sector,
Recommendation that:
as well as facilitation of an increase in
co-ordination of AgTech development
• Government identify, promote and prioritise
initiatives across departments, such as
new digital delivery models that are
the Department for Agriculture and the
secure, flexible and scalable to meet the
Department for Industry, Science, Energy
burgeoning needs of Australia’s health care
and Resources.
systems.
• The Federal Department of Agriculture
• Government consult health and
establishes a standalone AgTech Branch.
technology industry providers, funders,
industry associations and consumer groups
• The Federal Government create a Robotics appropriate members of the health
Commercialisation and Acceleration fund industry and the ICT industry for input
under the framework of the AIIA proposed into frameworks, policies and funding
National AI Commercialisation Hub as mechanisms.
recommended in the AI chapter, with a
distinct AgTech allocation under the Hub.
• Government work with industry to ensure
standards alignment and interoperability
• The Federal Government provide funding for digital health, including cloud-
to conduct research and business case based infrastructure and services to
establishment into establishment of a pilot drive accessibility and Fast Healthcare
AgTech Regional Innovation Centre to bring Interoperability Resources (FHIR) for
the various AgTech stakeholders together, interoperability, and make these publicly
using incubator style engagements, available in a central repository or
connecting RDC’s, Start-ups with research, catalogue.
Industry, and investors to improve
commercial outcomes.
• National Cabinet (Federal and State
Governments) agree that we need a more
• The Department of Agriculture work with integrated, modern and seamless digital
Industry and Standards Australia to ensure health capability for Australia.
standardisation in areas such as sensors and
hardware facilitating interoperability and
• The Federal Government works with state
easy adoption.
governments and industry to develop a
national capability or platform designed
• The Federal Government establish a to provide interoperability and integration.
dedicated AgTech funding stream of $10 This will promote a federated platform
million within the Department of Industry’s accessible to Industry which ensures all
‘Entrepreneurs’ Program. digital health solutions have a base level of
Cyber security, Interoperability, adherence
Growing Globally Competitive Industries 4
to protocols, Data Privacy, Quality, Data • For Governments to introduce legislation
Trust, Accessibility and Standards: to provide clarity on the capture and
recording of comprehensive quality and
° Identify, promote and make available accurate health records and associated
digital low-code platforms which data being owned by the patient.
provide rapid delivery of digital solutions The purpose of this then is to provide
capability to industry and government centralisation, privacy and trust relating to
to fast-track digital innovation and patient information.
implementation.
• Mandated key patient information flow
° The federal government to build a from health organisations and health
Digital Development Assistant which software suppliers to re-engineered My
sits above these technology platforms Health Record within five years (2025).
and ensures consistent application of
standards, cyber security protocols, • The enactment of anti-information
interdependency principles, patient blockage legislation, with significant loss
centric design principles and rapid of funding or penalties for organisations
technology delivery approaches. and suppliers who do not comply with the
mandatory sharing within the specified
° That government provide appropriate timeframe.
support to industry to develop a
commercialisation framework that • Easy and secure access to My Health
encourages the building of a library of Record data via a direct portal (not through
reusable components and innovative MyGov) which is accessible on any device.
emerging technology tools such as
Artificial Intelligence, Robotic Process
Digital Government
Automation, Internet of Things.
Recommendation that:
• Governments to develop and implement
new funding models and processes that • Following the lead of the commercial
encourage collaboration, development sector, governments should invest in citizen
of innovative technology solutions, and journey management technologies.
enhanced health outcomes and ensure
that agencies where appropriate can
• Government agencies establish an AI
move from cap ex to op ex delivery models.
Process Transformation agenda that
delivers Government process optimisation
• Create specific digital technology funding that not only achieves budget savings
programs, to encourage organisations but allows adoption and integration of
to undertake digitisation projects, with modern technologies. This agenda must
accelerated approval processes. be supported by full engagement of the
appropriate stakeholders and enables the
• Successful pilot digital innovation projects identification of suitable candidate business
should be fast-tracked onto procurement processes for piloting, both internal and
panels for implementation and extensively external.
promoted throughout the industry.
• Government agencies will need to identify
• Re-engineer My Health Record to become and empower AI Champions to support
a true digital health record with a database and drive this agenda - at the senior
of discrete data, and software algorithms to business agency level.
analyse the data, identify health risks and
provide alerts to prompt immediate action.
