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Author: James Riley

  • CleanTech sector welcomes NSW emissions push

    The NSW Government has unveiled a $750 million program to help reduce the state’s emissions by promoting low emission technology and low carbon industries.

    NSW has committed to net zero emissions by 2050, like every Australian state and territory. But NSW is aiming to achieve a 35 per cent reduction in emissions compared to 2005 levels by 2030.

    At the federal level, Australia’s 2030 target is less ambitious at 26 to 28 per cent, and Prime Minister Scott Morrison has so far declined to commit to a 2050 target.

    cleantech
    Green as: The CleanTech sector loving NSW minister Matt Kean’s emissions transition

    Unveiled by NSW Energy Minister Matt Kean at Port Kembla near Wollongong on Monday, the NSW Net Zero Industry and Innovation Program, is a “cornerstone” of the first phase of the state government’s 2050 Net Zero plan and is aimed at existing heavy polluters.

    Most of the money ­­– $380 million – is for grants and government co-investments for existing heavy polluting industries to re-tool with low emissions alternatives.

    Funding will be allocated to facilities undertaking major capital upgrades of plant and equipment.

    A further $175 million is earmarked for ‘low carbon industries’ such as green hydrogen. The remaining $195 million will go to R&D focused on new clean technologies for decarbonization.

    “Almost 30 per cent of our State’s carbon emissions are created by our top 55 industrial facilities, which are critical contributors to the NSW economy,” Mr Kean said at a press conference held at BlueScope Steel, Australia’s 15th largest corporate emitter.

    “Supporting their move to cleaner equipment, technology and processes will significantly reduce emissions, while helping to protect jobs and maintain a resilient economy.

    Allume Energy director and for former Clean Energy Finance Corporation director Katerina Kimmorley said the program is welcome, but in the context of global changes more was needed from policy makers if Australia is to keep pace with a rapidly decarbonising world.

    Ms Kimmorley told InnovationAus the likely introduction of carbon border adjustment mechanisms around the globe within the next two years – which operate effectively as a carbon tax on imports –meant Australian exporters would find themselves in an increasingly uncompetitive position.

    “I feel like Matt Kean is the only one actually realising that we have to quickly help our industries decarbonise so that they can maintain their competitive status internationally.”

    Mr Kean has led the development of more ambitious renewable energy and emissions reduction strategies for the state, including last year’s Electricity Infrastructure Roadmap.

    Ms Kimmorley said the minister was effectively turning a risk into an opportunity.

    “Because we have such abundant renewables in Australia and because we actually do have some good clean tech companies that are that are coming up, if we really get behind them [we could] be a world leader and export these technologies and show other sort of regional players how we’ve done it.

    “If we get on the front foot and that’s kind of what he’s doing in my mind.”

    Carola Jonas, the founder and chief executive officer of electric vehicle software company Everty also welcomed the announcement, which she says came after extensive consultation with industry.

    “It’s a great push for renewables, a great push for transport and infrastructure,” Ms Jonas told InnovationAus.

    Like every other Australian state and territory, NSW has now “put their money where their mouth is”, according to Ms Jonas, by announcing major emissions reduction strategies and a net zero 2050 policy.

    Ms Jonas said NSW’s action would put pressure on federal counterparts to make more ambitious commitments, but pressure is rising elsewhere.

    “We’re also seeing the pressure coming out of the US now that they have Joe Biden as President, doing massive, massive investments in infrastructure when it comes to renewables and zero emission solutions.”

    However, local changes will need to come faster than many Australian organisations had anticipated, according to Kimmorley. But Australia still has a chance to be a world leader in emissions reduction technologies if it can help its biggest emitters to change.

    “Because of the scale of those businesses, they have the opportunity to really be world leaders and export this technology because they have operations around the world. So I actually think it should be seen as a release of big GDP generator for us.”

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  • Forging new pathways to STEM collaboration

    Australians know all too well the tyranny of distance – it is part of our psyche and has helped shape our ability to overcome challenges many of our international counterparts would have never encountered.

    An island nation, distanced from the world’s business and cultural epicentres, our best and brightest have had to be creative when forging new pathways.

    Trailblazing mathematics scholar, emeritus professor Cheryl Praeger, recently awarded the Companion of the Order of Australia for her work in the field of mathematics over many decades, was at the pinnacle of her career in the 1970s when she encountered her first barrier to success.

    Cheryl-Praeger
    Cheryl Praeger: An internationally renowned mathematician from Toowoomba

    Following a stint at Oxford to complete a PhD and long before the internet (or even inexpensive telephone calls), Prof Praeger returned home and instantly felt the distance from international colleagues and being away from where it was all happening.

    “At the time, Australians were very different to those in oversees. I’d talk to graduates and they would play it cool and not want to talk about their work, which meant it was hard to collaborate,” Professor Praeger said.

    “I was dependent on keeping those links with colleagues internationally, and after getting married and having a couple of kids, I felt like I was losing contact with where it was all happening.”

    Professor Praeger spoke with InnovationAus Publisher Corrie McLeod as part of See What You Can Be, a series of interactive webinars championing Australia’s extraordinary female changemakers including founder of Females in IT and Telecommunications (FITT) Ann Moffat, science futurist Dr Catherine Ball and finance academic Dr Priya Dev, who are blazing new pathways across the STEM sector.

    Collaborating with contemporaries scattered across the globe meant Professor Praeger’s joint research was conducted via sea mail, an experience that seems quaint in today’s time of remote work and Zoom meetings.

    It meant a two-month turnaround waiting for a letter to get somewhere, for someone to think about it and then write a letter back. “So, I was doing many different research projects with many different people, but it was hard work and I felt left out,” she added. “These days it would have been quite different.”

    A supportive husband, and mother and mother-in-law who would share helping with the children, enabled Professor Praeger to take a six-week research stint at Cambridge, a critical step in her career.

    “It was a game changer to form new research links, intensely focus on one of the most important research projects of my life, meet new people, give lectures and attend research conferences,” she said.

    Throughout her career, she has broadened her research scope, which has been invaluable in having input into curriculum development, supervising PhD students, and eventually moving into computing through computer algebra and randomised algorithms.

    “The role and responsibility of being a professor of mathematics has been to represent my discipline and ensure teaching areas were updated all the time,” she said. “Maths is never static.”

    Today, women across the globe are being encouraged to embrace the visibility and strength that comes with banding together as a group in female STEM professionals.

    Professor Praeger has seen first-hand the changing role of women in the sector: “It’s fairly recent that female mathematicians have been happy to be identified as women as a group, and the community as a whole acknowledges that it’s good to have this diversity and that women are welcome to the sector.”

    Giving women the ability to put their gender alongside their role as mathematicians is an important choice they now have. “There are different issues that women face, like caring responsibilities and having to balance children and work, so it’s good to face these together and have the support of a group,” she said.

    Professor Praeger knows only too well that without encouragement women can be put off choosing a career in STEM. By the end of high school, she knew what she really wanted to do – study more mathematics.

    While supportive teachers and parents helped encourage her to take the next steps, a life-long career in mathematics was hard to imagine back then.

    “I didn’t know that I would be able to get a job, but I just figured I would do mathematics as long as I could,” she said.

    However, it wasn’t long before gender stereotypes kicked in and Professor Praeger was warned off her career ambitions.

    “An advisor from the government vocational guidance section told me that ‘girls don’t do maths, they don’t pass, and there are no jobs’.” Determined to press on, she completed her undergraduate mathematics degree and then a master’s degree before going to Oxford to complete her PhD.

    Today in Australia, Professor Praeger points to many fields where mathematics is essential to life changing developments. As well as physics and chemistry, it’s now biology and genomics, finance, agriculture, communications and computer security.

    “Look at the statistics that we need to understand the pandemic and we can work out what is likely to control it,” she said.

    Professor Praeger spoke with InnovationAus Publisher, Corrie McLeod, as part of See What You Can Be, a series of interactive webinars championing Australia’s extraordinary female changemakers including founder of Females in IT and Telecommunications (FITT) Ann Moffat, science futurist Dr Catherine Ball and finance academic Dr Priya Dev, who are blazing new pathways across the STEM sector.

    Find out more about See What You Can Be, where insightful women share what they have learned on their STEM journey – including success stories, opportunities and barriers to entry – while encouraging students to challenge outdated stereotypes.

    The post Forging new pathways to STEM collaboration appeared first on InnovationAus.

    This post was originally published on InnovationAus.

  • Gabrielle Upton on NSW research translation

    After more than a decade of large-scale investments in hard infrastructure, the Berejiklian Government in NSW is retooling for new levels of public investment into ‘soft’ infrastructure, with a heavy emphasis on building the state’s research translation capability.

    The state’s Accelerating Research and Development Action Plan is a signpost for a new emphasis on future industries, and future job creation opportunities. It includes as core recommendations structural changes inside government that would oversee the research translation outcomes.

    This would include the creation of an agency Research and Development NSW inside the Premier’s cluster in the Department of Premier and Cabinet.

    Research translation
    NSW government: Improving research translation outcomes is a big new focus

    The agency would operate in similar fashion to Infrastructure NSW, with a whole-of-government line of sight over major R&D investments across different clusters and agencies. In this structure, the Premier would take the lead role in research translation investments, with all the advantages that having a leader on board brings.

    In this episode of the Commercial Disco, NSW MP Gabrielle Upton – who is the parliamentary secretary to the Premier – talks about the new urgency in government about R&D, brought about in part as a bi-product of the COVID pandemic.

    Ms Upton, who led the taskforce investigating pathways to boosting R&D translation in NSW as a collaboration with the state’s chief scientist and engineer Hugh Durrant-White, says a COVID ‘silver lining’ was in the changes the pandemic had wrought on the way that government works.

    The Accelerating R&D in NSW taskforce was appointed pre-pandemic in late 2019. It overlapped slightly with the release of the state’s 2040 Economic Blueprint, which was produced by the NSW chief economist from Treasury and released in 2019.

    Ms Upton said the pandemic had highlighted areas that needed urgent attention, and opened up the political conversation toward a greater acceptance of soft infrastructure investment in areas like R&D.

    Part of this is about solving supply chain issues, and part of it is about pushing longer term economic growth goals – and up to a point about a research-enabled economic recovery.

    The Action Plan makes clear a recommendation that the state produce a Research Strategy for the state that has a 20-year horizon.

    “We do need to develop a clearer view of where our strengths are in industry and where our strengths are in research,” Ms Upton said. “We need to be clearer about what we are going to pursue in terms of industry investment and also in terms of research, and research translation.”

    Up to a point, this is about picking winners in terms of the areas of research translation that the state will make a priority. Of course, NSW has not been passive in this regard. The state has made large bets in terms of investments in quantum computing research.

    The Action Plan calls out a number of areas of strategic importance where there is both some capability and the ability to improve research translation outcomes. These include general technologies like artificial intelligence, quantum computing and advanced manufacturing, as well as in defence and health.

    But the specific audit of research strengths and capability – and where targeted investment would have the best return for research translation – a would be a part of the 20-year research strategy.

    A key recommendation is that the Premier take the lead, and the new agency Research and Development NSW be set up within the Premier’s department. Gladys Berejiklian has publicly expressed a personal interest in improving the state’s R&D translation efforts.

    “My argument to colleagues has always been that we’ve had a big focus on hard infrastructure over the term of our government – more than $100 billion invested over the forward estimates, and this [focus on R&D] is a compliment to that,” Ms Upton said.

    “In fact, it is a long-term strategy for jobs growth – which state governments always want to increase – and is best delivered through investment in software infrastructure like research and development translation,” she said.

    In advance of designing a 20-year R&D roadmap, the chief scientist and engineer together with the chief economist from Treasury are expected to host a conference or colloquium to bring together the various stakeholders across the state.

    Ms Upton said the government’s precincts strategy would play a key role in building out the accelerated R&D and research translation strategy.

    While there are about 35 nominated precincts across NSW of varying size and maturity, its three priority precincts are TechCentral around Central train station and targeting tech-enabled scale-ups; the greenfield Aerotropolis at Badgerys Creek that will target Advanced Manufacturing, AgTech, and defence, and the Westmead precinct focused on MedTech and BioTech.

    Ms Upton says the aim is to attract significant research investment into the precincts, and to embed world-class university research capability into each.

    “When we’re talking about these precincts, research translation must be a feature of investment attraction to those precincts,” Ms Upton said.

    “We might like to have the big companies with the big names, but we must be asking them to invest in research activities at those locations and to spend equal or comparable dollar on research translation and their innovation creation,” she said.

    The post Gabrielle Upton on NSW research translation appeared first on InnovationAus.

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  • $540m Business Growth Fund ready to flow

    The $540 million Australian Business Growth Fund is about to turn on the taps, with its first investment of “patient capital” expected to be made by the end of the financial year.

    First announced by the Coalition as part of the 2019 election campaign, the Australian Business Growth Fund (ABGF) will make long-term equity capital investments of between $4 million and $15 million into established Australian businesses.

    These businesses will have annual turnover between $5 million and $100 million, with three years of proven revenue growth and profitability, taking into account the impact of the COVID-19 pandemic.

    Mike Baird
    Mike Baird: Chairman of the new Australian Business Growth Fund

    The fund, which will operate commercially and independent from the government, will take minority economic interest of between 10 per cent and 40 per cent in the companies it invests in.

