Australian government to pour AU$800m in digital business push

4 years ago 145

BOOK THIS SPACE FOR AD

ARTICLE AD

The Australian government has announced it will expand its digital identity system, touting that the move will allow more businesses to securely access government services online as part of its newly announced AU$800 million Digital Business Package.

The opt-in service allows users to verify their identity once before gaining access to over 70 government services, rather than having to continually be verified by each Commonwealth entity. It is currently being used by 1.6 million Australians and 1.16 million businesses.

"We need our businesses to be online, we need them to be digital businesses," Prime Minister Scott Morrison said on Tuesday.

"In recent months we have seen through COVID a rapid acceleration produced by necessity of businesses really engaging and upgrading their digital capability. What we're announcing today, will build on that. It will strengthen it and it will accelerate it."

The package also includes AU$28.5 million dedicated towards rolling out the Consumer Data Right (CDR) in the banking and energy sectors. There are also plans for that investment to be used for applying the CDR to mortgages and personal loans by the end of the year.

The Commonwealth has also vowed that all government agencies will adopt e-invoicing by 1 July 2022 to allow small businesses transacting with government to be paid faster. In addition, it has proposed to pay e-invoices within five days.

"90% of small and medium businesses today still use paper-based invoices, and if you take the Commonwealth together with the states, governments are responsible for around 10% of all business invoices," Treasurer Josh Frydenberg said.

"It is hoped that the Commonwealth by taking the lead in e-invoicing will lead to states … to follow in the Commonwealth's lead in this respect."

Other elements of the package include implementing a modern business register program, with the biggest single component of the package being valued at AU$420 million. The idea is to allow businesses to view, update, and maintain their business register in one location.

Additionally, AU$29 million has been allocated toward accelerating the rollout of 5G, which includes running trials in sectors such as agriculture, mining, logistics, and manufacturing.

The federal government also announced initiatives aimed at cutting regulatory red tape, such as placing AU$7 million in two blockchain pilots that aims to reduce business regulatory compliance costs and nearly AU$11.5 million for regtech commercialisation.

The decision to make temporary reforms that were introduced during the peak of the COVID-19 pandemic, such as enabling annual general meetings to be held virtually and for documents to be executed electronically, permanent were also a part of the federal government's announcement on Tuesday.

The rest of the funding as part of the package will be allocated to helping businesses adapt to technology, government said. This includes just over AU$22 million for expanding the small business advisory program, AU$9.6 million for promoting Australian fintechs overseas and attracting inward investment, and a AU$2.5 million injection into digital skills training for small and medium-sized businesses.

"We should see all see digital transformation as an opportunity, not as a threat … we want new businesses in Australia to be born digital," Frydenberg said.

The AU$800 million package will be included in next week's federal budget, which Morrison said would be the "most important budget since the Second World War".

"The budget will confirm the strong plan we have for recovery for economic recovery from the COVID-19 recession and to build our economy for the future, to continue to cushion the blow to continue to recover what has been lost … that's what this budget is about," he said.

Shadow Assistant Minister for Treasury Andrew Leigh agreed that while technology is "incredibly important", he warned about the need to consider the flow-on effects.

"There's going to be some level of job displacement that comes from technologies such as automated checkout within retail or greater use of robots within factories. So that'll have impacts on the labour market, and I don't see from the government a sense that they've really thought this through for the long term," he said on Tuesday.

Leigh also raised concerns about the government's ability to deliver the initiatives announced in the package.

"You've just got to look back at the census fail and the robo-debt disaster to worry about the government's ability to really get it right when it comes to technology," he said.

"Rationalising business registers is something that Parliament passed previously, getting a director identification number is something that should have been done years ago. Some of these measures are re-announcements to the extent that they're fresh. We'll obviously look through them carefully.

"But the best way of getting Australians engaged with technology is to expand education, and right now you're not seeing that with universities. You're not seeing an expansion of universities, which should take place at an economic moment like this."