Growing Globally Competitive Industries 5
• That government should accelerate the • That the proposed national hub bring
work being undertaken around digital skill together and provide needed scale
mapping, and the work of the APSC on to many smaller projects including
digital and career pathways, to ensure that Victoria’s Swinburne University Advanced
government policy objectives are met. Manufacturing Industry 4.0 Hub and South
The AIIA and its members would be willing Australia’s Flinders University Line Zero.
to work on industry matched skills and
training accreditation, especially on short Engineering (Digital Twins)
and micro-courses needed to rapid up and
cross-skilling (e.g. cyber). Recommendation that:
• The Federal Government establish an Office
• Appoint a cabinet minister focussed on of National Digital Twin (eg. UK Centre for
citizen centric delivery for those jurisdictions Digital Built Britain, Digital Twin Victoria) to
that do not have this in place. drive Digital Twin capability development
and application on existing infrastructure,
• Review government funding processes urban growth planning and spatial
for Digital and IT investments for those agencies (as an example) can champion
jurisdictions that are not leveraging Digital Twin advancement and be a starting
centralised funding mechanisms to drive point in creating a Digital Twin strategy and
integrated digital citizen experience programs of work.
outcomes.
• The Australian Government should develop
• Australian governments have underinvested a National Digital Twin Infrastructure
in digital capability and they need to Standards roadmap that would seek to
allocate funding in Citizen focused Digital increase digital adoption and consistency
Restart Funds with appropriate timelines in all Australian infrastructure delivery
and funding criteria (as digital is now the and operations and to deliver maturity
preferred channel for citizens 56%). frameworks, templates, risk framework,
methods for increasing data safety.
• Governments adopt cloud first policies with
clear KPIs. • Government establish a National Digital
Twin Consortium (on similar lines to DT
Consortium in UK) - a collaborative
Manufacturing organization driving the innovation of
digital twin technology adopting national
Recommendation that:
standards, consistent approaches and
open-source development. It amalgamates
• That Industry 5.0, which is currently omitted
industry, government and academia
from the Federal Government’s Modern
to drive consistency in vocabulary,
Manufacturing Strategy and roadmaps, be
architecture, security and interoperability
incorporated as part of an update to reflect
of digital twin technology. The consortium
this new evolution of person and machine
advances the use of digital twin technology
collaboration.
in many industries from aerospace to
natural resources.
• Government and industry to collaborate
and invest in a Modern Manufacturing
• As part of the remit of the Office of the
Technologies Hub. The Hub incorporates
National Digital Twin, state and federal
academic, industry and government
governments agree to establish a National
and focuses on the key technology
Data Quality Management (NDQM)
enablers and capability into the Australian
Framework which is necessary to enable
manufacturing SME ecosystem. Ideally
effective data management across the built
this would be industry led and have a
environment that addresses secure, resilient
commercialisation focus.
Growing Globally Competitive Industries 6
interoperability, which is fundamental for
creation of a national digital twin. • Investment is needed to amplify Australia’s
significant strength in quantum research,
• In conjunction with NDQM create a NDQM commercialise emerging quantum
Data Injection Standards / Platform, which technologies and solidify Australia’s
all States / Territories can use to create and leadership. This investment needs an
enrich consistent time value contextual accompanying national quantum
intelligent data sets and can share data technology strategy with governance and
within policies established by ONDC (Office oversight to ensure focus and coordination.
of National Data Commissioner)
• The Federal Government invest a minimum
• Government establish a central Data of $110 million over four years in a National
Registry-as-a-Service that provides Quantum Computing Centre if we are
consistent, intelligent, time-value contextual to keep pace with global trends. This
data to all entities within the ecosystem investment is based on the Quantum centre
while supporting federated data sharing as needing to be at least double that of a
per numerous principles cited in ANZLICs, national artificial intelligence centre due to
UK’s Gemini Principles and others. the wider breadth of quantum computing
research and development, in both
hardware and software.
• That the Office of the National Data
Commissioner be given responsibility for
driving data requirements around digital
twins. Commercialisation
• Government to establish a National DT Recommendation that:
Skills Framework akin to the Skills and
Competency Framework under CDBB’s • The Federal Government commission a
National Digital Twin Program that is the comprehensive review of how Australia
people enabler needed to develop and supports innovation, from ideation through
execute National Digital Twin Roadmap. to commercialisation with the objective of
creating a national framework for support
and recommending how existing gaps can
• That the Digital Skills Organisation’s
be addressed. This review must necessarily
responsibilities be extended to support the
consult with key stakeholders including
National DT Skills Framework.
state governments, industry associations,
research institutions and higher education
• Similar to investments in “3D Digital Atlas”, and should cover tax incentives, grants and
the Federal Government should explicitly other government programs that currently
state the quantum of investments allocated support industry-based innovation.
to National DT Infrastructure initiatives.