    The government has stumped up $100 million of Commonwealth money to the fund, along with the big four banks, HSBC and Macquarie have also contributed $20 million each, bringing the fund’s initial size to $540 million.

    The government has a longer-term goal to grow the fund to $1 billion.

    More than two years after being announced, and a year after legislation unlocking the Commonwealth funds, the ABGF is now up and running, and is expected to make its first investment by the end of June.

    Before any investment was made, the fund had lost its inaugural chair, with former Tasmanian Premier Will Hodgman stepping down just six months after he was appointed. Mr Hodgman has been replaced with another former state leader, with ex-NSW Premier Mike Baird taking over as chairman last November.

    Mr Hodgman stepped down from the role after being appointed Australia’s new High Commissioner to Singapore.

    In the new role, Mr Baird will be paid an annual salary of $145,000, with the government to contribute 18 per cent of this as part of its stake in the fund.

    The ABGF shareholders agreement was signed by the seven shareholders in October last year, and it is now open for applications.

    Treasurer Josh Frydenberg said the first investment is expected in the next three months.

    “With better access to more competitive finance, SMEs will be able to grow, fulfil their potential and continue to underpin Australian economic growth and employment, including as the economy recovers from the impact of COVID-19,” Mr Frydenberg told InnovationAus.

    “Australian businesses will be eligible to apply for long-term equity capital investments between $5 million and $15 million, where they have generated annual revenue between $2 million and $100 million and can demonstrate three years of revenue growth and profitability, allowing for the impact of COVID-19 on recent business performance,” Mr Frydenberg said.

    The ABGF has the objectives to increase the availability of patient equity capital for local SMEs, to increase the level of investment in these companies, facilitate interstate and overseas trade and commerce, and support job creation and economic growth as part of the COVID-19 recovery.

    Legislation allowing the government to invest $100 million in Commonwealth funding to the ABGF was passed by Parliament last year in an omnibus bill of COVID-19 economic recovery policies.

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  • Q-CTRL to take quantum tech to the Moon

    Local firm Q-CTRL will send its quantum tech to the Moon as part of an Australian consortium working on NASA’s Artemis program.

    The Sydney-based startup has developed quantum sensing and navigation technologies that can be applied to space exploration and has teamed up with the Seven Sisters space industry consortium to send them to space as part of an uncrewed mission to the Moon in 2023.

    Seven Sisters is aiming to send nanosatellites and exploration sensors such as those offered by Q-CTRL to the Moon to search for water and resources as part of an unmanned mission next year, in support of NASA’s Artemis program.

    Artemis is aiming for a human mission in the following year, with a longer-term aim of creating a sustainable human presence for later crewed Martian exploration.

    The quantum technology will allow for enhanced precision navigation and timing, providing guidance for long-endurance missions with limited telemetry contact, Q-CTRL chief executive Professor Michael Biercuk said.

    “Our focus on quantum control engineering is enabling new applications in quantum sensing that were previously impossible,” Professor Biercuk said. “Quantum control is enabling small form factors, enhanced robustness and the necessary autonomy to meet the strict requirements of uncrewed space applications.”

    “Quantum-control-defined sensors give us the ability to provide valuable new geospatial intelligence services – whether on earth or on celestial bodies.”

    Q-CTRL’s technology will be used to detect liquid and mineral deposits remotely using its quantum-based gravity detection and magnetic field sensors.

    The Seven Sisters group was founded by nanosatellites startup Fleet Space Technologies, and includes a range of companies and academic institutions working on advanced exploration tech for Earth and the Moon.

    “We wish to welcome Q-CTRL to the existing world of space exploration. They have the proven expertise to deliver advanced quantum technology solutions that will enable our missions to achieve goals that would otherwise have been unattainable,” Fleet Space Technologies chief executive Flavia Tata Nardini said.

    South Australian Premier Steven Marshall said the partnership is an important step in the growth of the local space sector.

    “This ground breaking application of autonomous quantum sensors in space exploration will be invaluable in leveraging extra-terrestrial resources to establish permanent human bases on the Moon, Mars and beyond,” Mr Marshall said.

    “It demonstrates Australia’s growing global leadership in both the quantum and space industries, establishing a solid foundation for future economic growth.”

    Q-CTRL will be using the space mission as a way to develop and test its technology, and is also planning to offer it for commercial applications in the defence, finance and climate change mitigation sectors.

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  • Manufacturing Fund opens for critical minerals

    The $1.3 billion Modern Manufacturing Fund is now open for rare earth and critical minerals projects as the government looks to “hard-wire” Australia into the global supply chain of the crucial resource.

    Prime Minister Scott Morrison and Industry Minister Karen Andrews on Thursday morning unveiled the national manufacturing roadmap for resources technology and critical minerals, and announced that applications to the federal government’s $1.3 billion Modern Manufacturing Fund were open for the sector.

    The commodities are used to manufacture tech products such as smartphones, computer chips, solar panels, electric vehicles and a range of defence technologies.

    Karen Andrews
    Karen Andrews: Modern Manufacturing Fund opens for rare earths and critical minerals

    The government has outlined six areas of manufacturing priority that its manufacturing fund will focus on, with space, medical product and resources tech and critical minerals processing projects now able to apply, and food and beverage, recycling and clean energy and defence to open in the coming weeks.

    Businesses will be able to apply for funding to help commercialise ideas or processes, or to integrate into global supply chains.

    The fund is the centrepiece of the Coalition’s $1.5 billion Modern Manufacturing Strategy, unveiled in October last year, and includes translation and integration streams.

    Increasing Australia’s output of critical minerals and commercialise of ideas around them is a strategic priority for the government, Mr Morrison said.

    “It’s not a new issue for us, for some time now our government has been working very closely, whether it’s with the US or Japan, about how we can fill in the supply chains around critical minerals and rare earths,” Mr Morrison told the media on Thursday.

    “It is a sovereign and strategic priority for Australia to ensure we are hard-wired into this supply chain around the world, a supply chain that Australia and our partners can rely on. Rare earths and critical minerals is what pulls together the technology that we will be relying upon in the future.”

    The fund will be looking to provide capital to organisations looking to add value to the resources extracted in Australia before they are sent around the world, Ms Andrews said.

    “Australia has a very long history of being a resource rich nation where we have done extraordinarily well at digging that product out of the ground. The part that has been missing is the value add,” Ms Andrews said.

    “We have been very good at digging it out of the ground but it’s sent overseas and processed and then we pay an extraordinary amount of money to but that back in Australia. We want to change that. We are already world-leading but there are significant opportunities for us to expand that even more.

    “We have an abundance of critical minerals here in Australia, we have incredible stores of lithium. At the moment, we aren’t processing that to any great extent in Australia,” she said.

    “Through the roadmap we want to set a pathway where Australia can recover the maximum amount of lithium and then look at how we can value-add to that, and how we can build the battery industry right here in Australia. This is an enormous opportunity.”

    The opening of the fund for critical minerals was welcomed by the chief executive of industry growth centre METS Ignited, Adrian Beer, who said it and the accompanying roadmap “provides the Australian technology and innovation sector the opportunity to commercialise this capability within our local economy”.

    “This announcement provides Australian technology innovators the opportunity to access funding that will enable them to productise and commercialise their solutions that serve our local economy,” Mr Beer said.

    “By harnessing the skills and capabilities that drive the strength of our global resources sector, and converting this capability into products and services to benefit both our resources sector and our other priority sectors, we will realise the return on investment into our world leading research sector.

    “We welcome this announcement from the Australian government as a turning point to drive economic value from the technology within our resources sector and creates valuable products for both local and export markets.”

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  • Full steam ahead for sub project construction

    With the design phase of Australia’s new Attack class submarines underway and a new shipyard being constructed in Adelaide, Dr Gregor Ferguson takes a hard look at the project and its many critics. No, nuclear is not an option, cost rises have been exaggerated and the project is on schedule.

    The Royal Australian Navy’s Future Submarine project, SEA1000, has attracted an astonishing amount of comment and criticism, much of it from people who don’t seem to have done the necessary reading, or who are pushing barrows of one form or another.

    Opinions and assertions seem to be swamping the facts and leaving an unrealistic impression of the project.

    submarine
    Australia’s attack class submarine Photo credit: Naval Group

    There’s a train of logic that puts us where we are today, and it’s not hard to follow.

    Before talking about things like costs and schedules, let’s look at the need for a submarine and then the choice of submarine designer and builder.

    Firstly, do we need a long-range submarine with significant endurance? Yes. Our geography is uncompromising: Australian submariners need to travel a long way to get to work and back.

    Secondly, should we build or buy nuclear powered submarines, with their proven range and endurance, in that case? No. We are a non-nuclear nation. We don’t have the nuclear industry and trained nuclear engineers we need to support nuclear power stations, re-processing plants and submarines.

    There’s actually a law against establishing such an industry in this country. There has just been a small attempt to start a national debate on changing the law and introducing nuclear power but until the Commonwealth wins the debate, both in public and in Parliament, about introducing nuclear power to Australia, we shan’t have nuclear power in this country and so will be unable nation to operate and sustain a nuclear-powered submarine safely.

    Forget about buying or leasing boats from the Americans, British or French, for two reasons: firstly, we couldn’t contemplate leasing one of our critical sovereign defence capabilities from another country – that goes right against the principle of sovereignty. We’d lose control over it, especially if the parent nation was undertaking maintenance.

    Secondly, nuclear-powered submarines are critical sovereign assets for the Americans, British and French – they wouldn’t simply transfer a batch of them to Australia as a favour to a mate.

    The third step on our train of logic is that we can’t buy the submarines we need off the shelf. Nobody who builds diesel-electric boats faces our geographical challenges, so their off the shelf boats simply don’t have the range and endurance that we need.

    There’s no point in buying a submarine that can’t do the job – you’d be better off not spending the money at all. Which means we have to go for a unique design.

    So why is it taking so long to get the submarines built?

    Well, compared with what? There is no quick way to design a new submarine from scratch. The Attack-class boats are not simply nuclear submarines with a new motor and batteries.

    They are an all-new design, with a nuclear boat of roughly similar size and weight as a design reference – that simply means a lot of the structural engineering problems have been addressed already, so the designers don’t need to re-invent the wheel every time they encounter a technical problem. But it still takes time to go through an extraordinarily complex design process.

    Besides, the timescale for their delivery was imposed by a previous government which announced a 12-boat program in 2009 and then did absolutely nothing about it for six years – six years that we won’t get back.

    Cancelling the submarine project and starting again would just cost us more time, or force us into buying an off the shelf boat that can’t do the job the Navy needs in an attempt to claw back schedule.

    As for the project’s schedule, where did the idea spring from that the project is running years late already?

    Yes, the Strategic Partnering Agreement (SPA), which is the umbrella agreement under which all future contracts will operate, was signed a few months late in February 2019.

    But the $375 million Submarine Design Contract was signed roughly on time in March of that year. An AFS Intermediate Design Review took place in April 2020 and the System Requirements Review was completed on time earlier this year.

    The program is on schedule and even the Australian National Audit Office (ANAO), which does Defence very few favours, acknowledges this.

    What about costs? Defence hasn’t done itself any favours by tripping over its own tongue on this issue, from what I can see.

    The February 2016 Defence Integrated Investment Program (DIIP) stated that the acquisition cost of the submarines was estimated to be around $50 billion, and this price has been used as an estimate ever since – at 2016 values.

    Quoting estimates of estimated out-turned prices at then-day exchange rates and dollar values 30 or 40 years ahead has spooked the commentators and raised fears that the project costs are spiralling out of control.

    I think the price issue has been beaten up by some and conflated by others, for a few reasons.

    Firstly, while there is an estimated cost for the construction of 12 boats, including the construction of a new yard and the design and build of a new combat system, there is no contract as yet to build even one. There is a design contract, signed in March 2019; the first construction contract won’t be signed for a couple of years yet.

    Secondly, the 12 boats will be constructed in batches of three or four. Each batch will differ from the one before – it’ll incorporate new technology and design features so it’s impossible to predict the exact cost of each batch and therefore the total cost of the submarine project. This would be the case whichever bidder had been selected.

    We do know the basic design won’t change much between batches so the cost of manufacturing the hulls and propulsion systems, for example, should fall significantly as we get better at building them – look at our performance on the 10-ship ANZAC frigate project. It’s the technology inside them that will change regularly – as has been the case with the ANZACs since they were launched.

    Thirdly, for this reason nobody was asked to tender a price for building 12 boats. The Competitive Evaluation Process (CEP) was not a tender – it could never have been and critics of the project should read the ANAO report on the CEP, published in 2017.

    Defence has refused to disclose the detail of the contenders’ response and has said only that they didn’t vary sufficiently to make one or other of them a compelling bidder. If reports are true, the ultimate choice was made on submarine capability grounds and the French design was judged superior in this regard.

    Finally, the DIIP’s project estimate of $50 billion, give or take, was in print well before Naval Group (DCNS as it was known at the time) was selected. Whatever they (and the other contenders) put forward was one component of a $50 billion cost estimate that hasn’t been revised since the selection of Naval Group back in 2016.

    The other components include a major upgrade of the construction yard at Osborne and the combat system which is being supplied by Lockheed Martin.

    So, the costs haven’t suddenly escalated. The project is roughly on schedule. The Navy’s operational requirements haven’t been challenged, but there has been some woefully unrealistic commentary around the acquisition of nuclear submarines, or the idea of simply cancelling the project and starting again.

