Opinion Pieces

Address to Australian Computer Society

Address to Australian Computer Society

Thank you for inviting me to speak here today at the Australian Computer Society.

It’s always great to back in the land of my birth!

I am very optimistic about Australia’s tech future.

We have the smarts, the capital and the track record to be a world beater ... we can take it up to Singapore, Israel and California.

The Inquiry is now up and running, and in fact we had our first public hearings in Melbourne just last week.

We received a fantastic reaction to our Issues Paper and to date we have received more than 130 submissions.

The Committee will now head to Sydney in late February in advance of an interim report in March.

We have asked all interested parties - big and small business, governments and civil society to pull apart the issues paper and strongly agree or disagree - on the condition that they provide their view on the big things that hold our country back.

Trying to agree on the big challenges provides us with a platform to progress the review soundly as we work to a set of recommendations.

I believe we should separate the shorter term issues from the longer term structural issues.

In this way, we would list the quick wins in March and resolve the harder issues by October.

As set out in the issues paper, we are approaching the Inquiry through five big issues: Capital and Funding; Tax; Skills and Talent; Culture; and Regulation. I call these the big five buckets.

While these are the major categories, there are two narrative contests which must be won.


The first is jobs. It’s a myth that technology destroys jobs. It creates jobs.

Naturally some roles will disappear but we must have an eye to the many thousands of jobs which will be created.

I can confidently assert that FinTech will create more jobs and deliver more consumer choices if we get it right.

McKinsey says: “Most jobs created by technology are outside the technology-producing sector itself. We estimate that the introduction of the personal computer, for instance, has enabled the creation of 15.8 million net new jobs in the United States since 1980, even after accounting for jobs displaced.”

Even you, the ACS, says Australia’s technology workforce is forecast to grow by 100,000 workers between 2018 and 2024; at an annual pace nearly twice that of the broader economy.

AlphaBeta say: “Demand for (tech) skills is set to grow by almost 100,000 people by 2023.


The second is; technology permeates the whole economy. It is not the sole preserve of kids in propeller hats in Collins St.

It’s little understood how pervasive good technology policy can be. Atlassian founder Scott Farquhar says that “there are two types of businesses - tech businesses and business trying to become tech businesses.”

Submissions to this inquiry demonstrate how far and wide technology extends. Engagement from groups like the Business Council of Australia demonstrates the breadth of interest. As the BCA says: “technologies are being applied extensively by existing businesses and start-ups”.

I was delighted to receive a submission from the National Farmers Federation.

As they point out there are already a vast range of applications for digital technology in agriculture which is rapidly growing.

These are applications which include water management and maintenance alerts, remote monitoring and management of livestock, crops and soil, precision chemical and fertilizer application, objective measurement and traceability.

To quote from their submission: “ (Technology) will be critical to maintain Australia’s competitive advantage in food and fibre markets and to deliver on consumer demands.”

Another area where Australia is well placed is in clean energy. A successful Sydney FinTech called Brighte provided a submission to the inquiry. This particular organisation provides a buy now pay later product for clean energy - blending two newish ideas.

Before we make recommendations we should deal with the contested narrative about jobs and the role of technology throughout our economy.


I will now discuss some of the emerging themes from the first set of hearings.


There appears to be a screaming need for more collaboration between Government and small business, FinTechs and RegTechs, and big business.

And that almost certainly points to coming up with ways to get more capital into start ups. The Hayne Royal Commission showed us that Australians need more choice and competition in financial services. FinTech is that bridge. RegTech is a broader economy solution. The new ideas, new competition and new products will not materialise without capital. They will not emerge unless business and government are proactive.

Accordingly I have sought a range of information on notice on how government, through Commonwealth procurement, could help.

I have also asked how large businesses can collaborate with small businesses through their
own procurement policies.

On driving innovation through collaboration AT Kearney noted: “Much of the innovation will require active involvement of the government.”


The consumer data right is the centrepiece of our efforts to ensure consumers can choose different providers. First in banking, then in super and beyond. The CDR will not only help customers switch to cheaper products and offers from FinTechs, but it will also encourage more competition with respect to the largely homogenous products offered by the big banks.