• Government focus immediate efforts on
Quantum Computing supporting and enabling industries of
strategic importance to not only ensure
Recommendation that: sovereign and domestic capability, but
to also make them globally competitive
• Government needs to dedicate resources and act as exemplars for other Australian
to identify the potential quantum-era industries.
security exposures across all departments
and keep abreast of the developments • Government works with industry and
in post-quantum cryptography standards, research organisations to develop
to implement solutions as they become mechanisms to foster greater collaboration.
available.
Growing Globally Competitive Industries 7
• Government considers an innovative ° Partnerships should be pursued and
software development tax incentive or deepened within existing structures
grant to support development of innovative including the Five Eyes, Quadrilateral
software which does not qualify for the Security Dialogue and with broader
R&D Tax Incentive, but has the potential to like-minded nations that play key
create innovative products and services roles in setting standards for, and the
that will benefit the Australian economy. development and manufacturing of,
critical technologies.
• Government extends the ambit of
the proposed patent box regime to • Australia should also establish public-private
patents relating to all sectors of strategic partnerships and consortium models that
importance. recognise and support secure industry
partners to compete on the global stage –
acknowledging that competition is currently
Cyber Security skewed with some suppliers receiving
significant state support.
Recommendation that:
• In recognition of the global demand for
• Government supports the growth of our secure critical technology solutions, there
domestic and strategic cyber security should be greater investment in Australia’s
capability to ensure Australia has the skills development of critical technologies.
necessary to secure critical technologies by:
• That government and industry identify
° initially focusing on developing areas of critical technologies where
standardised cyber security requirements Australia has competitive advantage and
(leveraging the work done by the economic opportunity exists. Government
NSW Cyber Standards Harmonization should provide greater support to our
Taskforce), such as certification and world-leading research and development
accreditation requirements for industry. sector to direct their efforts towards critical
These could build on the good work technologies. Our investment should be
achieved through the NSW Standards bolstered in areas that Australia is already
Harmonisation Taskforce. In meeting making significant strides, such as quantum
such standards, industry would have to computing.
invest in internal and external talent and
the technology required to uplift their • There should be cllear articulation from
security. government of the technologies deemed
critical, the applicable security requirements
• Government incentivise and prioritise and greater visibility of the threats.
increased investment to grow Australia’s
cyber workforce pipeline. Investment should • That government provide clear guidance
seek to strengthen the Cyber Security of how existing legislative and regulatory
National Workforce Growth Program and requirements apply to critical technologies
the Cyber Skills Partnerships Innovation as it rolls out enhanced security
Fund detailed in Australia’s Cyber Security requirements for critical infrastructure and
Strategy 2020. The cyber security industry include in any such framework appropriate
covers a broad range of skills. A clearer checks and balances that first empower
view of the most critical cyber security roles and enable industry to drive security
would be welcome. outcomes, then support public-private
partnerships in times of crisis.
• Global partnerships are developed to
ensure continued access to secure critical • That government and industry develop
technology supply chains, for example: critical technology security standards
Growing Globally Competitive Industries 8aligned with international partners to • Government agencies publish a constantly
enable trusted trade and engagement, updated portfolio of AI enabled customer
resilient underpinning capabilities and service enhancing projects.
support Australian industry to compete on
the global stage. • As part of the Secretaries ICT Committee,
the Federal Government should stand up a
• That, in developing a mandatory reporting Government AI Ethics Committee and invite
scheme for businesses that pay ransoms to in external members for example, (industry,
cyber criminals, the Government carefully University sector) to review citizen facing
consider whether the collected data is kept use of AI projects.
confidential or published and work with
industry in developing this policy. • Government as a major ICT procurer
should support the local AI ecosystem and
• That the Australian Government makes establish a cross-agency panel process
the necessary changes to the Privacy Act to allow agencies to put problems out to
1988, including removing exemptions for tender and allow companies to come
employee records and small business, which forward with AI enabled solutions.
will better enable it to seek adequacy status
under EU law, and increasingly the law of • That leaders from within the Australian AI
some of its major OECD trading partners, industry partner with a government agency
therefore remove compliance red-tape and lend their insights and expertise to
for Australian business wishing to establish empower that agency to fully harness the
global markets in digital commerce. benefits of AI – to become a “model AI
citizen” – as a case study.
• That, in consultation with the membership,
the AIIA develops a set of industry level • That government and industry come
privacy guidelines that will enable business together to establish a national AI
to better meet current and emerging Commercialisation Hub that is focused on AI
regulatory and community requirements for research translation, investment attraction
the handling of personal information, and and support of AI start-ups to scaleups to
better equip businesses of all sizes to be enterprises to realise the $315bn potential
competitive in the global digital economy. dividends for the Australian economy of
digital technologies including AI.