    Yes, nuclear boats would be nice – and no, we’re not going to get them for at least a generation, in my view. If commentators want nuclear submarines, they should start by convincing our Parliamentarians that we need nuclear power and a nuclear industry in this country.

    Starting all over again would simply delay the project. To what purpose? We’d end up with either an off the shelf boat that can’t do what the Government, and Navy, want it to do, or we’d have an interminable wait for another all-new submarine.

    Now can we please get real?

    Gregor Ferguson is director of Project Alpha Plus, a defence and innovation analyst, consultant and communicator who has worked in the defence media and industry for more than 30 years. His PhD is in defence industry innovation.

    This story was originally published by @AuManufacturing. You can subscribe to its newsletter here.

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  • Our SME policy obsession is not working for us

    It might be time for a rethink of Australia’s obsessive focus on small and medium-sized (SME) tech companies in relation to government procurement. The focus should be on Australian companies – regardless of size – building sovereign capability.

    In Defence, where this SME engagement policy on mega-projects is more rigidly applied to build sovereign capability in areas of strategic importance, this SME focus has enjoyed some success. This is because sovereign capability is a key part of the procurement goal.

    This is not the case in relation to information technology, and the supposed flow-on effects for positive industry development outcomes are noticeably diluted.

    Canberra Parliament
    Sovereign capability: Australian companies of any size building Australian capability

    In the case of tech, there is literally no evidence that this focus on SME engagement in government procurement has ever worked. If the goal of the focus on SME’s has been to turn small Australian companies into large internationally competitive companies, then it has not worked.

    For decades, in one guise or another, various governments in Australia have sought to encourage the large multinationals that dominate the government technology landscape in this country to engage with local SME’s when bidding for big public contracts.

    The thinking has been that by earning this kind of government work, these SMEs would get a foothold into the market.

    Having been gently nurtured under the protective wing of a friendly giant, these small Australian tech companies would become large. So, where are they?

    The evidence is in. Governments carrying on about SMEs does not work. It’s time to move on. The focus should be on building sovereign capability and sovereign capacity. That mean a positive weighting in tech procurement should be applied to Australian companies, regardless of size.

    This would mean emulating US government policy in this regard. Imitation is the sincerest form of flattery after all. Like the Biden administration, the Australian government should use its procurement dollars to build national capability.

    It would be helpful if Australian trade officials were less timid on this issue.

    It’s understood DFAT bureaucrats have been running around with their hair on fire in relation to Australian steel since President Biden signed the Made in America executive order in January. But meanwhile no attention is being applied to the tech sector – where the jobs of our future are being created.

    We need to follow the US on this issue.

    It would be helpful also for policymakers to revisit breaking up contracts into smaller components to enable Australian companies to more easily compete for government business. This was an ambition outlined as a part of ICT procurement reforms under the National Innovation and Science Agenda.

    It followed a campaign in the UK under Cabinet Secretary Francis Maude and the head of the Government Digital Service to breakup mega-projects in tech to deliver better value for money, better digital service outcomes, and to create opportunities for smaller UK companies.

    Australia jumped on board this idea, but enthusiasm waned. The Digital Transformation Agency has shown itself to be uninterested.

    So here we are. The shortlist of three vendors being looked at for Immigration’s massive visa processing project is instructive.

    The three shortlisted candidates are – drum roll please – all US-based multinationals. IBM, Pega and Oracle. IBM is understood to have bid for the business on it own. Pega has teamed with US-based Accenture; while Oracle has teamed with big four consulting giant PwC, also based in the US.

    How very Australian of us.

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  • Three tech giants shortlisted for visa platform job

    Three US tech giants have been shortlisted by the government to have another go at developing its new “permissions capability” platform to handle visa processing, after a botched first attempt that cost nearly $100 million was abandoned last year.

    The Digital Transformation Agency issued a tender for work on a “permissions capability” platform late last year, which would initially handle digital passenger declarations and digital visa processing.

    Now the government has narrowed down the tender to three potential bidders, as the Australian Financial Review reported, and each are massive US tech firms, with no Australian firms in the mix.

    People
    Tech giants: The search for a visa systems lands in a familiar place

    The three shortlisted bidders are IBM, Pega and Oracle. IBM is bidding for the work by itself, while Pega has teamed up with Accenture, and Oracle would work with PwC and Sayers.

    A final decision from the government on the platform is expected in the next two weeks.

    The selected private contractor will build the base platform that is capable of handling the digitisation of incoming passenger declaration cards and a simple digital visa application. The platform will be able to be reused across the Commonwealth, not just for visas.

    The work will be for the development of an “integrated, enterprise-scale workflow capability to be used across the Commonwealth, not just by Home Affairs”, and will be a “scalable, innovative permissions capability”.

    It comes after the government scrapped its work on a similar digital visa processing platform in March last year after having already spent nearly $100 million on it. The concept was first floated in 2017, with a tender issued in December 2018 and a winning bidder meant to have been selected by the end of 2019.

    But a series of conflicts of interest slowed the process, with the government eventually abandoning the plan last year, announced a “brand new approach” instead. Despite not yet selecting the contractor, the government had already spent more than $90 million on the project, with the bulk of this money going to private contractors.

    Boston Consulting Group scored the most of this funding, picking up $40 million for its work on the doomed scheme.

    This approach is the creation of a “visas and permits processing capability” by a private contractor.

    The original tenderer options included more Australian options, with the final two consortiums being Australian Visa Processing, which included Ellerston Capital, PwC, Qantas Ventures, NAB and Pacific Blue, and a joint bid by Australia Post and Accenture.

    The concept has been widely criticised for the privatisation of a core government function, with the Opposition saying it would have scrapped the original plan if it had won the 2019 election.

    This time around, the government has maintained that the visa processing platform will be publicly funded and operated, with the relevant government agencies to retain control of the responsibility and decision-making, and all data will be stored in Australia.

    Government services minister Stuart Robert said in July last year that the new platform was a “government priority”.

    “Government is developing a new whole-of-government permissions and permits platform which will leverage previous work in this key area, and which will deliver a modern visa and permits processing capability as a priority,” Mr Robert said last year.

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  • Lawyers Alliance wants eSafety bill scrapped

    The government’s Online Safety Bill gives “excessive discretionary powers” to the eSafety Commissioner and has the potential to provide cover for law enforcement officials, and should be scrapped entirely, according to the Australian Lawyers Alliance.

    The legislation, which is currently the subject of a whirlwind Senate inquiry after being introduced to Parliament in last month, extends the eSafety Commissioner’s takedown scheme to Australian adults, allows the office to issue removal notices for content deemed to be rated as R18+ or higher, and to then order the site or app be blocked if it does not comply.

    The bill also introduces the Abhorrent Violent Material Blocking Scheme, which gives the commissioner the power to order ISPs to block domain names, URLs and IP addresses, and will allow the minister to set “basic online safety expectations” for tech companies.

    Data
    Take-down orders: Lawyers Alliance say the Online Safety Bill should be scrapped

    A number of legal, civil and digital rights, tech companies and adult organisations have raised significant concerns with the legislation, and its potential to impact those working in adult industries, to lead to online censorship, and the vast powers it hands to a handful of individuals.

    Despite this, the legislation was introduced to Parliament just 10 days after the government received nearly 400 submissions on the draft bill, and the senate committee is expected to deliver its report nine days after submissions closed.

    Stakeholders were also given only three working days to make a submission to the inquiry.

    In a submission to the inquiry, Australian Lawyers Alliance (ALA) president Graham Droppert said the government should not proceed with the legislation because it “invests excessive discretionary power in the eSafety Commissioner and also the Minister with respect to the consideration of community expectations and values in relation to online content”.

    “The ALA considers that the bill does not strike the appropriate balance between protection against abhorrent material and due process for determining whether content comes within that classification,” Mr Droppert said.

    There are also serious issues around handing the minister the power to set “basic online safety expectations” for a range of tech companies, Mr Droppert said.

    “There is a significant risk that this will result in excessive proactive monitoring and removal of content that falls under Class 1 and 2 of the National Classification Code. It is a dangerous centralisation of power for such a broad discretion to be invested in one person, who would be determining community expectation,” he said.

    This reliance on “outdated” classification codes is also troublesome, the ALA said, the legislation should not proceed until these are reviewed and updated.

    The abhorrent violent material blocking scheme, which gives the eSafety Commissioner the ability to order internet service providers to block domain names, URLs or IP addresses could lead to important conduct being censored, the organisation said.

    “The ALA submits that the scheme as currently provided for in the bill has the potential to provide cover and protection for law enforcement officials to use excessive force out of sight from those who might seek accountability,” Mr Droppert said.

    “It is essential that this scheme not be used to hide any use of violence by the government, including by its law enforcement officials, and any abuses of human rights.”

    A number of sex industry organisations made submissions to the inquiry raising concerns that the new powers would lead to the blocking of content of consenting adults.

    “The existing classification scheme of online content fails to distinguish between harmful content and content of a sexual nature depicting consenting adults. Any expansion of the power of the eSafety Commissioner to take down content that is not harmful constitutes an erosion of freedom of expression,” Sex Work Law Reform Victoria president Lisa Dallimore.

    “It is concerning that ill-conceived clauses [in the bill] could set back hard-fought giants in sx work regulation which have largely created a safer working environment for sex workers.”

    Digital Rights Watch has been leading the charge against the legislation, with detailed submissions and calls to action.

    The powers to be handed to the eSafety Commissioner, which was established in 2015 to focus on keeping children safe online, is a continuation of its broadly expanding remit, and should be cause for concern, Digital Rights Watch programme director Lucie Krahulcova said.

    “The new powers in the bill are discretionary and open-ended, giving all the power and none of the accountability to the eSafety Office. They are not liable for any damage their decisions may cause and not required to report thoroughly on how and why they make removal decisions. This is a dramatic departure from democratic standards globally,” Ms Krahulcova told InnovationAus.

    “There seems to be a lot of political willingness to trust the eSafety Commissioner to act in good faith and stick to the intention of the legislation rather than explicitly define and limit the powers in the bill,” she said.

    “This is a naive trust in the cult of personality and risks that under any administration these powers will be misinterpreted and used to bully and marginalise individuals and movements.”

    The bill “introduces provisions for powers that are likely to undermine digital rights and exacerbate harm for vulnerable groups”, Digital Rights Watch said in the submission.

    The inclusion of class 1 content – that which would be refused classification, and class 2 – that deemed to be X18+ or R18+ – means the blocking scheme would include all sexual content, whether it is violent or not.

    “The scheme is likely to cause significant harm to those who work in the sex industry, including sex workers, pornography creators, online sex-positive educators and activists,” Digital Rights Watch said.

    The abhorrent violent material blocking scheme included in the legislation is “overly simplistic and overlooks complex underlying issues”, with Digital Rights Watch raising similar concerns that it would lead to the censorship of content that is in the public interest.

    “In some circumstances, violence captured and shared online can be of vital importance to hold those in power accountable, to shine the light on otherwise hidden human rights violations, and be the catalyst for social change,” the organisation said.

    “It is essential that this scheme not be used to hide state use of violence and abuses of human rights.”

    The minister’s ability to outline “basic online safety expectations” for social media firms, “relevant electronic services” and designated internet services, is too broad and could lead to troublesome monitoring of content, the organisation said.

    “When drafted so broadly, these expectations incentivise proactive monitoring and removal of content that falls under Class 1 or 2. Given the immense scale of online content, tech companies generally turn to automated processes to determine which content is or isn’t harmful, despite evidence that content moderation algorithms are not consistent in identifying content correctly,” Digital Rights Watch said.

    Digital Rights Watch has called for amendments to the legislation, including for the introduction of a sunset clause so the powers are reviewed before they are renewed, a multistakeholder oversight board to review takedown decisions, better transparency over the categories of takedowns and complaints, and a meaningful appeals process.

    The legislation will establish a “world-first cyberabuse take-down scheme” for Australian adults, communications minister Paul Fletcher said in Parliament last month.

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  • The new Online Safety Bill has been a ‘rush job’

    Civil and digital rights groups say the sweeping new Online Safety Bill is a “rush job”, having been introduced to federal parliament just 10 days after government received nearly 400 submissions on the proposed laws.

    The government unveiled the draft Online Safety Bill in December last year, with consultation running across the summer break up until 14 February.

    The bill extends the eSafety Commissioner’s takedown scheme for Australian adults, allowing them to issue removal notices for content deemed to be rated as R18+ or higher, and to order the sites or apps be blocked if they do not comply.

    Data
    Dark tunnel: The Online Safety Bill has been smashed through parliament

    There are significant concerns about the new powers, particularly their impact on sex workers and activists, the significant power and discretion handed to the commissioner, and on their potential to further undermine encryption.

    Despite the scale and scope of the legislation, the process behind its introduction to parliament and consultations has been a “rush job”, Digital Rights Watch program director Lucie Krahulcova said.

    Submissions on the draft legislation closed on 14 February, with 370 submissions made to government on the bill.

    Despite the volume of submissions, the government introduced the legislation to Parliament just 10 days later on 24 February. It is still yet to release any of the submissions it received as part of that round of consultation.

    It was subsequently referred to a Senate committee for inquiry, with submissions opening on 25 February and closing on 2 March. This left just three working days for stakeholders to make a further submission on the final legislation.

    “The fact that the government is willing to plough on with the bill a mere 10 days after 370 submissions were filed should raise alarm bells. That is not what a democratic consultation process looks like,” Ms Krahulcova told InnovationAus.