A lot more work needs to be done to achieve a smooth transition to Open Banking. The Committee has heard views on the culture of four pillars. Some think we should have more pillars, not four pillars.

It has been suggested there should be different classes of CDR licences for suppliers and intermediaries and there have been cost concerns about accessing the system.

One particular issue which dominated the Melbourne hearings is “screen scraping”. It has divided the sector, from strong support to downright contempt.

Verifier, who have led the campaign to ban-screen scraping said: “Without an end to screen scraping, you won’t see the focus on acceleration of the ‘safe rail’ options by the players who do most of the data sharing in the market. Many FinTechs and data companies are content to sit back - comfortable with the screen-scraping status quo.”

In contrast, Fintech Raiz said in their submission: “Screen scraping provides a lower cost alternative for smaller FinTechs and institutions to innovate faster and meet their compliance obligations under any new regime. Screen scraping needs to remain a valid data collection method.”

This is an issue I hope to deal with in the March interim report.


Tax is another one of those subjects which seems common to almost every respondent. We have seen and heard common views and disparate views... I can’t go into all of them but I can tell you it’s a key area which needs closer examination.

For example, FinTech Australia tells us the R&D tax incentive is the number one regulatory issue for Fintechs.

They tell us the importance of the R&D tax incentive to the industry cannot be underestimated, as evidenced by the large number of FinTechs which have successfully applied or are in the process of doing so (64%).

Further, they say 76% of Fintechs indicate the R&D incentive helps keep aspects of their business on shore. Understandably they argue the rate of corporate tax in Australia is high, particularly when compared with other countries, such as Singapore which has a corporate tax rate of 17%. FinTech Australia is positive about the early stage innovation companies scheme (ESIC).

Qualifying companies must be incorporated in Australia, have total expenses less than $1 million in the previous income year, assessable income of $200,000 or less, and shares must not be listed on any stock exchange. The company must meet a 100 point innovation test or a principles based innovation test.

One question I am asking is, has this ESIC scheme worked?

FinTech Australia says it’s a world leading scheme but says it’s not well understood and appears to be underutilized.

Maybe the ACS can help?

Payroll tax is another issue which just keeps coming up. Of course it’s a state impost not federal, but it has attracted almost universal condemnation in the feedback we have received.

Australian unicorn Airwallex has suggested a new category of payroll tax specifically for young, high growth organizations at a higher threshold and lower rate.

Airwallex argues the benefits would be twofold: 1, increasing local investment in onshore teams, and 2, supporting young organizations to effectively establish themselves in the market. According to Airwallex this would translate to more local jobs, faster business growth, and higher net tax revenue in the long term.


Another challenging and recurring theme is how we get get more capital into FinTech and RegTech. It seems the obvious place to go is the biggest honey pot in the country ... the $3 trillion superannuation industry.

It would be remiss of us if we didn’t look at innovative ways (or even traditional means like tax breaks) to lure super funds into investing in our technology future.

Startup Bootcamp proposed a model adopted in Singapore where the government offers tax credits to super funds for investments made into fintech and regtech startups.

This idea is worth looking at.


Regulatory culture is also critical. Our culture must welcome new ideas like buy now, pay later schemes. I am open minded about how this could be better facilitated in future.

Yes, we want to implement all of the Banking Royal Commission changes, but we don’t want to reinforce the competitive advantages of the incumbents.

A new tool ASIC has been granted is the product intervention power. We want ASIC to use this power to protect consumers. We do not want this power to stop new ideas and new products which give consumers more choice.

The trick is to balance innovation and consumer protection. It shouldn’t be a choice.


At the end of the day we want two things. More Australians to get a better deal and more jobs.

It’s a fact that better technology means improved choice.

Australians can only benefit from being given wider choice - whether it’s in open banking, an open telco sector or open super.

The challenge before us is to think globally whilst developing locally.

Future jobs depend upon it.

The process I am chairing will deliver a complete picture of what we need to do I know we have the right people in the key jobs to push through the changes.

Right people, good process.

All we need now are your best ideas.

Thank you

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