Artificial Intelligence / Machine Learning
• Industry, government and the education
Recommendation that: sector work together to develop a National
AI Skills and Jobs Agenda to ensure the
• Industry and Government collaborate future workforce has the skills necessary
to harness the power of AI to help solve to support the growth of the Australian AI
Australia’s economic challenges in a critical industry into the future.
industry. See example of disaster resilience
further in this chapter.
• That the National AI Skills and Jobs Agenda
consider the establishment of a universal,
• Governments consider rolling out targeted nationally recognised qualification standard
education about AI to Senior Executive in relation to AI, to ensure the Australian
level staff within government agencies, to AI workforce continues to demonstrate
foster a better understanding of AI across consistently high standards of competency
government and the opportunities it and professionalism.
presents.
• Government agencies set targets/KPIs for
adoption of AI.
Growing Globally Competitive Industries 9• With the support of the AIIA, that Industry
and Government work together to
develop an AI ethics framework, to
ensure Australians can confidently and
comfortably engage with and leverage AI
in their day to day lives.
• That, once established, the AI ethics
framework operates as a self-regulating
industry Code of Practice.
• The Federal Government as part of the
EMA’s operational enhancements and
strengthening of the Australian Government
Crisis Coordination Centre ensure that
this work explicitly includes world leading
applications of AI. We also recommend that
this is extended to other phases of disaster
management e.g. preparedness and
recovery phases.
AI/Machine Learning
Growing Globally Competitive Industries 10Agriculture Image by Zac Edmonds on Unsplash
Introduction Factors such as diverse backgrounds, sizes, and
structures of agri-businesses as well as a lack of
Agricultural technology, or AgTech, is predicted digital skills and industry standards have proven
to become Australia’s next $100 billion industry to be impediments to broad base adoption of
by 20302. The sector is fast becoming a vital cutting-edge technologies and pressures on
part of the Australian economy and a growing AgTech Start-up business models have caused
source of both income and investment. Thriving friction around areas such as data sharing and
AgTech ecosystems, world-class research privacy.
institutions and high-quality produce, make
Australia an ideal environment for AgTech In recent years, the global market opportunity
innovation. in agricultural and food innovation has
continued to grow – attracting greater
Fueling the strong growth of this sector are the international focus and investment. Sadly,
ambitious growth targets set by the federal Australia has not yet managed to attract a
government. To meet this challenge, the significant proportion of this investment, despite
industry needs to almost double its current having a competitive, if somewhat immature,
annual growth rate, from 3 per cent to 5.4 per AgTech Start-Up ecosystem. Of the US$16.9
cent. billion invested globally in 2018, Australia
attracted only US$29 million.3
A rising middle class, especially in the Asia
Pacific, is moving from a simple diet to one The low level of investment in AgTech in
that is much higher in the kind of agriculturally Australia was also reflected in the 2021-
intensive foods in which Australia specialises. 2022 Federal Budget, which is in line with the
At the same time, demand for locally-grown Agriculture 2030 Strategy.
sustainable food is growing in the domestic
market. An investment of $34.8 Million for Agricultural
Innovation directed attention to four priority
Global warming and diminishing natural areas, export market development, climate
resources present obstacles to meeting this resilience, biosecurity, and digital agriculture.
changing demand. So too does the rising Together with a focus on the digitisation of the
cost of energy, labour and production inputs. bio-security infrastructure and technologies
These challenges have created the perfect focussed on soil health and biodiversity, there is
environment for AgTech to flourish. limited focus on developing AgTech as a core
industry or capability in Australia.
There is a growing trend towards consolidation
within the agriculture industry due to factors There is a need for an increased focus on
such as an increase in climate variability, commercialisation by ensuring a tighter
additional cost and investment needed due collaboration between industry, researchers
to increasing compliance requirements on the and investors and a regular review of funding
back of safety incidents such as the strawberry and policy settings to ensure that outcomes
contamination crisis of 2018, as well as other achieve potential.
factors such as generational shifts away from
agriculture. As a result of these changes in There is also an opportunity to create industry
dynamics, many smaller businesses are being standards that will allow for economies of scale
acquired by larger operators. and mass customisation to meet the varying
needs of agri-business while at the same time
There are challenges faced in adoption of enabling innovation.
technology and innovation however as the
agriculture sector has several unique dynamics
compared with other leading industries such as
financial services and industrials.
2
https://invest.nsw.gov.au/sector-opportunities/agtech
3
https://www.ausagritech.org/
Growing Globally Competitive Industries 12Agriculture’s place in Australia Agricultural Production is Growing
Australian agriculture accounts for: Agricultural production is a growing industry.