    “This does not indicate a meaningful consultation process, nor that community concerns are being taken seriously. It means we need to speak up even more,” Digital Rights Watch tweeted.

    Former federal Greens Senator Scott Ludlam also raised concerns with the timeframe around the bill in a submission to the senate inquiry, saying it appears the government has already made up its mind.

    “As expected, the draft bill provoked hundreds of submissions flagging grave concerns. For some reason the government has ignored this feedback and instead proposes to proceed with an unacceptably compressed timetable, with a largely unamended bill, in the absence of any formal response to red flags many civil society organisations have made,” Mr Ludlam said in the submission.

    “This response indicates that the government had already made up its mind, calling into question the purpose of the exposure draft. It therefore falls to the senate, through this committee, to prevent the foreseeable risks posed by this bill as drafted.”

    In its submission, tech giant Google also pointed out the speedy process of introducing the bill to Parliament.

    “This bill was introduced into the House of Representatives a mere 10 days after the public consultation period on the Exposure Draft of the bill closed,” Google’s Samantha Yorke said in the submission.

    The Online Safety Bill will introduce a “world-first cyber abuse take-down scheme” for Australians, Communications Minister Paul Fletcher said in Parliament last month.

    “This new scheme provides a pathway for those experiencing the most seriously harmful online abuse to have this material removed from the internet,” Mr Fletcher said.

    “The Australian government believes the digital industry must step up and do more to keep their users safe. That belief underpins the provisions of the bill.

    “We all enjoy standards of behaviour and civility in the town square that keeps us safe, and there are appropriate mechanisms and sanctions for those who break these rules,” he said.

    “The Australian government believes that the digital town squares should also be a safe place, and that there should be consequences for those who use the internet to cause others harm. This bill contains a comprehensive set of measures designed in accordance with this belief.”

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  • Digital platform to modernise RDTI delivery

    A new platform to modernise the delivery of the research and development tax incentive will be launched to coincide with the introduction of a range of reforms to the popular scheme.

    The registration form and online portal for companies accessing the research and development tax incentive (RDTI), built by large consultancy Deloitte, will go live in the second half of the year, with a number of changes to the scheme coming into effect from July.

    In July last year Deloitte was awarded a $1.1 million contract over six months for “services to support research and development tax incentive ICT reform projects” from the industry department.

    money currency
    Tax Incentive: A new platform that is supposed to make R&D tax incentives easier

    This work involved program management, change management, data migration and business support services to the new RDTI portal, with the work finishing at the end of last year.

    The platform stems from the 2018-19 budget which included a number of reforms to the RDTI, most of which have since been abandoned by the Coalition. That budget included extra funding for the industry department for RDTI program integrity and administration.

    The new RDTI platform will aim to modernise the process of accessing the program for Australian companies, improving the tech behind it and the customer-facing forms.

    It will allow companies to manage registrations for the RDTI and advance and overseas finding applications. The platform will also include the government’s digital identity offering myGovID, and a more up-to-date process.

    Through the portal, companies will also be able to submit requests for extensions of time and will be able to withdraw or vary their applications.

    The platform will display the status of applications for the RDTI in real time, and indicate when deadlines for submissions are upcoming.

    Through the one-stop portal, the department is aiming to improve the user experience of accessing the RDTI, which is currently done through a form on business.gov.au.

    The platform will be launched in the second half of the year.

    Late last year the Coalition passed its “enhancements” to the RDTi through Parliament, after backing away from its plan to cut $1.8 billion through the scheme.

    The changes, coming into effect in July, will see companies with annual turnover under $20 million receiving a refundable tax offset for R&D set at 18.5 percentage points above the claimant’s company tax rate.

    Companies with higher annual turnover will have their offset determined by a new intensity measure, calculated by dividing the level of R&D conducted by a company by its total expenses.

    Companies with an intensity measure of 0-2 per cent will receive an offset of 8.5 percent above its company tax rate, while a higher score will deliver a 16.5 percent offset.

    The expenditure threshold will also be increased from $100 million to $150 million from the next financial year, with a number of administrative changes to also be introduced to the scheme.

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  • DTA deal with SAP has grown to $315m

    The Digital Transformation Agency has renewed its whole-of-government deal with German tech giant SAP, which is now worth $315 million.

    Last week the Digital Transformation Agency (DTA) confirmed it would extend its arrangement with German software giant SAP – first signed in 2017 – for a further 12 months, meaning it will run until at least September 2022.

    The DTA said it would hold a roundtable on the deal to discuss “potential improvements and options for negotiations” this month.

    Canberra Parliament
    Big Ticket: German supplier SAP gets another jersey from the Commonweath Credit: Linda_K/Shutterstock.com

    “The decision to take advantage of the extension option was based on direct feedback from agencies, who told us that the whole-of-government agreement makes the process of sourcing SAP products simpler and faster,” the DTA said.

    “Agencies were also concerned that not extending the whole-of-government agreement would result in insufficient time to put alternative arrangements in place prior to September 2021.”

    The SAP deal covers its software and support services, cloud services and digital business services.

    An updated tender posted publicly this week revealed that this deal with SAP is now worth nearly $315 million over five years, after it was initially valued at just $42 million when first signed in September 2017.

    The contract has since seen nine value increases in the last four years to take it to its current worth.

    The DTA has also inked deals with SAP outside of the whole-of-government contract for subscriptions for various government agencies. In the 2020 calendar year, the DTA’s contracts with SAP in addition to the whole of government arrangement totalling a further $37.65 million.

    The federal government also has a whole-of-government purchasing agreement with expense management company Concur, wholly-owned by SAP, meaning the German multinational now effectively has two purchasing agreements with the Commonwealth.

    There are seven whole-of-government purchasing agreements in total, and none are with any Australian companies.

    The deals make it easier for government customers to purchase from these global tech companies.

    Other companies with purchasing agreements with the government include Oracle, AWS, IBM, Microsoft and Rimini Street.

    The most recent deal was with Oracle and was signed in December last year.

    In July last year the New South Wales government signed a whole-of-government purchasing agreement with local firm Vault Cloud, the first of its kind with an Australian company by any government in the country.

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  • Boeing’s first test for Loyal Wingman drone

    Boeing Australia and the Royal Australian Air Force have announced a successfully completed first test flight for the Boeing Loyal Wingman autonomous plane, the first military aircraft to be designed and manufactured in Australia in over half a century.

    The plane flew under the supervision of a Boeing test pilot in a ground station at Woomera Range Complex in South Australia.

    Cath Roberts of the RAAF called the milestone a major step forward in a major program, and a pathfinder for creating smart human-machine teams by integrating autonomous systems with artificial intelligence.

    Boeing Loyal Wingman
    First test: Boeing’s Australian designed and built drone Loyal Wingman had its first test flight

    “Through this project we are learning how to integrate these new capabilities to complement and extend air combat and other missions,” said Roberts.

    The Loyal Wingman is an 11.7-metre aircraft being developed by Boeing Defence Australia and the Royal Australian Air Force, with a team of over 35 Australian participants, including BAE, Ferra Engineering and RUAG Australia.

    It is the first military aircraft to be developed and built locally in more than 50 years, and will fly in company with manned aircraft, such as the F-35 Joint Strike Fighter, “using artificial intelligence to team with existing crewed and uncrewed assets to complement mission capabilities,” said Boeing in a statement.

    “This first Loyal Wingman aircraft is serving as the foundation for the Boeing Airpower Teaming System being developed for various global defence customers.”

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  • Troubled ACS is now a $50m revenue charity

    The internally troubled Australian Computer Society has lodged its annual numbers with the charity’s regulator – a month late – clocking revenue of nearly $50 million for the 2020 financial year, a period disrupted by bitter internal brawling and the impact of the pandemic.

    Revenue for the period grew by $4.61 million to $49.8 million, but the surplus for the period fell by more than $1 million. This is despite significantly reduced expenses for travel and accommodation, events and meetings, and marketing, PR and publications, which were curtailed by a combination of the internal turmoil of the reporting period and the pandemic.

    Despite the ACS’s reduced activity, staff costs grew by 17 per cent during the period from $21.6 million to $25.2 million for the 2020 financial year. The cost of Key Management Personnel grew by more than 25 per cent from $2 million in 2019 to $2.6 million in 2020, although it is unclear where this additional expense was applied.

    Barangaroo
    ACS headquarters – Big floorplate, big cost. Photo: Holli/Shutterstock.com

    Employee expenses climbed to more than 50 per cent of revenue at the ACS. The number of full-time equivalent employees grew from 100 reported in 2019 to 128 in 2020.

    The employee benefit expense per full-time employee in 2020 was about $196,000, a substantial premium compared to the comparable professional associations.

    The ACS financial report to the Australian Charities and Not-for-profit Commission (ACNC) confirmed that an independent audit firm had performed a review of the processes around expense and contract management, as well as a forensic review into specific expenses. The society’s National Congress had voted to conduct the audit at a special meeting last October.

    The management committee gave few details of the review beyond “there were no instances of fraud identified, however recommendations for improvement of policies & procedures were made and taken onboard by management.”

    The management committee also reported that the ACS had received an Improvement Notice from SafeWork NSW, which is understood to be related to staff allegations of bullying in the workplace and said “this notice is being addressed by ACS Management.”

    The ACS controversially acquired several other industry associations in September 2019, including the Association for data-driven Marketing and Advertising (ADMA), the Institute of Analytics Professionals of Australia (IAPA), Data Governance Australia, and Digital + Technology Collective (DT&C).

    The acquisitions sparked protests among sections of the ACS membership that ultimately led to the two years of infighting at the association.

    The consolidated acquisition costs of these industry associations – the net outflow of cash to acquire the businesses – at $2.6 million. These acquired businesses contributed a loss of $1,008,508 to the ACS numbers for the past financial year.

    The ACS financials for the 2020 financial year will likely raise questions among those National Congress members who passed a vote of ‘no confidence’ in the ACS Management Committee in October last year.

    In addition to the fast-growing employee benefits expenses, the sharply increased cost of the ACS’ office accommodation. The society has a long-term lease at International Towers at Barangaroo in Sydney, one of the most expensive commercial addresses in Australia.

    The latest financials treat its office leases as a “right to use” asset of $34.7 million, placing a depreciation charge for this ‘asset’ $4.09 million (effectively the rental outgoing for the 2020 financial year).

    Total undiscounted lease liabilities held by the ACS at the end of June 2020 was $36.5 million.

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  • BCG gets $11.5m for Vic digital contact tracing

    Boston Consulting Group was paid more than $11 million over three months to digitise the Victorian government’s paper-based COVID-19 contact tracing system late last year and implement Salesforce’s customer relations management platform.

    Boston Consulting Group (BCG), which also worked on the federal government’s COVIDSafe contact tracing app, was awarded the contract by the Victorian government at the end of October last year, replacing its rival Deloitte in the role.

    Deloitte had already been paid nearly $5 million over two and a half months to start the implementation project that quickly experienced “complications and challenges”.

    melbourne
    Contact tracing: Big payday for Boston Consulting Group and Salesforce

    Tender documents recently posted reveal the full financial and contract details of the implementation of a Salesforce CRM platform to digitise Victoria’s COVID-19 contact tracing system, replacing the existing Public Health Event Surveillance System (PHESS), which was mostly based on pen and paper and reliant on fax machines.

    In total, the state paid more than $20 million for the new digital contact tracing system, with the bulk of the money going towards large consultancy firms BCG and Deloitte, along with Salesforce and Contino.

    Under the contract for the “second phase” of the project, BCG played a lead role, and only subcontracting work to Salesforce and UK tech consultancy Contino.

    Work had already begun to implement Salesforce’s platform in August, with Deloitte awarded a contract for “implementation, enhancement and support” of the Digital Trace, Test and Isolate platform.

    But after initial “complications and challenges”, Deloitte was replaced in the role by BCG, which was awarded a two-month contract that was extended for a further month to make it run up until 23 January this year.

    Deloitte’s contract, worth $4,935,500, came to an end on 7 November, two weeks after BCG was brought in to fix the implementation.

    There may have been some hitches in the second phase too though, with Contino recently awarded a $175,00, three-week contract for “support to clear defect backlog” on the same system.

    The 30-page contract between the Victorian government and BCG details how the large consultancy will deliver implementation services, development services and professional services on the contact tracing app.

    BCG was quickly provided with handover documents from Deloitte on the work completed on the system already.

    The new digital platform is centred on COVID-19 case, contact and outbreak management and was designed to help the state government reach its goal of 90 percent of active confirmed cases being completed within 48 hours.

    It details how the new contract was designed to overcome the “complications and challenges of the first phase”, which was tendered to Deloitte. This was done through changing the delivery accountabilities to the BCG consortium of Salesforce and Contino, with clearer accountabilities and a streamlined decision-making process.

    BCG provided a lead role and filled a “critical subject matter expert resources gap”, with Salesforce handed more responsibility this time around and Contino providing additional resources.

    The contract required the consortium to focus on off-the-shelf functionality by default rather than custom builds, with the work to be completed “as quickly as possible”.

    Within four weeks, BCG was required to deliver 49 full and partial features, build the data integration and reporting features and began work on critical path data migration and reporting.

    While BCG’s contract has now ended, Contino was awarded a further contract worth nearly $3.8 million from early January to the end of June for “ongoing support and development” on the contact tracing platform.

