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Australia and AI

The next decade
January 28, 2026 by
Australia and AI
Paul Vella


To capitalize on the growth in the AI economy over the next 10 years, Australia needs a comprehensive strategy focused on investment, skills, and governance. This strategy should address key areas, including research and development, workforce training, and a balanced regulatory framework.


1. Boost AI Investment and Infrastructure

Australia must significantly increase public and private investment in AI research and development (R&D) to secure its position as a global leader. A key focus should be on building a robust AI infrastructure that can support this growth.

  • Increased R&D Funding: The government and private sector should invest in AI research, particularly in areas where Australia has a competitive advantage, like healthcare, agriculture, and mining.4
  • National AI Capability Plan: A long-term, coordinated plan is needed to guide investment and support for the AI ecosystem.5 This includes identifying and nurturing key areas of growth and ensuring funding is strategically deployed.
  • Infrastructure Development: Building and expanding high-performance computing resources and AI data centres is critical.6 This infrastructure is the backbone of the AI economy and will be essential for both research and commercial applications.
  • Support for Start-ups: Providing targeted support, like grants and venture capital, to local AI start-ups and small to medium-sized enterprises (SMEs) will help them innovate and scale their businesses, creating new products and jobs.

2. Develop a Skilled AI Workforce

A skilled workforce is the most critical component for a flourishing AI economy. Australia needs to not only train a new generation of AI specialists but also equip the existing workforce with the skills needed to adapt.

  • Education and Training: Incorporate standardized AI and data science courses into all levels of education, from primary school to university. This will build a foundation of AI literacy for the future workforce.
  • Upskilling and Reskilling: Provide widespread training and retraining pathways for the existing workforce. This is crucial for workers whose jobs may be augmented or disrupted by AI. The focus should be on “human-centric” skills that complement AI, such as creativity, critical thinking, and collaboration.
  • Attract Global Talent: Implement skilled migration reforms to attract top-tier AI and tech talent from around the world. This will help fill critical skills gaps while the domestic workforce is being developed.
  • Industry Collaboration: Foster stronger partnerships between academia, government, and industry to ensure that educational programs are aligned with the needs of the market. This will help create a direct pipeline from education to employment.

3. Establish a Clear Regulatory and Ethical Framework

To foster public trust and encourage responsible adoption, Australia needs a clear and balanced regulatory framework that addresses the risks of AI without stifling innovation.

  • Mandatory Guardrails for High-Risk AI: Introduce mandatory guardrails for the design and deployment of AI in high-risk settings, such as healthcare, finance, and legal services. This protects consumers and promotes public confidence.
  • Adapt Existing Laws: Instead of creating a patchwork of new laws, Australia should first clarify and strengthen existing legislation, such as consumer protection, privacy, and anti-discrimination laws, to address AI-specific issues.
  • Data Governance: Improve secure data-sharing frameworks to enable innovation while protecting personal information. This includes developing clear policies on the use of personal data for AI training and ensuring compliance with privacy obligations.
  • AI Safety Institute: The establishment of an AI Safety Institute would focus on technical AI safety, international cooperation, and developing best practices, ensuring Australia’s approach to AI is both responsible and globally aligned.

Sources

LMM Threat Landscape