• 55% of Australian land use (427 million Drivers of output growth over the past 20 years
hectares, excluding timber production vary by sector:
in December 2020) and 25% of water
• In cropping, long-term falls in real prices
extractions (3,113 gigalitres used by
have been offset by volume growth, as
agriculture in 2018–19);
producers have improved productivity
• 11% of goods and services exports in 2019– by adopting new technologies and
20; management practices.
• 1.9% of value added (GDP) and 2.6% of • In livestock, higher prices have been the
employment in 2019–20 main driver of growth, reflecting growing
Australia has a diverse agricultural, fisheries and demand for protein in emerging countries
forestry sector, producing a range of crop and and some temporary factors, such as
livestock products. drought in the United States and disease
outbreaks such as African Swine Fever
The gross value of agricultural, fisheries and in meat importing countries. This poses a
forestry production has increased by 7% in great opportunity for the Australian Agtech
the past 20 years in real terms (adjusted for sector through leveraging technology and
consumer price inflation), from approximately innovation to maximise returns in traditional
$62 billion in 2000–01 to $67 billion in 2019–20. protein markets as well as in the rapidly
growing alternative Protein market.
Exporting is and will continue to be a key driver Managing slowing productivity growth is critical
of industry growth. In real terms, the value of to driving the economic performance of the
agricultural exports has fluctuated in a range industry.
between $40 billion and $60 billion since 2000–
01 with meat and live animals being the fastest- Over the last 20 years, Australian crop growers
growing export segment, growing 86% over the have increased production volumes by
period, followed by horticulture up 64% and approximately 19%, while prices have fallen by
forest products up 16%. more than 10%.4 The ongoing declines of output
prices of crops including Horticulture need
Exports to Australia’s eight largest markets in to be countered with a focus on productivity
Asia increased by 62% to $33 billion over the 20 growth. Prices for Australian producers are set
years to 2019–20 and accounted for 62% of the on international markets, meaning Australian
total value of agricultural, fisheries and forestry farmers must produce an internationally
exports in 2019–20. competitive product to be profitable.
Maintaining productivity growth and continued
China is Australia’s largest export market for innovation is therefore required if Australia is to
agricultural, fisheries and forestry products, at remain internationally competitive.
$16 billion in 2019–20.
Australian farmers have historically achieved
Exports to China are about 5 times larger strong productivity growth, increasing the
than they were in 2000–2001. Asian demand volume of output produced from a given set
is projected to double between 2007 and of inputs. Agricultural productivity growth has
2050, providing opportunities for exporters of been stronger over the long term than that
high-value, high-quality agricultural and food observed in most other sectors of the Australian
products. economy. It has also been comparable to
farmers in other high-income countries.
This growth has been driven by improvements
in technology and structural change.
According to the precision agriculture report
4
https://www.agriculture.gov.au/abares/products/insights/snapshot-of-australian-agriculture-2021#agricultural-production-is-growing
Growing Globally Competitive Industries 13called ‘Precision to Decision’, the Broadacre Recommendation
sector has received significant research and
development investment including the online • That AgTech be recognised as a
move to GPS guided harvesting and seeding standalone industry which is both supportive
and reduced chemical use. and complementary to Agriculture. It is
recommended that Government and
In recent years, however, agricultural Industry form a new standalone oversight
productivity growth has slowed due to body and governance framework
deteriorating seasonal conditions and less specifically focused on AgTech as a sector,
intense research and development efforts. In as well as facilitation of an increase in
addition, the indicative analysis suggests that if co-ordination of AgTech development
all broadacre farms had the same output per initiatives across departments, such as
hectare as the highest performing 20% of farms, the Department for Agriculture and the
the total value of broadacre agricultural output Department for Industry, Science, Energy
would be around 24% above current levels, and and Resources.
farm cash income would be around 46% above • That the Federal Department of Agriculture
current levels. establishes a standalone AgTech Branch.
With the need to address the slowing
The AIIA has identified specific opportunities in
productivity growth, and with smaller farms
AgTech for Australia to address productivity in
being less profitable on average than their
the Agriculture industry, these include:
larger counterparts, there is a great opportunity
to leverage technology innovation to achieve • Robotics and automation
similar levels of productivity and profitability with • The creation of Regional Agriculture Centres
the right investments and policies in place. to support evolution of AgTech solutions
such as
Opportunities to accelerate in AgTech • Supply chain traceability including use of
blockchain technology
The criticality of Agriculture to the Australian
• Synthetic biology and creation of new
economy and the future of Australia is clear,
proteins opportunities
as are the needs to step change addressing
productivity to ensure market growth continues
and is maximised. The linkage between the role Robotics and Automation
of technology and productivity growth of the
agricultural sector, AgTech has not been widely Agriculture offers one of the ripest opportunities
acknowledged as an industry in its own right as in Australia to advance the robotics and
well as a facilitator of industry growth. automation industry. The shortage of labour
to pick fruit, as exacerbated by the closure
The Australian AgriTech Association estimates of Australian borders during the COVID-19
that the industry could produce $20 Billion pandemic, highlights the role autonomous
in products and services and with the right robots can play in securing the agricultural
structures in place, could thrive, driving benefits industry and advancing productivity.