    The UK-based consultancy was also recently awarded another contract for “support to clear defect backlog” on the platform, running for just three weeks to early March and worth $175,000.

    On top of its subcontractor role, Salesforce was paid $1.8 million by the state for software licences for its contact tracing CRM platform. On the same day, Mulesoft was awarded $431,000 for a one-year deal to provide software for the new system.

    The Victorian government has now paid more than $20 million for the design and implementation of its new digital contract tracing platform over the last six months.

    BCG also played a prominent role in the development of COVIDSafe, with the firm paid $1 million for work on the controversial contact tracing app.

    Salesforce first pitched its digital solution to the state government in March last year, but Victoria did not opt to implement it until August, five months later. This delay was criticised by a parliamentary inquiry into Victoria’s contact tracing system.

    “However capable the current contact tracing solution is, it was not available when the Victorian public needed it. This failure cost lives and was unable to be rectified without strict lockdown measures throughout the state,” the committee’s report said.

    “The committee views the reluctance by the Victorian government to concede or acknowledge errors as a contributing factor in the substantial delays in the implementation of a suitable contact tracing management system.

    “Furthermore, the committee notes that this lack of humility has the capacity to hinder progress by limiting opportunities for collaboration or building off developments made in other jurisdictions.”

    The Victorian government told the inquiry it did not go with the Salesforce option initially as it would be a “major project requiring significant resourcing”.

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  • Retained Economic Benefit is the next new thing

    Spending by Australian governments on information technology is expected to exceed $13 billion this year, according to global research outfit Gartner. That’s an extraordinary amount of money and a massive opportunity for developing the local tech industry.

    Unfortunately, outside of the Defence sector, Australia has a dismal track record in devising procurement frameworks that encourage the development of sovereign capability and capacity. This is a great shame, and a wasted opportunity (to say nothing of the taxpayer dollars involved).

    Other governments around the world routinely attach industrial development requirements to public spending. It is a powerful lever that governments use to boost domestic capability.

    city suburb
    Where’s the beef?: Procurement policy most consider Retained Economic Benefit measure

    The United States government, for example, is a pacesetter in this regard. The US has always used the massive purchasing power of its government to drive industrial outcomes. Because why wouldn’t you?

    President Joe Biden has taken Donald Trump’s America First rhetoric and institutionalised it through his January Made in America Executive Order – one of his first acts as President. This Biden executive order makes Donald Trumps America First program look like the little league.

    The executive order is all about the preferential treatment of American suppliers and American technology in government procurement. It creates a Made in America Office within the US’ powerful Office of Management and Budget.

    The executive order is openly aimed at helping American businesses compete in strategic industries and helping American workers to thrive. Any agency planning to make a procurement purchase outside of this buy American edict must apply to the Made in America Office for a waiver.

    This is unabashedly about applying US procurement dollars to US strategic interests. In America, this is a non-controversial issue.

    In Australia, however, our government is less plugged into industrial policy. It is less interested in using its procurement spending as an instrument of industrial development. It is bizarre.

    Federal Defence spending is routinely attached to sovereign capability development. As a matter of security, there are many, many areas where it is considered imperative that Australia have its own domestic capability. Hooray for common sense.

    But surely Defence cannot do all of the heavy lifting in this regard? And surely capability development in information technology and telecommunications are areas of core strategic interest?

    Cybersecurity, artificial intelligence, software development, digital delivery, data centre construction and management, cloud service delivery: Are these not areas where it is critical that Australia maintain a sovereign capability?

    And what about quantum technologies? Australian governments have invested quite heavily in its development, but on past performance our governments would be unlikely to buy an Australian-developed quantum product because it is all too hard.

    How are these things not fundamentally a part of Australia’s thinking when it comes to government procurement policy?

    Scott Morrison’s uninspiring “We’ve just got to be the best at adopting it” speech last October in relation to tech entirely misses the strategic importance of sovereign tech capability. This thinking from a national leader in the 21st century is baffling.

    It is time for a reform of technology procurement in this country. The difficulties that Australian tech companies have in selling to government is both cultural and structural. But in an era of geo-strategic uncertainty, this must surely change.

    Which brings us to the notion of Retained Economic Benefit, a term that Australian companies are starting to use in relation to procurement policy.

    Retained Economic Benefit refers to a consideration that should be written into Commonwealth procurement rules that applies a positive weighting to where the benefits of a purchasing decision will land (beyond the actual dollars).

    The retained economic benefit of a purchasing decision would include the spill-overs and multipliers that come from income earned through a government contract. Are the jobs that the contract will support created in Australia or elsewhere? Will any intellectual property created through the contract be owned by an Australian company and will it contribute to the nation’s sovereign capability?

    What is the effective historical tax rate of one company compared to the tax rate of another? How much will the contract add to a company’s valuation, and what are the multiplier benefits that will be created by that increased valuation.

    The addition of a Retained Economic Benefit measure is a modest request from Australia’s domestic suppliers. The Commonwealth Procurement Rules already contain quite broad ‘value-for-money’ to which a Retained Economic Benefit weighting could be easily added.

    The Retained Economic Benefit concept has been discussed within the NSW ICT Procurement Taskforce. It is understood to be in active discussion within the Australian Information Industry Association.

    For what seems like a no-brainer, there is already pushback against the proposal.

    Incredibly, the NSW government taskforce was understood to have been advised by the Department of Foreign Affairs and Trade that a requirement for a Retained Economic Benefit required would breach the Australia-US free trade agreement.

    This is absurd and lazy.

    Someone should tell DFAT about Joe Biden’s Made in America executive order LOL.

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  • Aussie space startups to launch bushfire satellite

    Three Australian space companies will unite to launch a bushfire detection satellite into orbit in a major milestone for building sovereignty capability in the local space sector.

    In-space transportation provider Space Machines Company has signed a deal with Fireball.International to launch a bushfire detection satellite into final orbit next year. The South Australian startup last year announced a launch agreement with Gilmour Space Technologies to send its orbital transport Optimus-1 into space in 2021.

    This rocket will now carry the fire detection satellite, which will provide automated bushfire detection and tracking.

    Space machines
    Space taxi: Australians delivering Australians in space

    Fireball.International can detect a bushfire within minutes by analysing images from satellites and sensors in real-time, and sends notifications and maps to emergency responders when it does detect a fire.

    A report by the Australian National University last year found that the detection of bushfires within 30 minutes could lead to a total benefit of $8.2 billion.

    The announcement is a significant development for the local space sector and a demonstration of what’s possible for Australian companies, Fireball.International chief executive Christopher Tylor said.

    “This is an Australian-built taxi, which will bring an Australian-built satellite which looks for fires and has national interest, which is launched by an Australian-built rocket and from an Australian spaceport in Queensland. This story is amazing,” Mr Tylor told InnovationAus.

    The federal government has been urged to pursue greater sovereign capability in space, and this is a key aim of the Australian Space Agency.

    The launch next year will showcase the potential of the local sector, Space Machines Company chief executive Rajat Kulshrestha said.

    “It’s a pretty big milestone. The ability for us to have a satellite which addresses a key national interest issue, going on top of a space transportation platform, on top of an Australian-built and launched rocket shows our space industry to a global market,” Mr Kulshrestha told InnovationAus.

    “Success will mean that some of the targets the government has for growing this industry are well on their way. All this capability will eventually help support Australian companies for years to come.”

    In September last year Space Machines Company inked the deal with Gilmour to become a customer on its first Eris rocket launch next year, with the startup to launch a 35kg spacecraft to orbit. This will be the largest payload sent into orbit by an Australian company to date.

    Having local launch companies and space taxis allows for the specific deployment and positioning of satellites at a cheaper price, Mr Tylor said.

    “With this technology we can be delivered into orbit where we want to be, and where we need to be. The problem with launching something there is it is very expensive,” he said.

    “With the technology Space Machines Company can offer us, the price of launching a satellite comes down. That is a big advantage”

    Fireball.International currently relies on Japanese satellites launched by the Japan Space Agency to monitor bushfires in Australia.

    The ability to launch satellites locally will be pivotal for the development of the Australian space sector, Mr Kulshrestha said.

    “The ability for Australia to have responsiveness to put satellites into exactly the right place and especially satellite capabilities of national interest, is a key part of the sovereign capability we need to develop,” he said.

    A government inquiry into the development of the space sector has heard concerns that the federal government’s plans to charge companies to apply for a launch permit will jeopardise the growth of the sector, which is hoping to launch up to 2500 satellites in the next five years.

    Late last year independent senator Rex Patrick said the space sector is at risk of “shutting down before it starts”, with no launch permits issued yet.

    But Mr Tylor said the agency is still young, and the local industry needs to work with it to overcome initial issues.

    “What the Australian Space Agency here has achieved in this short period of time is amazing. It’s young and we have to work with them and they are very open and helpful if you approach them,” he said.

    “Support is needed to help the companies there to develop and produce products which are competing in an international market. Our fire satellites are an example of that. It may only cover Australia for now but when we have a full constellation we will cover the whole planet.”

    Mr Kulshrestha said the company has been working directly with the space agency to iron out issues in applying for permits.

    “There are a lot of problems to solve. Our approach has been to collaboratively work together with government and the agency to get the outcomes that Australia needs,” he said.

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  • Govt backs off proposed Big Tech inquiry

    A Liberal Senator has withdrawn his attempt to launch a parliamentary inquiry into the influence of Big Tech in Australia on the same day the federal government passed its controversial media bargaining code into law and Facebook reversed its news ban.

    Liberal Senator Alex Antic had planned to move a motion in the Senate on Wednesday afternoon to establish a Select Committee on Big Tech Influence in Australia, but withdrew this motion at the last minute.

    This was the same day that Treasurer Josh Frydenberg reached an agreement with Facebook to amend the news media bargaining code legislation to ensure the tech giant allowed news content back onto its platform.

    Canberra Parliament
    Re-think: The Senate inquiry into Big Tech influence no longer so interesting

    Last week Facebook went nuclear and followed through with its threat to block all news content for Australian users in response to the bargaining code, which would force it to enter into final offer arbitration to determine revenue sharing deals with media companies.

    Senator Antic used the move as further evidence that the Big Tech inquiry was needed.

    “The news today that Facebook are banning access to news publishers, TV stations and government departments highlights why I have been calling for a Senate Select Committee to be established to investigate the activity and behaviour of Big Tech,” Senator Antic posted on Facebook last week.

    But Senator Antic eventually withdrew his plan to move the motion in the Senate, just hours after the government brokered a deal with Facebook.

    Shadow industry and innovation minister Ed Husic labelled the attempted motion a “joke”.

    “On so many levels this was a joke and a poor one at that. There are countless reports gathering dust now on what needs to be done to combat some of the excesses in technology, that this government has ignored,” Mr Husic told InnovationAus.

    “On top of that did anyone seriously think that this government that had pulled the handbrake on implementing Royal Commission recommendations against big banks was serious about a Big Tech inquiry that would produce a report that would go nowhere.”

    The timing of the motion was telling, Mr Husic said.

    “It was cute timing to think a bunch of nobody senators proposing an inquiry into Big Tech would scare Facebook into a different position on the code,” he said.

    “Again, I think there are serious issues that need to be dealt with and we do need to work with tech on them, from privacy to competition law, but this was just a brain snap, a political parlor game that was never destined to go anywhere.”

    The inquiry would have looked into the management of disinformation, misinformation and malinformation, including shadow banning, de-platforming and demonetisation. Just this week the tech giants unveiled their voluntary code of conduct around misinformation and disinformation which was widely panned.

    There is also an existing Select Committee focusing on foreign interference through social media, which is expected to table its final report in May next year.

    The committee would have been tasked with investigating the prevalence of fake accounts and bots on platforms such as Facebook, along with these companies’ privacy settings and the use of data by third parties.

    The Senators would also be tasked at looking at whether these firms are complying with Australian laws. The committee is expected to table its final report in December next year.

    It came on the same day that the federal government passed its legislation launching the media bargaining code through Parliament. The code will force designated companies to eventually enter into forced arbitration to determine revenue sharing deals with media companies over the sharing of news content.

    The code was a key recommendation from the Australian Competition and Consumer Commission’s (ACCC) digital platforms inquiry, which also included a number of other policy recommendations for government.

    The ACCC has also launched a series of legal actions against Big Tech firms for a range of alleged offences.

    The Attorney’s-General Department is also conducting a review of the Privacy Act which will likely call on the tech giants to improve security and data handling practices, and give room for individuals to launch legal action against the firms for breaches of privacy.

    The Coalition has also been highly critical of tech firms offering encrypted communications, including Facebook,and moved a number of pieces of legislation aimed at undermining this.

    Laws introduced to Parliament late last year would hand sweeping new powers to the AFP to access and “disrupt” the networks of those suspected of crimes, and to even take over their accounts on Big Tech platforms covertly.

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  • Govt backs off proposed Big Tech inquiry

    A Liberal Senator has withdrawn his attempt to launch a parliamentary inquiry into the influence of Big Tech in Australia on the same day the federal government passed its controversial media bargaining code into law and Facebook reversed its news ban.

    Liberal Senator Alex Antic had planned to move a motion in the Senate on Wednesday afternoon to establish a Select Committee on Big Tech Influence in Australia, but withdrew this motion at the last minute.

