Former Australian Minister for Industry and Science Ed Husic has criticised the federal government for backtracking on artificial intelligence (AI) regulation, accusing it of abandoning previously planned mandatory safety rules for high-risk AI systems. He said the government had once considered introducing a standalone Artificial Intelligence Act to establish binding safeguards for high-risk AI applications, aimed at protecting children, mental health, civil rights, and judicial fairness, but the proposal was shelved after 2025.
Current Minister for Industry and Science Tim Ayres rejected claims that policy changes were driven by US pressure, arguing that existing laws are sufficient to manage AI risks. He added that the government has established an AI Safety Institute to strengthen cooperation between government, experts, and the wider community.
At the same time, major US technology companies are significantly expanding investment in Australia. AI company Anthropic has signed a memorandum of understanding with the Australian government, while Microsoft CEO Satya Nadella has announced a A$25 billion investment in AI infrastructure and data centres across the country.
However, experts warn that large-scale data centres consume vast amounts of electricity and water, potentially placing pressure on Australia’s energy supply, water systems, and emissions reduction targets. Reports suggest Anthropic is seeking to secure 5 gigawatts of new computing capacity by 2030, with a long-term goal of 20 gigawatts—an amount comparable to a substantial increase in Australia’s total electricity demand.
In addition, AI companies are reportedly seeking changes to Australia’s copyright laws to allow greater use of local data for training AI models, a move strongly opposed by the creative sector. Analysts say balancing AI investment, creators’ rights, and the public interest will be a key policy challenge for Australia moving forward.
Commentary:
The Australian government is simultaneously encouraging major global tech firms to invest in large-scale data centres while shelving plans for dedicated AI regulation.
In recent years, numerous AI-related concerns have emerged globally, including chatbot systems providing self-harm or suicide-related advice to teenagers, large-scale harvesting and use of personal data, and the use of copyrighted creative works by AI companies without permission for model training. These issues highlight that while AI brings convenience and economic benefits, it also poses real social risks.
AI is undoubtedly a key area for future development, but governments should not focus solely on attracting investment. Clear regulatory frameworks must be established early to ensure that technological development does not outpace oversight.