to both the industry itself and more broadly
across Agriculture. An example of Australian innovation in robotics
and automation is the company ‘Freelance
AgTech is also seen as a subservient industry to Robotics’ which has developed a range of
the agriculture industry rather than a distinct its own off-the-shelf robots and autonomous
Sector. This disconnect has contributed to the navigation system as well as provides and
Australian agriculture industry being among the builds bespoke robots for a range of industries.
least digitised industries in the world. This is an example that Australia is capable
of building local robotics and automation
capabilities without being dependent on
overseas innovations to cater for what is now
Growing Globally Competitive Industries 14an applicable technology solution to a well much more opportunity to create disruption
evidenced critical industry issue. in supply chains, including ‘paddock to plate’
blockchain ecosystems.
There is a lack of skills and scale in key areas
of opportunity in Australia such as robotics. Traditional value chains include many
Australia should be well-placed to seize on intermediaries but there has been a realisation
robotics in agriculture as a global opportunity that the value chain itself is a legacy construct.
but is up against well-funded competition from The concept of a transparent blockchain
places such as Abu Dhabi, which is investing ecosystem is seen by many traditional value
$US100 million into automated, self-sustainable chain members as confusing and a threat
agriculture. As part of our recommendation and are therefore resisting adoption. New
around creating a robotics commercialisation business models can be created to enable
and acceleration fund, any commercialisation, producers to create a direct relation with the
pilot programs and on farm adoption consumer, with blockchain enabled oversight
should be considered as part of the Modern and compliance built in. Producers can market
Manufacturing Fund grants program. directly to overseas customers, reducing
inefficiencies and providing more value through
Recommendation: Smart Contracts and DeFi features. Due to the
complex, ecosystem wide engagement and
• Create a Robotics Commercialisation and implementation that would be required, an
Acceleration fund under the framework Industry oversight body and a set of standards
of the National AI Commercialisation would be required in order for such initiatives to
Hub as recommended in the AI chapter. be successful.
Recommend a distinct AgTech allocation
under the Hub. Regional Innovation Centres could assist in
providing proof-of-concept and minimum-
viable-product studies for ecosystem members,
Regional Innovation Centres - a Case Study aligning with the industry oversight body.
in AgTech best practice Synthetic Biology.
Agri benchmark,5 a joint initiative between AgTech is also providing the ability to create
several European Government, Industry, new segments and industries such as the new
research and investment organisations, was protein space. New technologies such as
showcased at the recent Global Forum for synthetic biology compete directly against
Food and Agriculture as being an example traditional proteins. The companies Fable Food
of global best practice through its focus on Pty Ltd6 and v2food Pty Ltd7 are examples of
cross-skilled and cross-functional collaboration alternative protein manufacturers who are
and focus on comprehensive scientific and in direct competition with traditional meat
commercialisation methodologies. and livestock producers. This provides an
There are two prime examples of how a opportunity for traditional producers as there is
regional innovation centre could commence always more demand than supply for protein.
work on the latest technologies available to The increased competition and diversification
Agriculture. For example: in the protein sector helps to meet demand
and lower prices. Inputs for alternative proteins
Supply Chain Traceability include soy and legumes. The dramatic
increase in demand for these inputs provides
Over the last 18 months, there has been a rise new market opportunities for broad acre
in second generation AgTech offerings such as farmers who may be seeing reduced yields
Agridigital in the grain industry, which is a supply who can now sell directly to the alternative
chain traceability offering, however there is protein producer for value add.
5
http://www.agribenchmark.org/home.html
6
https://fablefood.co/
7
https://www.v2food.com/
Growing Globally Competitive Industries 15Regional Innovation Centres could assist from across the ecosystem reported that there
growers and producers in understanding is a need for an integrated, ‘single pane of
changing market demand and options to glass’ technology platform. Further, sensors and
maximise returns on investment in terms of types hardware need to be fit for different purposes
of proteins and other produce. (due to the lack of standardisation as per the
above) needing relatively large amounts of
In summary, the creation of Regional upfront capital.