    This was the same day that Treasurer Josh Frydenberg reached an agreement with Facebook to amend the news media bargaining code legislation to ensure the tech giant allowed news content back onto its platform.

    Canberra Parliament
    Re-think: The Senate inquiry into Big Tech influence no longer so interesting

    Last week Facebook went nuclear and followed through with its threat to block all news content for Australian users in response to the bargaining code, which would force it to enter into final offer arbitration to determine revenue sharing deals with media companies.

    Senator Antic used the move as further evidence that the Big Tech inquiry was needed.

    “The news today that Facebook are banning access to news publishers, TV stations and government departments highlights why I have been calling for a Senate Select Committee to be established to investigate the activity and behaviour of Big Tech,” Senator Antic posted on Facebook last week.

    But Senator Antic eventually withdrew his plan to move the motion in the Senate, just hours after the government brokered a deal with Facebook.

    Shadow industry and innovation minister Ed Husic labelled the attempted motion a “joke”.

    “On so many levels this was a joke and a poor one at that. There are countless reports gathering dust now on what needs to be done to combat some of the excesses in technology, that this government has ignored,” Mr Husic told InnovationAus.

    “On top of that did anyone seriously think that this government that had pulled the handbrake on implementing Royal Commission recommendations against big banks was serious about a Big Tech inquiry that would produce a report that would go nowhere.”

    The timing of the motion was telling, Mr Husic said.

    “It was cute timing to think a bunch of nobody senators proposing an inquiry into Big Tech would scare Facebook into a different position on the code,” he said.

    “Again, I think there are serious issues that need to be dealt with and we do need to work with tech on them, from privacy to competition law, but this was just a brain snap, a political parlor game that was never destined to go anywhere.”

    The inquiry would have looked into the management of disinformation, misinformation and malinformation, including shadow banning, de-platforming and demonetisation. Just this week the tech giants unveiled their voluntary code of conduct around misinformation and disinformation which was widely panned.

    There is also an existing Select Committee focusing on foreign interference through social media, which is expected to table its final report in May next year.

    The committee would have been tasked with investigating the prevalence of fake accounts and bots on platforms such as Facebook, along with these companies’ privacy settings and the use of data by third parties.

    The Senators would also be tasked at looking at whether these firms are complying with Australian laws. The committee is expected to table its final report in December next year.

    It came on the same day that the federal government passed its legislation launching the media bargaining code through Parliament. The code will force designated companies to eventually enter into forced arbitration to determine revenue sharing deals with media companies over the sharing of news content.

    The code was a key recommendation from the Australian Competition and Consumer Commission’s (ACCC) digital platforms inquiry, which also included a number of other policy recommendations for government.

    The ACCC has also launched a series of legal actions against Big Tech firms for a range of alleged offences.

    The Attorney’s-General Department is also conducting a review of the Privacy Act which will likely call on the tech giants to improve security and data handling practices, and give room for individuals to launch legal action against the firms for breaches of privacy.

    The Coalition has also been highly critical of tech firms offering encrypted communications, including Facebook,and moved a number of pieces of legislation aimed at undermining this.

    Laws introduced to Parliament late last year would hand sweeping new powers to the AFP to access and “disrupt” the networks of those suspected of crimes, and to even take over their accounts on Big Tech platforms covertly.

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  • Govt must help business tackle ransomware

    Maksim Yakubets cuts quite the figure driving his custom fluoro camouflage Lamborghini through the streets of Moscow.

    According to indictments filed in the United States, Yakubet could live this lifestyle thanks to his role in the international ransomware gang, ‘Evil Corp’, which is estimated to have extorted about US$100m ($128m) from businesses and individuals around the world.

    The United States sanctions payments of ransoms to Evil Corp, but there is no equivalent restriction in Australia.

    In fact, despite ransomware being described by the Australian Cyber Security Centre as the biggest cyber threat facing Australia, there’s no dedicated government strategy for tackling this rapidly growing crime that brings in big bucks for international criminals at the expense of Australian businesses and consumers.

    Ransom guy: Evil Corp’s Maksim Yakubets on the streets of Moscow Photo credit: UK National Crime Agency

    Australia has recently seen high impact ransomware campaigns against high profile targets like Toll Group, Bluescope Steel, Lion, Spotless, Regis Healthcare, Law in Order, and regional Victorian hospitals.

    The Australian government does not currently collect statistics about the impact of ransomware, but analysis by security firm Emsisoft in 2020 estimated its total annual cost to the nation at a minimum of US$270 million (AU$348 million) and a best estimate of US$1.1 billion (AU$1.4 billion).

    The rapidly growing costs of successful attacks on targeted entities – in downtime, remediation, ransoms and supply chain interruptions – combined with the growing costs to all organisations of defending themselves against these attacks is an unsustainable burden on the nation.

    Ransomware is a jobs and investment destroyer at a time when the nation can least afford it.

    While individual organisations will always have the primary responsibility for taking the necessary steps to protect their IT systems from cyber threats, too often, blaming the victim becomes a cover for government inaction.

    It is past time that the Morrison government developed a dedicated National Ransomware Strategy that actively sought to reduce the number of ransomware attacks targeting Australia.

    The evolution of ransomware gangs into sophisticated, well-resourced organised crime groups presents both a challenge and an opportunity.

    The emergence of so called ‘big game hunting’ ransomware gangs that carefully research and select their targets to maximise the returns of attacks has increased the costs of ransomware.

    But this sophistication has also created the opportunity for new government strategies aimed at deterring these attacks.

    We know from interviews with these gang members and from the advertisements they post seeking affiliates that these gangs are aware of the differences in security practices, regulations and law enforcement practices in different nations. We can use this to our advantage as a nation.

    A National Ransomware Strategy that sought to increase the costs and reduce the returns of ransomware campaigns against Australian organisations, could send a message to ransomware gangs that Australian targets aren’t worth the effort.

    As the United States has done with Evil Corp and Mr Yakubets, one of the policy levers government could use as part of such a strategy is regulating the payment of ransoms.

    Ransom payments are the life blood or ransomware campaigns. More payments beget more attacks. On the other hand, if Australia became known as a jurisdiction where it was hard to get paid, ransomware gangs may choose to select targets elsewhere.

    In recent months, the former Directors of both the US Cybersecurity and Infrastructure Security Agency and the UK National Cyber Security Centre, have each called for the serious consideration of banning ransom payments in their respective countries.

    Australia should have this debate too as part of a broader discussion about the potential tools available to government to convince ransomware gangs that there’s no return on investment from targeting Australian organisations.

    Labor has released a discussion paper that canvases a range of tools government could employ as part of a National Ransomware Strategy to shape the target selection of ransomware gangs and ultimately to reduce the number of attacks targeting Australian organisations.

    None of the potential interventions identified in Labor’s discussion paper are silver bullets. But the threat of ransomware isn’t going anywhere soon and the government cannot leave it to Australian organisations to confront this challenge alone.

    It is time the Morrison Government took this threat seriously and developed a National Ransomware Strategy.

    Tim Watts is Labor’s Shadow Assistant Minister for Cyber Security and the federal Member for Gellibrand.

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  • Manufacturing fund opens for medical products

    The federal government’s $1.3 billion modern manufacturing fund is now open for medical products, with a focus on research translation and sovereignty.

    The Modern Manufacturing Initiative is the centrepiece of the government’s $1.5 billion Modern Manufacturing Strategy, a key plank of the Coalition’s economic recovery plan from the COVID-19 pandemic.

    It is targeted as six manufacturing priority areas: space, medical products, resources technology and critical minerals processing, food and beverage, recycling and clean energy and defence.

    MedTech
    MedTech: Australia’s Modern Manufacturing initiative is now open to MedTecch

    Last week Industry Minister Karen Andrews officially opened the fund, with the space sector the first able to apply.

    The $1.3 billion Modern Manufacturing Initiative is now open for applications from the medical products sector, with the government also unveiling a roadmap for the sector.

    Companies can now apply for the fund’s translation and integration streams, with applications for the larger collaboration stream to open in the coming months.

    “This support will help us make more medical products right here at home – creating more skilled jobs for Australians and helping build a resilient and competitive manufacturing base at the heart of our economy,” Ms Andrews said.

    “Through the Modern Manufacturing Initiative, we’re supporting more manufacturers to turn their clever ideas and research into commercial outcomes, and harness global opportunities.”

    The specific areas of interest for the government, as outlined in the roadmap, include smart monitoring devices and diagnostics, personalised implants and bionics, high-value pharmaceuticals, biologics and complementary medicines, mRNA vaccines, genomics and digital integrated products and platforms.

    The roadmap will be used to guide government and industry investment in the medical products space, Ms Andrews said.

    “This dynamic, industry-led roadmap sets out the vision for the sector with a focus on high-value opportunities that will position medical products manufacturers for long-term growth,” she said.

    “Australia’s response to the COVID-19 pandemic showed the remarkable capability and expertise that already exists within our medical products manufacturing sector, as well as our potential for future success. The Modern Manufacturing Initiative is focused on scaling-up that capability – both to create economic opportunity and to ensure the supply of critical products during times of crisis.”

    Funding rounds and roadmaps for the remaining four areas of manufacturing priority are expected to be opened in the coming weeks.

    The six areas of focus closely mirror the priorities of the government’s Industry Growth Centres program, which is funded until next year.

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  • Manufacturing is a capability, not a sector

    The assertion by The Australian newspaper for it to be ‘too late to save manufacturing’ is grounded in a lack of understanding. First, in what is manufacturing. Second, in how it is measured, and third in how it has evolved.

    Manufacturing is not a sector. It is a capability. Manufacturing cuts across other sectors, and is often confused with production. However, manufacturing involves seven steps along its manufacturing value chain: Research and Development (R&D), design, logistics, production, distribution, sales and services.

    The six most valuable steps of the value chain take place before and after production and they contribute to the creation of highly-skilled, highly paid, resilient and diverse jobs. They are difficult to measure and are not part of the Australian Bureau of Statistics (ABS) calculation towards manufacturing employment.

    Manufacturing
    Jens Goennemann: ‘Manufacturing is a capability not a sector’

    By recognising the broad, and the most relevant for Australia, value chain, our manufacturing industry employs about 10 per cent of the local workforce. This represents over 1.2 million people as opposed to the often-quoted and frankly outdated ABS figure of ~850,000 (or 7 per cent). In short, the assertion of Australia’s manufacturing industry’s size and its decline is plain wrong.

    By continuously talking down our manufacturing industry without understanding it properly, means that our country will miss a significant opportunity to continue to grow a resilient, globally competitive, and vibrant onshore capability which will be the single most promising capability to transform the lucky country into a smart one.

    Manufacturing in Australia is about being better not cheaper, seeking to add value, and allowing our highly innovative and skilled manufacturers to scale, taking their products global.

    We should not fall into the trap of thinking we must make everything onshore; we should concentrate on areas where we do very well and do more of that. Far from picking winners, this strategy is about boosting competitiveness in areas in which we have already won and then taking them to the world.

    One manufacturing opportunity would be to take our abundant natural resources and move from ‘digging and shipping’ to ‘adding value’. This transformation is already underway with companies such as Energy Renaissance forging a new sovereign capability in Lithium-Ion battery manufacturing, with a view to serve 7.5 billion global customers, not just 25 million local ones.

    Energy Renaissance is addressing a global market which has signalled a move away from fossil fuels. It is here where Australia is in a prime position to lead the charge with renewable and green energy. Rather than lament the closure of an oil refinery, let us look at the opportunity to lead in the next big thing – renewables, underpinned by hydrogen.

    Australia’s modern-day manufacturers are driven by designers, engineers, and researchers who are just as much ‘white collar’ as they are ‘blue collar’.

    Their jobs involve space applications, biotech, robotics, AI, and alike. The difference is that today a career path in manufacturing means the previous production ‘line worker’ is still employed and is now a robotics or logistics expert, as much as they are a manufacturing employee – see REDARC for a most recent example.

    The uptake of such roles by all genders is promising, and you can witness this happening all over Australia, but not behind a desk of those who don’t seek to understand.

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  • New software R&D scheme better than RDTI tinker

    An entirely new, standalone R&D scheme for software companies would be more effective than further tinkering with the existing tax incentive program, according to StartupAUS chief executive Alex McCauley.

    Addressing a public hearing for the Select Committee on Financial Technology, Mr McCauley said the current research and development tax incentive (RDTI) still isn’t working for tech companies looking to make software claims.

    “It’s always been a bit of a square peg in a round hole for software firms to claim the RDTI under the current iteration of the scheme because it’s very focused on research,” Mr McCauley told a recent committee hearing.

    sydney
    Startup city: Industry group StartupAus says a standalone software R&D scheme is worth considering

    “The methodology for claiming RDTI is around development of a hypothesis and then experimental testing. It doesn’t really fit with this kind of agile software development process that most companies use for developing software, so that’s always been a little bit difficult,” he said.

    “We’ve seen evidence that it’s been harder and harder for software companies to claim the RDTI in the last few years.”

    He said that as many as half the software claims under the RDTI that had been audited were eventually rejected.

    “This has been the cause of significant concern both for companies, who now feel that this backbone support policy – it’s the single biggest policy for any government in this country to support software R&D – is slipping away from them as it’s harder for them to claim software R&D under this program,” Mr McCauley said.

    Investors are also now viewing RDTI claims as a potential liability for tech firms, with these firms able to be forced to repay claims up to seven years after making them.

