Australia Might Have Achieved a Significant AI Policy Advancement, But How Does It Measure Up on the World Stage?

Share this @internewscast.com

This week, Treasurer Jim Chalmers reiterated a commitment to examining artificial intelligence (AI) regulation to determine if it requires new laws or if it can be integrated into existing ones.

Chalmers noted during the government’s productivity roundtable on Thursday that the government plans to hasten the development of a national strategy for Australians to utilize AI technology.

AI has the potential to enhance Australia’s labor productivity by over 4 percent. However, an expert cautions that the advantages might not be distributed equally, as other nations face similar issues.

At the economic summit, Australian Council of Trade Unions (ACTU) secretary Sally McManus expressed her preference for a worker-focused approach in deploying the transformative technology, without advocating for excessive regulation.

AI regulation emerged as a key point of contention between employers and unions during the discussions.

The ACTU advocated for a mandate requiring employers to consult employees before launching new AI tools, whereas business groups cautioned that additional regulations could hinder adoption and diminish productivity benefits.

In a major development, unions and the tech sector struck a deal to design a model that would see Australian creatives paid for their work when it is used to train AI.

McManus described the agreement with Tech Council chairman Scott Farquhar as a “breakthrough”.

“There’s agreement that we’re going to give this a real good go at coming up with a model that makes sure that people are actually paid for what they produce. So that’s a big thing,” McManus said.

Business leaders also acknowledged that the risks of AI extend beyond job losses.

“I emphasized that workers aren’t the only ones at risk. Business owners are facing uncertainties about their future or potential obsolescence,” stated Innes Willox, Australian Industry Group chief executive.

A Productivity Commission report released earlier this month estimated AI could add $116 billion to Australia’s economy over the next decade, but only if the government avoids stifling the technology with heavy-handed regulation.

The government previously announced its collaboration with the industry to create a National AI Capability Plan by the year’s end, outlining ways to increase investment, build industry skills, enhance AI expertise, and retrain workers.

Australia’s cautious approach

The Productivity Commission has recommended the government hold off on introducing new AI-specific laws.

Instead, it says existing frameworks such as consumer protection, privacy, and anti-discrimination laws should be adapted first.

According to its Harnessing Data and Digital Technology interim report, the commission states AI-specific regulations should only be considered as a last resort.

The report also urges the government to pause its work on mandatory guardrails for high-risk AI until these gaps in existing law are fully understood.

It further emphasized that specific regulations should only be introduced if current frameworks cannot accommodate them and when technology-neutral strategies prove unfeasible.

The ‘high stakes’ of AI

According to the report, AI has the potential to lift labour productivity growth by 4.3 per cent over the next decade, but experts caution the benefits may be uneven, and warn that sidelining human oversight could undermine good governance.

According to Daniel Popovski, AI policy and advocacy lead at the Governance Institute of Australia, the stakes are significant with the advent of ‘agentic AI’ — autonomous systems operating with minimal human input.

“Agentic AI is not just about producing content like chatbots do. These are autonomous systems run on very little human oversight. That raises new and urgent questions about accountability, transparency, and workplace governance that cannot be ignored,” Popovski said.

Popovski said the conversation around AI is too often framed as one of job losses, overlooking its growth potential — provided there is a clear strategy in place.

“There is vast potential for growth and development if the transition is effectively managed. The key is to ensure Australians are equipped and supported through these changes so that AI benefits people rather than hinders them,” he explained.

“We need a national AI strategy that sets out how the government will manage these challenges and opportunities.

“Good governance should be human-centric. It should support organisations that adopt AI responsibly and make sure the gains flow to all workers,” Popovski said.

How the global landscape compares

Around the world, governments are taking different paths to manage the rise of AI. Some are prioritising protections for workers through up-skilling, while others are moving ahead with binding rules.

China is pushing for global cooperation, and the United Kingdom and New Zealand are aligning oversight with existing laws.

The US AI action plan directs its labour department to fund rapid retraining for workers who lose jobs due to AI and to guide states on upskilling workers at risk of future displacement.

The EU is proceeding with the AI Act. Obligations for general-purpose AI models started on 2 August, with high-risk system requirements due in August 2026. A voluntary code of practice is already available to help companies prepare.

At the 2025 World AI Conference in Shanghai, China released a Global AI Governance Action Plan that calls for stronger international cooperation, inclusiveness and attention to environmental sustainability.

The UK government has said it will consult the public on AI legislation and is aiming for a proportionate approach that works with existing laws, following its pro-innovation framework.

New Zealand has published its first national AI strategy. It aligns with OECD principles and encourages responsible use while aiming to accelerate private sector adoption and innovation.