Innovation Centres will bring the various AgTech
stakeholders together, using incubator-style Recommendation:
engagements, connecting RDCs, start-ups with
research, Industry, and investors to improve • Department of Agriculture to work with
commercial outcomes. Establishing Regional Industry and Standards Australia to ensure
Innovation Centres would not only bring a standardisation in areas such as sensors and
much-needed AgTech focus on evolving hardware facilitating interoperability and
technologies, it would also bring economic easy adoption.
development to regional areas whilst enabling
technology and the beneficiaries to work to Scalability
improve industry outcomes.
Reaching scale for AgTech innovators, start-ups
Recommendation: and scale-ups is a challenge due to the various
nuanced requirements across agribusinesses.
• Provide funding to conduct research Barriers for entry are incredibly high requiring
and business case establishment into access to diversified markets in order to
establishment of a pilot AgTech Regional become viable and thriving businesses.
Innovation Centre to bring the various
AgTech stakeholders together, using Currently there are two main mechanisms by
incubator style engagements, connecting which AgTech start-ups and innovators are
RDCs, start-ups with research, Industry, and able to secure funding, Private capital and
investors to improve commercial outcomes. Venture Capital investment, or via the Research
Development Corporations (RDCs). Further to
this, start-ups need to raise significant venture
capital which leads to high expectations
Challenges facing adoption of AgTech
around agtech business models. Given the lack
Innovations of traction in building a thriving AgTech industry
in Australia, these mechanisms need to be
The AIIA has identified two key challenges for addressed.
AgTech in Australia. The challenges include:
• Lack of interoperability An example of why additional support is
• Reaching scale required in these early stages of growth of
AgTech start-ups is evident when one evaluates
Lack of interoperability and standardisation the impact of Venture Capital influence
on the evolution of product development.
Many leading AgTech innovations and Start- Currently, for Venture Capital-backed
ups involve a combination of software and AgTech business, in order to continue to fund
hardware in order to deliver the proposed product development and market growth,
solution. Many of these solutions involve early-stage start-up/scale-ups in the AgTech
sensors which are needed in order to capture, business often are encouraged to monetise
analyse and manage the various data points their customers (ie. farmers’) data. Farmers
from across the operation. Currently, there is have been reluctant to allow their data to
no standardisation across these sensors and be monetised however, thereby inhibiting the
systems, leading to farmers needing to use uptake of certain innovations. An example of
disparate systems, sensors and platforms such this is Digital agricultural services (DAS) which
as satellite systems. Many of the interviewees was in the position of providing digital satellite
Growing Globally Competitive Industries 16imagery. The business model relied on providing Given the lack of traction in evolving innovation
captured data to third parties for purposes and technology for Agriculture in Australia, a
such as insurance risk analysis, which created review of this state of affairs should take place
negative perceptions among the farmers as should ensuring appropriate distribution of
involved. This ultimately then creates a sub- these funds to maximise alignment to building a
optimal business case that encourages further vibrant AgTech industry in Australia. 8
investment, thereby limiting growth and viability
of the business. Recommendation:
Recommendation: • A review of the $1.2bn a year in levy funds
which is currently distributed between
• Create a dedicated AgTech funding stream the 15 Australian Rural Research and
of $10million within the Department of Development Corporations (RDCs)
Industry ‘Entrepreneurs’ Program. for research to ensure alignment to
development of AgTech innovation and
There are 15 Australian Rural Research and commercialisation
Development Corporations (RDCs) for research
into the Agricultural Industry. The federal
Government matches those funds with a 1:1
ratio, which equates to $1.2bn of funding.
Managing slowing
productivity growth is
critical to driving the
economic performance
of the industry.
Image by No One Cares on Unsplash
8
https://www.agriculture.gov.au/ag-farm-food/levies/publications/levies_explained
Growing Globally Competitive Industries 17Health Image by National Cancer Institute on Unsplash
Introduction Australia’s response has been hampered by the
federated structure of government meaning
When the Spanish Flu Pandemic swept the mandating a national approach is difficult.
world in 1918, government responses globally
relied on isolation, quarantine, good personal In comparison, Australia’s lack of investment
hygiene, use of disinfectants, and limitations of in a national approach to health technology,
public gatherings. In 2020, despite advances made it difficult to deliver the data sharing and
in technology, Australia was forced to follow national innovation required to better manage
the same path with a lack of standards, the pandemic.
interoperability and agile decision making
processes hampering the use of technology to It is not too late for Australia to recover this
help manage outbreaks despite its potential. leadership position and once again be a
thought leader and direction setter in health
The advancement of health through digital care, but it will need the combined efforts of
technologies in Australia has seen many Territory, State and Federal Governments, and
improvements for patients, health professionals Industry.
and funders for example with the rapid
acceleration of adoption of telehealth, virtual This focus is warranted especially when the
care and e-prescriptions. However, Australia health industry is providing the biggest jobs
is in its infancy in terms of levels of digital growth in Australia, with employment expected
health development and deployment when to increase by 12% or 200,000 between 2020
compared to the more advanced countries. and 2024.11 Technology, automation, and
Artificial Intelligence (AI) are driving change
The World Index of Healthcare Innovation ranks in health across the world, making it vital the
Australia as 26th out of 31 countries for Science Australian government focus on this area in
and Technology, citing restrictions on the use order to create a globally competitive health
of new technologies as a major barrier to industry and workforce, delivering leading edge
innovation.9 health services and systems.