    “We’ve seen that this could run to millions of dollars for some of these companies, which can’t afford to have millions of dollars of debt suddenly spring up. These companies are not yet profitable and are still being backed by venture funding and are still trying to get off the ground,” Mr McCauley said.

    The two main options put forward to fix these issues are to more clearly define the support for software under the RDTI through changes to the language in the legislation, or to launch an entirely new scheme focused just at early-stage companies doing software as their core business.

    Mr McCauley said the latter is the better option, and Liberal Senator and committee chair Andrew Bragg said “that’s a model that this committee would consider”.

    “The advantage there is that we all know that software is becoming more and more a core part of most businesses, whether it’s a bank, a mining company or a tech company, so it is hard to see how you would limit the growth of the R&D tax incentive vis-a-vis software if it were in its current incarnation,” he said.

    “A standalone program targeting companies whose core business is the development of software would probably be a more effective way to do it.”

    There has been growing support for the creation of a standalone program to support software R&D, with Atlassian and WiseTech also telling the committee that a separate scheme may be required.

    Also addressing the FinTech inquiry, Afterpay co-founder and co-chief executive Anthony Eisen said that Australia has a “once-in-a-lifetime” and “once-in-a-generation” opportunity to be a world-leader in FinTech.

    “The current global environment and Australia’s success in dealing with the COVID-19 pandemic can be a catalyst to drive our competitiveness in these industries of the future,” Mr Eisen told the committee.

    “We firmly believe we have the talent and skills, the location and lifestyle and the economy and infrastructure to be among the best in the world,” he said.

    “At a time when Australia has never been a more attractive place to live and grow your career, I firmly believe that, with the right approach, we can secure our spot on the global stage – but the competition is fierce.

    “There is substantial opportunity to increase take-up of highly skilled visas, to fast-track processing and to enhance awareness. This can be supported by globally competitive incentives and tax settings for startups and their employees.”

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  • Academy calls for manufacturing boost for vaccines

    Without the ability to produce vaccines onshore, Australia and the region remain vulnerable to supply shocks and ‘vaccine nationalism’, the Academy of Science says in a pre-budget submission to government that calls for a major investment in manufacturing capability.

    Despite the nation’s 100-year investment in biotech giant CSL, gaps remain in our ability to produce vaccines onshore and at scale, the Academy submission says.

    The Academy submissions calls for government to mitigate these risks through investment in nucleic acid-based technology platforms, which can within weeks of identifying an emerging strain of a virus – whether its COVID-19 or the next biosecurity risk – modify and manufacture at scale a new vaccine formulation that incorporates these mutations.Vaccine

    “Investing in nucleic acid-based technology platforms offers a way to mitigate this risk. Nucleic acid technology shows enough promise to commit to developing a large-scale RNA production capability. Australia needs a strategy for developing additional manufacturing platforms for the years ahead,” the submission said.

    “Developing this capability will allow us to build resilience to future pandemics and potential biosecurity situations that may require us to have the onshore capacity to mass produce vaccines.”

    The Academy’s secretary for science policy, Professor David Day, said Australia has the scientific expertise for RNA vaccines but not the manufacturing capability.

    It said that despite additional investments by the federal government in the 2020-21 budget, the ongoing negative impact of the pandemic on the institutional research sector would become more apparent during 2021.

    The Academy restated its ambition to increase the national investment in R&D to 3 per cent of the gross domestic product as the basis for an uplift in Australia’s national ambition.

    It wants a comprehensive review of the Australian system of research funding to work out the most effective way to support R&D in this country. It says programs like the R&D Tax Incentive scheme will require broad reform and that the nation should pursue a “productivity-enhancing Australian open science strategy.”

    The Academy submission also called for the creation of the new research translation fund to support research not covered by the Medical Research Future Fund.

    “Australia has been able to position itself as a leading biomedical nation. Such a position is no accident but has come from decades of patient investment,” the Academy said. “Now is the time to make similar investments in the physical sciences.”

    “Investments in Australian fundamental science, from mathematics to materials science and beyond, will build our nation’s scientific capital and enable industries of the future.”

    Meanwhile, the Cooperative Research Centre Association has called on government in its pre-Budget submission to introduce a “collaboration premium” of up to 20 per cent to the R&D Tax Incentive program.

    The CRC Association said approximately 30 per cent of Australia’s spend on R&D is through the indirect measure of the R&D Tax Incentive (RDTI). While there was a modest amount of collaboration with universities and research institutes through the program, it was not a focus of the RDTI.

    “We believe incentivising collaboration through the introduction of up to a 20 per cent collaboration premium consistent with Recommendation 2 of the Review of the R&D Tax Incentive, would be an effective mechanism generating new collaboration between industry and research institutes and foster a culture of innovation,” the CRC Association submission said.

    It has also urged government to boost industry-led research through the implementation of a new Industrial PhD program, whereby students are placed within industry for the majority of their program.

    Currently, there are around 400 PhD students doing industrial research at CRCs in Australia, in addition to students undertaking industry-facing PhDs as part of schemes such as the ARC Industrial Training Centres and the Australian Postgraduate Research Intern Program.

    “There is a real opportunity to boost industry experience of research by creating a highly practical scheme where projects are co-designed by industry and a university or research institution and are almost entirely industry-based,” said CRC Association chief executive Jane O’Dwyer.

    “Industrial PhDs create commercial benefits for companies, strengthen universities’ relationships with industry and allow students to see their research applied in real life.”

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  • Cyber CRC backs ‘extraordinary’ AFP hacking powers

    The government-funded cybersecurity research centre has thrown its support behind the proposed “extraordinary” new hacking powers for the Australian Federal Police, its position that is at odds with human rights, civil liberties and digital rights groups, as well as a group of Senators who have all raised significant concerns about the new laws.

    In a submission to government, the Cyber Security Cooperative Research Centre (CSCRC) said the Identify and Disrupt Bill, which hands sweeping new powers to the AFP and the Australian Crime and Intelligence Commission (ACIC) to hack into the devices and networks of suspected criminals, is proportionate, appropriate and safe.

    This is despite the Human Rights Law Centre labelling the powers “absurdly broad” and disproportionate, the NSW Council of Civil Liberties saying they are an “abuse of power” and a group of bipartisan Senators questioning a lack of focus on privacy, no judicial oversight and the potential for innocent people to be impacted.

    Rachel Falk
    Support: Cyber Security CRC chief executive officer Rachael Falk. Photo Credit YouTube

    The Identify and Disrupt Bill was quietly introduced to Parliament late last year and quickly referred to the Parliamentary Joint Committee on Intelligence and Security (PJCIS) for inquiry.

    The legislation introduces three new warrants for the AFP and ACIC to “disrupt” the data of suspected criminals, access their devices and networks and take over their accounts covertly.

    While the government says its focus is on “online serious crimes” including child abuse and terrorism, the warrants will also be accessible for any crime carrying a three-year jail sentence, which include theft, fraud, tax evasion and forgery.

    In a submission to the PJCIS inquiry, CSCRC chief executive Rachael Falk offered full support for the new hacking powers.

    “While the powers authorised under the bill are undoubtedly extraordinary, the CSCRC submits they are proportionate and appropriate in relation to the threats posed,” Ms Falk said in the submission.

    “Furthermore, to ensure such extraordinary powers are not misused, exploited or subject to ‘legislative creep’, the bill contains a number of key safeguards and protections,” she said.

    “It presents a clear opportunity for Australia to ensure domestic laws are properly aligned with digital perpetrated activities, allowing lawful access to data and devices where it is appropriate to do so.”

    Ms Falk did however say that the government needs to better define and refine the crimes the new powers will apply to.

    “Under the Crimes Act such a threshold does cover a wide range of offences, so consideration should be given within the legislation to clearly specify types of crime to which the mechanisms set out in the bill could apply,” she said.

    “The CSCRC submits that if offences that would and would not be captured under the regime were clearly carved out, it would serve to allay fears of misuse of the warrants for less serious crimes and perceptions of legislative creep.”

    Ms Falk also rejected the arguments that the new powers would jeopardise the privacy of Australians.

    “An absolute right to privacy can never exist and there must always be exceptions, especially when it comes to maintaining the common good. There is no doubt that the criminal activities the bill is designed to capture all fall under such an exception,” she said.

    “The CSCRC contends that while privacy is valuable it must have limitations and these limitations must correlate with the social contract all members of the community enter into, upon which modern democracies like Australia’s are built.”

    Ms Falk has previously supported the government’s controversial COVIDSafe contact tracing app, arguing that Australians readily hand over more significant data to the likes of Facebook than what was required by the trouble-plagued app.

    The CSCRC chief has also staunchly supported the federal government’s moves to undermine encryption and assist intelligence and law enforcement authorities in accessing encrypted communications.

    In its submission, the Human Rights Law Centre painted a very different picture of the proposed powers, saying they have a “disproportionate scope” that do not have adequate safeguards.

    “Australia lacks a robust human rights framework that would provide adequate protection against the abuse of the powers contained in this bill. In the absence of those safeguards, the HRLC cannot endorse the expansion of the already-considerable powers possessed by the AFP and ACIC to intrude on the privacy of Australians,” the HRLC submission said.

    The law centre said the proposed network activity warrants, which would allow authorities to hack into the networks of suspected offenders without even needing to know their identities, needed to be “substantially redrafted” in order to “prevent their application to individuals that have no involvement in the commission or facilitation of a relevant offence”.

    The current legislation defines an “electronically linked group of individuals” as two or more people using the same electronic service or communicating electronically.

    This could lead to a situation where a relevant offence being committed on a messaging service like WhatsApp making every user of the service around the world a member of a “criminal network of individuals” under the new powers.

    “On a broad, but not unreasonable, interpretation of these definitions, the effect is that a person who visits the same website as a person engaging in conduct facilitating or constituting a relevant offence is in a ‘criminal network of individuals’,” the submission said.

    “This is regardless of whether the website or communication bears any relation to the offence, or whether the individuals have any knowledge of, involvement in, or connection to the offence.”

    The proposed powers are “absurdly broad”, the HRLC said.

    “It effectively means that, where a person engages in a relevant offence, every other user of any website they access or app that is installed on their phone could potentially have their data accessed, changed or deleted, without their knowledge, consent or opportunity to object,” it said.

    “Not only does this seriously impact the privacy and freedom of expression of individuals with little or no connection to the offending conduct or target individual, it opens up vast swathes of online activity to monitoring by law enforcement without sufficient safeguards to prevent abuse. Even on a narrower interpretation, these provisions still offer expansive scope.”

    The NSWCCL said that the new powers are “next in an accelerating wave, strengthening the powers of the state without any humility about the cumulative erosion of democratic freedoms they entail”.

    “This bill builds on this ominous trend and takes it to a new level, providing unprecedented new powers for law enforcement to interfere and ‘disrupt’ communications of citizens without effective restraint. The abuse of power this bill enables will happen. Enough is enough,” the NSWCCL submission said.

    A coalition of digital rights and civil liberties organisations said that the powers amount to “state-authorised hacking”.

    A bipartisan group of Senators have also raised a number of concerns with the legislation, particularly in regard to a lack of privacy safeguards and judicial oversight and the potential for innocent people to also be impacted by them.

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  • Facebook: Everyone happy but nothing is changed

    After some turmoil, Facebook won the war with the Australian government as the necessary changes were made to the legislation that avoids them needing to make changes to their business model.

    Those subtleties are lost in the general press. What counts for the popular media is that they were able to spin some great stories around the fact that Australia stood up to the giants and that brought international attention which boosted the ego of the Australian Prime Minister Scott Morrison.

    So everybody is happy and nothing has changed. The digital giants remain as strong as ever.

    As mentioned in previous analyses, the way that the Government has approached its battle with the digital giants has been flawed from the beginning.

    Mark Zuckerberg
    Unmoved: The Media Bargaining Code has changed nothing. Photo Credit Anthony Quintano Flickr

    True, its tough stand had made Google pay media companies well above what these companies would have been able to negotiate individually with Google, but the fundamentals of why these battles are taking place are still unchanged and Facebook is also brought into the negotiation deal.

    However, there is no way that Facebook is going to pay any big money.

    Google was prepared to pay these ‘premiums’ to make sure that its business model would still survive. It is the company’s advertising business model that it was keen to protect and for that reason, it was prepared to pay off the news companies.

    On Facebook all media companies benefit from the distribution of their articles on its platform based on the terms of these publishers.

    So, nothing fundamental has been solved by the Australian government through its media code.

    It is now simply waiting for the next battle and the regulator (ACCC) has also already foreshadowed that it will concentrate on that advertising business model.

    This will be a much tougher battle that Australia will not be able to win on its own. Google will use its full legal power with gigantic financial resources to defend their business.

    It also shows that actions from individual governments are counterproductive. The French, who took a different approach, received only a fraction of the money for its media companies than Google has paid to Australian media, so how will that make the French feel?

    Only united action against global digital moguls will lead to structural changes and I have mentioned some of such structural changes as proposed by the EU here.

    In relation to Facebook: I totally agree with Facebook that the government’s action in relation to the way that Facebook distributes news is out of all proportions and, as a matter of fact, totally wrong.

    All news organisations around the world totally voluntary distribute their news to whoever wants to use it. Facebook is not involved in this at all. Unlike Google, it doesn’t abstract content, it doesn’t create news snippets and it does not distribute links.

    All of this is up to the news companies who are providing their services via Facebook. It is totally up to them if they provide full articles, snippets, links, send users to paywalls and so on.

