A White Paper by the Australian Information Industry Association

A White Paper by the Australian Information Industry Association

          Powered by Australia’s innovation technology

   A White Paper by the Australian Information Industry Association
A White Paper by the Australian Information Industry Association
Introduction												                                                                       1

Steering Committee 										                                                                  3

Summary of Recommendations								                                                             4


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


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.

This white paper does not necessarily reflect the views and recommendations of individual members
of the White Paper Steering Committee.

Growing Globally Competitive Industries
A White Paper by the Australian Information Industry Association
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
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.


Growing Globally Competitive Industries                                                                                             1
A White Paper by the Australian Information Industry Association
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
                                                      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

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

Growing Globally Competitive Industries                                                                 2
A White Paper by the Australian Information Industry Association
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,
 • 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
A White Paper by the Australian Information Industry Association
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
   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.

 • 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
A White Paper by the Australian Information Industry Association
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.
                                                   • 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
A White Paper by the Australian Information Industry Association
• 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.
                                                       • 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
                                                         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
A White Paper by the Australian Information Industry Association
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.

Growing Globally Competitive Industries                                                             7
A White Paper by the Australian Information Industry Association
• 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                                                             8
aligned 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.

 • 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            10

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.

Growing Globally Competitive Industries                                                                      12
Agriculture’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

Growing Globally Competitive Industries                                                                                             13
called ‘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                                                                 14
an 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.

Growing Globally Competitive Industries                                                               15
Regional 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                                                           16
imagery. 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


Growing Globally Competitive Industries                                                                                     17

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;
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

Growing Globally Competitive Industries                                                                                  19
Digital 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
                                                  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.

Growing Globally Competitive Industries                                                           20
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