Adding to this, the recent “Wild Health The AIIA believes that through a combined
Webinar”10 revealed the US and UK are now set of initiatives, Australia can lead the way in
in front of Australia from a digital health health by establishing a common technology
perspective and are moving much faster framework with associated policies and
towards a more interoperable ecosystem processes that delivers a:
because of COVID19 induced digital health 1. Digital solutions to transform health care;
innovation as well as making critical significant
investment in technologies, policies and 2. National Platform to drive collaboration,
industries 3 to 5 years ago that would enable a standards, cyber security and
consistent, high performing base for provision of interoperability;
Health Care. 3. Revised Industry Health Funding Models;
and
For example, the UK’s National Health Service 4. Re-engineered and 21st Century My Health
cloud-based solutions like Carenotes allowed Record.
staff to view and share patient medical records
from a desktop or mobile device anywhere
in the UK, while in the US the implementation
of Fast Healthcare Interoperable Resources
standard provided similar data sharing
capabilities. While New Zealand implemented a
national COVID-19 vaccination booking system
9
https://freopp.org/australia-health-system-profile-11-in-the-world-index-of-healthcare-innovation-164225723e08
10
https://wildhealth.net.au/why-the-uk-and-us-are-now-in-front-of-us-in-digital-health/
11
https://nationalindustryinsights.aisc.net.au/industries/health
Growing Globally Competitive Industries 19Digital solutions to transform health care Cloud-based contact tracing was able to be
quickly implemented with citizens, on average,
As noted, the advancement of health starting self-contact tracing within 12 minutes of
through digital technologies has seen some getting a positive notification. It will also allow
improvements and one of the very strong for the easy adoption of a digital Vaccination
indicators to come out of the COVID19 passport when the decision is made to
pandemic is that as a society we have implement it.
no choice other than to accept digital
technologies. The government needs to ensure In the US, providers and vendors had been
they have the policies and frameworks required working for four years to comply with regulatory
to move quickly on making the right technology requirements for interoperability, including the
decisions. implementation of nationwide standards and
mandatory FHIR interfaces.
Digital technology is extremely important to
Health for the following reasons: As a result, data sharing capabilities were well
established, allowing health care providers,
• Greater Access - Developing, promoting,
suppliers and patients to have good access to
and making available various channels
health data.
through digital solutions and platforms give
more of the community access to health
In New Zealand, the government implemented
services via private and public health
NZ COVID Tracer app to help to speed up
providers.
contact tracing by allowing app users who
• Greater Efficiency - Digital implementations have been exposed to the virus to alert their
and transformations are being deployed own contacts. They also successfully rolled out
in small and large health organisations a national COVID-19 vaccine booking system
(such as hospitals) to streamline processes, and just recently, started trialling an app that
avoid replication and reduce the cost of may provide early detection of COVID-19.
healthcare with implementations done in
an agile and manageable way. Many state In all these cases, a high level of digital
governments in Australia have become preparedness gave these countries the
risk adverse to health technology projects ability to innovate, share and communicate
which are holding the country - and care of information much more readily and implement
patients - back. more rapidly.
• Mobility - The public are more connected
now than they have ever been in history In contrast, Australia’s lack of standards and
and the technology behind smartphones interoperability was exposed, as some of our
allows them and service providers to governments struggled to develop, implement
connect on many levels, anywhere at any and make use of technology in managing the
time of the day. pandemic.
• Assurance - Using digital to put in place
seamless, traceable, auditable, health The lack of coordination and a national
service provision that provides solid approach to QR codes and contact tracing
assurance. has exposed the fault lines in our federated
model and inconsistencies which negatively
In the UK, the implementation of a “Cloud
impacts on both patient outcomes (saving
First” policy three years ago had driven health
lives) and the economic cost of lockdowns.
care providers to adopt web-based solutions.
So, when the pandemic hit, they had the
infrastructure to enable wide uptake of video
Telehealth and NHS cloud-based solutions like
Carenotes allowed staff to view and share
patient medical records from a desktop or
mobile device anywhere in the UK.
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