    It is true that all the information that is was blocked by Facebook can be obtained elsewhere. However, Facebook is such a well-known, integrated platform used by the majority of Australians that it will be the organisations who provide services on the platform and are now blocked who are the ones that suffer from this action.

    Common sense has prevailed, and the government has limited the media code to those digital companies that are actively making money from the content of others.

    Unlike Google, the media code doesn’t really affect their business model, so while they now will have to negotiate with publishers, very few if any will push for payments. There never was a general need for them to negotiate as there was, in fact, nothing to negotiate.

    If the government wanted to stick to its media code, it would also have to force Twitter, LinkedIn and others to the negotiation table as they also would have to pay for the same service that Facebook provides.

    You could even argue that telephone and postal services which are used to distribute news should fall under that code – of course, totally ridiculous.

    It is also in the Government’s own interest that it can continue to use the Facebook platform to distribute its own news. Once again, there are other ways to do that, but the reach of Facebook is unsurpassed and as such, very valuable for the distribution of such information.

    Do I let Facebook off the hook? Totally not. But if we want to get control over the digital media and avoid the damage that they are doing to our society, economy and democracy, we need to be far more strategic and we will globally need to work together on those issues.

    Ultimately the platforms have to be treated as utilities. They should be made available on a neutral basis with any organisation being able to use the platform without going through gatekeepers such as Google and Facebook.

    Paul Budde is a managing director of Paul Budde Consulting, an independent telecommunications research and consultancy organisation. You can follow him on Twitter @PaulBudde. This article was originally published here.

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  • Vic govt funds ‘Australia first’ AI program

    The Victorian government has a mission of positioning the state as a “world-leading innovation hub” with significant funding in the recent budget and a new $1.5 million investment in an AI program, Innovation Minister Jaala Pulford said.

    Through its innovation agency LaunchVic, the Victorian government has provided $1.5 million to the newly established artificial intelligence accelerator program Boab AI, which is also working to close a $100 million AI investment fund.

    Victoria has put significant emphasis on tech and startups for its economic recovery from COVID-19, with the state budget late last year providing $626 million to digital infrastructure and $130 million for local startups. This included a new $60.5 million Victorian Startup Capital Fund and a $2 billion Breakthrough Victoria Fund.

    Melbourne
    Melbourne calling: The Victorian government targets the nation’s best AI talent

    “Backing young, innovative firms and startups is how we prepare Victoria’s future economy and grow jobs for Victorians,” Victorian Minister for Innovation, Medical Research and the Digital Economy Jaala Pulford told InnovationAus.

    “With investments in collaborations like Boab AI, we are positioning Victoria to be a world-leading innovation hub that attracts and develops the best talent, investment and artificial intelligence expertise.”

    The Boab AI program, backed by investment firm Artesian, will put 32 artificial intelligence-focused companies through its program over four years, with each receiving a minimum of $300,000 in funding and up to $5 million in follow-on funding.

    The program targets established scale-ups with a product and demonstrable traction, with assistance, investment advisory, partnerships and mentorship on offer.

    The program’s managing director Andrew Lai said it will fill a significant gap in the Australian market.

    “It’s quite a different offering from inception-level accelerators. They’re more about finding the product-market fit and learning about lean startups – cookie-cutter template stuff,” Mr Lai told InnovationAus. “This time around for us it’s what we call portfolio support. We examine teams as they come in and examine their strengths and weaknesses.”

    “In terms of early-stage support there are about 25 accelerator programs in Victoria alone, and at the later stage there are around 100 VC funds.

    “But there’s that gap in the middle of growth capital. That’s our growth thesis. There are a lot of companies seeking growth capital but finding it difficult to raise that pre-Series A round.”

    The organisation is also raising a $100 million investment fund focused on AI, which will provide follow-on funding to accelerator participants along with other separate investments in about 150 companies overall.

    “The intent is to go out internationally to seek talent, for companies looking to do business in Australia or that have an Australian connection. It’s exciting because it’s a way for us to deploy and support AI companies that are not just in Australia but out in the wider region where AI investment is also lacking,” Mr Lai said.

    The state government funding and support is “vitally important” for the Boab program, and for Victoria to achieve its potential in the AI space, Mr Lai said.

    “From our perspective it’s possibly the revolutionary technology of our lifetime and investment in AI is statistically quite low – it’s a big opportunity,” he said.

    “It’s very helpful to have a government not only contribute, but its networks too, it’s very much pivotal. From our perspective Victoria is the most progressed state in terms of initiative. All around the country the latent potential of AI is yet to be reached.

    “But there’s a lot more work to be done. Additional support and development within the translation and commercialisation of research, particularly from academic institutions. Australia is still statistically lagging behind in the OECD on that front.”

    Boab AI has recently announced its first cohort of five startups: Pi.Exchange, Plaetos and Strongroom AI from Victoria, and Daitum and Remi AI from around the country. It is also readying to open up applications for its second round of companies.

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  • In search of a thriving, informed democracy

    As a kid growing up in rural NSW in the 1970’s, watching Irish Comedian Dave Allen on ABC TV was a family event. One sketch I remember vividly: Allen, partially dressed in caveman fur, stands exhausted and triumphant as he lifts a roughly chiselled stone above his head and exclaims victory: “I have invented…THE WHEEL!”. A half second later, a sexy-red race car zooms-by in front of him, on a freeway, leaving him dumbfounded in the dust.

    That sketch has popped into my head a lot in the past year following the stoush pitting New Media – the Big Tech platform giants Google and Facebook – against traditional Australian media companies, the ACCC and the federal government.

    Led by relentless lobbying from News Corporation, the government’s internationally controversial proposed Media Bargaining Code kicked the fight into high gear and even higher hyperbole. It was billed as a battle, not just about the ‘future of news’ in this country (and perhaps farther afield) – but also the future of our democracy.

    Sandy Plunkett
    Sandy Plunkett: Fanciful thinking is behind the Media Bargaining Code

    That any democracy needs a healthy, independent, and diverse media and information ecosystem to thrive is inarguable.

    That the Big Tech platforms have screwed with that system should have been obvious to anyone who was paying attention since about 2005: the scale and economics that drive digital distribution of content are exponentially more favourable than the economics of those who create it.

    But the belief that the government’s Media Bargaining Code was ever the instrument to level the playing field between new and old media of any clout or size, and in turn become the catalyst to save democracy is a fantasy.

    The content deals struck last week between Google and News Corp, Seven West Media, Nine and the Guardian – and the expected deal to be inked in coming days and weeks between Google and the ABC – puts the price of our democracy somewhere in the range of $100 to $300 million dollars.

    This includes the smaller private commercial deals agreed between Google and several independent publishers including Private Media (publisher of Crikey) and Schwartz Media.

    For Google, a corporation which has already paid out fines (for online advertising privacy breaches) in other markets to the tune of billions of dollars, it is a tiny cost of doing business and one they have long expected in one form or another. Striking these deals before the Code becomes law curbs the potential for similar law to be adopted in global markets.

    Facebook, meanwhile, is refusing to pay-to-play and has packed up its ball, (its Australian news feed) and gone home.

    But while the government and big old media are declaring victory, with some international media watchers and analysts cheering them on, there’s no joy for the many smaller independent publishers in Australia – also vital for a healthy information system – who have neither the might nor the resources to bargain effectively with Google.

    So much for diversity.

    I’m not at all suggesting that Australian regulators and policymakers do not have the right and responsibility to ask hard questions or design and enact laws that seek to preserve sovereignty or to foster a fair and competitive media and business environment.

    Australian media and policy makers are not the only ones coming to terms with a present and a future they did not invent and can’t control.

    But like Dave Allen’s “Caveman”, most of the world’s media companies and regulators have stood flat-footed for far too long, armed only with old mentalities and regulatory instruments.

    Meanwhile, new bigger tech-driven shifts are accelerating. For independent writers and publishers there are new platforms such as Subtstack, Patreon, and Clubhouse where individuals can build direct revenue streams from audiences through subscription or recurring one-off payments – avoiding ads in the process. And consumers’ growing awareness of their data privacy will continue to dog the likes of Google and Facebook.

    But there is little doubt that the biggest new, new thing to come into our 21st century technocracy is regulation.

    Every wave of transformational tech throughout history gets regulated – railways, food, shipping and airlines, oil.

    The overlords of the internet and data economy have long known they are next. This regulatory battle has many problems on many fronts in many geographies. The problems regulators and concerned citizens are trying fix include tech companies being bad to other companies, tech companies being bad to users, and bad people using tech.

    The gamut of instruments only recently been proposed span tax, anti-trust, privacy, freedom of speech and censorship.

    “Technology is neither good nor bad, nor is it neutral”. This straightforward though astute observation by American technology historian, Melvin Kranzberg is the first of his six ‘laws’ to guide how citizens and lawmakers should think about the power and pervasiveness of technology and its interactions with economic and cultural change.

    “Technology is a very human activity and so is the history of technology,” he observed in his Sixth Law. “Behind every machine, I see a face – indeed many faces: the engineer, the worker, the businessman or woman, and sometimes the general and admiral. The function of technology is its use by and for human beings – and sometimes, alas, its abuse and misuse”.

    Kranzberg penned his ‘laws’ three decades ago, just before the US-domiciled inventor entrepreneurs founded the likes of Google, Facebook and Twitter and rushed headlong into the future – with blind optimism and mercurial ambition – to create the 21st Century ‘attention economy’.

    Kranzberg was informed by a career immersed in observing technological and societal impacts and the winners and losers that result with each great technological shift. He was analysing the impacts of any technology – from DDT to TV to nuclear missiles. Many innovators held Kranzberg (now deceased) in high esteem.

    The only thing we know about the future of technology, regulation and democracy is that we need many more Kranzbergs. In the meantime, where’s that chisel?

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  • Science calls for $2.4b research translation fund

    The nation’s peak science lobby has called on government to use the expected $2.4 billion in savings from changes to the Research and Development Tax Incentive to fund the creation of a new research translation and commercialisation fund.

    Science and Technology Australia says in a 2021 pre-Budget submission to government that there was an opportunity for a once-in-a-generation, legacy-defining “seismic investment” in science to build the next generation of capability in Australia.

    Such a research translation fund would provide a significant boost to industry-university collaboration rates – an area where Australia has consistently under-achieved – and become a vehicle to turn more university research into products and services.

    Misha Schubert - Science and Technology Australia
    Translation fund: Science and Technology Australia CEO Misha Schubert

    STA chief executive Misha Schubert says there is a funding gap in the existing funding mechanisms for research sectors considered of national strategic importance that are at the “nearly there” phase of development.

    These would include university-based research in such general technologies as artificial intelligence and quantum computing.

    STA has long argued that Australia’s successful response during 2020 to the challenges of the COVID health crisis was no fluke and was instead the result of long-term national investment in science and research infrastructure.

    A next round of long-term investment was now needed to build new sovereign capability that will address the next round of national challenges. The science-based response in 2020 had also given the public the confidence that these investments delivered a return for the country.

    “We think there is an opportunity here for government to seize in the next budget for a seismic investment in Australian science to really assure the capability that we’re going to need for the next crisis, the shape of which we can’t yet anticipate,” Ms Schubert said.

    STA has offered two models for the proposed research translation fund. The first would redirect an expected $2.4 billion in savings from the R&D tax incentive over the forward estimates to create the fund.

    This would have the added benefit of enabling money to flow into the system quickly. It would also create a new policy lever in industry development and help to alleviate Australia’s over-reliance on indirect funding support (through tax incentives) while boosting its direct support (through grants and interest-free loans).

    The second option would be to endow a Research Translation Future Fund. The benefits of this measure would be to create a long-term and more stable research funding resource – just as the successful Medical Research Future Fund has done in medical research.

    However, a future fund model would mean resources would not immediately be available to aid in Australia’s urgent need for economic recovery and sovereign manufacturing capability, STA said.

    Ms Schubert said there was “a very clear trend” developing around the world within comparable economies of large-scale strategic investment in science and research as a key driver of both economic activity and strategic capability uplift.

    “The government has repeatedly in the past year talked about the priority of building greater sovereign capability for the country, and that was reflected in some of the budget announcements in October 2020,” she said.

    “It has talked consistently about the role of science and technology as enablers of job creation and prosperity. Those important public commitments would sit very neatly with a strategic, seismic investment for the next generation of capability that we need to build for our country.”

    “It would absolutely bring to life that aspiration of stronger sovereign capability and stronger job creation in Australia – delivered by science and technology.”

    STA has also called for a renewed commitment of investment dollars for industry-led funding research programs like the Cooperative Research Centres Projects (CRC-Ps) grants program.

    A boost to funding for this program would help to kick-start the recovery and strengthen Australia’s sovereign manufacturing capability, the STA submission found.

    The group also wants government to explore a way to reduce the brain drain of research talent leaving the financially stressed university system. It suggests offering a 20 per cent R&D tax incentive premium to companies that hire STEM professionals who have lost their jobs.

    STA says the 2021 budget investments in science and technology requires three focal areas:

    • Long-term investment and a whole-of-government plan Australia can push forward as an innovation hub for the world;
    • Investment in our future workforce to ensure it is diverse and equipped with the skills it needs to ensure Australia can compete on a global scale; and
    • Ensuring strong links between scientists, business leaders and decision makers to identify and seize new opportunities for Australia.

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