Australia Releases Plan to Guide AI Development Nationally

A new national plan from the Australian government aims to ensure the economy benefits from artificial intelligence (AI) while protecting people from the risks associated with its use.

Industry Minister Tim Ayres said the plan charted a path for an Australian economy that captured AI’s opportunities, spread its benefits and kept Australians safe.

The scheme has been under development since last year, when the government announced in August that it was making AI a national priority as it consulted on copyright law changes to protect creative industries from threats posed by the technology.

Ayres said the plan would give clear guidance to government, industry, researchers, and communities, ensuring all Australians benefit from AI. It was part of the government’s Future Made in Australia agenda and would help create high-value local jobs, he said.

“The National AI Plan is about making sure technology serves Australians, not the other way around,” he said in a statement.

“Building a workforce equipped to create the infrastructure, develop AI solutions and apply them effectively is critical to unlocking the full economic and social potential of this technology. This plan is focused on capturing the economic opportunities of AI, sharing the benefits broadly, and keeping Australians safe as technology evolves.”

The government has committed $29.9 million to establish an AI Safety Institute in 2026, which will undertake official monitoring and response to AI risks, supporting agencies and regulators.

The minister said workers and unions will “play an important role” in shaping the uptake and adoption of AI, along with government and industry.

Business Council of Australia (BCA) Chief Executive Bran Black welcomed the release of the plan, saying it underscores the central message the BCA has championed: that Australia must now move quickly to deliver the enabling infrastructure that AI adoption requires.

The BCA is also concerned about the many references in the plan to regulating AI in the workplace, which it says could limit the potential benefits to the broader economy and workers in particular.

“Australia already has comprehensive workplace, privacy, anti-discrimination and safety laws that provide world-leading safeguards,” Black said.

He brought up the NSW Digital Work Systems Bill as an example of what the Council believes is a poor approach to regulation, as it gave “broad new rights for union access to systems, including personal data.”

Digital Industry Group (DIGI) Managing Director Sunita Bose said the plan brought clarity to the government’s approach.

“Realising the significant economic and social opportunities of AI requires thoughtful regulation that strengthens national capability and supports responsible innovation. DIGI welcomes the focus on building a strong and safe AI ecosystem for Australians, including through the establishment of an AI Safety Institute,” she said.

“Collaboration between industry and government will be essential to help drive responsible innovation and strong social and economic outcomes.”

Local technology services provider Datacom described the strategy as a critical step toward boosting national productivity, given new research shows many Australians feel unprepared for the rapid rise of the technology.

The company’s latest report, “The Productivity Pivot: AI, People and the Future of Work,” revealed that, while 73 percent of people agree AI will boost their efficiency, 71 percent also feel they need to boost their tech literacy.

Laura Malcolm, managing director of Datacom Australia, said the government’s plan aligns with the urgent need to upskill Australians.

“Productivity growth has stalled, and the pressure to do more with less is mounting. AI—particularly agentic AI—presents a timely opportunity to reverse this trend, but only if we bring people along on the journey,” she said.

The research also showed that while nine in ten (91 percent) of employers say they are encouraging employees to use AI for regular work tasks, just 50 percent are doing so in their day-to-day activities at work, and just one in three (33 percent) had received any technology skills training in the past 12 months.

“Australians are open to using AI, but many don’t feel ready,” Malcom said.

“The plan is a welcome signal. Now we need coordinated action across policy, industry, and education to ensure people have the skills and confidence to adopt AI safely and effectively. This is a moment to ensure AI augments the work people do, not replaces it.”

Academics have also indicated broad approval for the plan, but they, too, warn that rapid skills development is needed to avoid jobs disappearing.

‘Economic Cliff’ Ahead, AI Expert Warns

Australian Laureate Fellow Professor Geoff Webb, of Monash University’s Department of Data Science and AI, said the plan showed the government is “striking a sensible balance by holding off on potentially stifling legislation before the true gaps in existing laws are properly understood.”

“Australia is sleepwalking toward a potential economic cliff. In the worst-case scenario, AI services provided by international corporations will replace workers, greatly decreasing the number of [people] bringing income to Australian households. Instead, businesses will send fees for services offshore,” he said.

He warned that to prevent this, Australia needs to immediately invest in upskilling its workforce, a point also made by his colleague Professor Shonali Krishnaswamy, director of the Monash AI Institute.

“There is a real demand for an AI-skilled workforce. Increasingly, we will need ‘AI bilingualists’—people who are fluent and conversational in AI and fluent and conversational in their own domain, for example, finance, logistics or healthcare. Australia will need to invest in formal education, microskills, and on-the-job training to rapidly build this workforce,” Krishnaswamy said.

Meanwhile, technology insights company Gartner has warned that over 40 percent of agentic AI projects will be cancelled by the end of 2027 due to escalating costs, unclear business value or inadequate risk controls.

It also predicts that at least 15 percent of day-to-day work decisions will be made autonomously through agentic AI by 2028, up from 0 percent in 2024.