Australian ICT Industry unites behind call to think technology first

Friday, 20 March 2009

For the first time in Australia, a wide section of the ICT industry has joined forces to urge the Australian Government to take urgent steps to increase investment in innovation and the nation’s technology infrastructure. 

In a letter to the Prime Minister endorsed by the Australian Information Industry Association (AIIA) National Board, the industry has requested an audience to discuss four major recommendations needed to grow the Australian ICT industry. 

These recommendations will create jobs, new technologies and systems that will transform the way other industries operate and provide Australia with a new competitive edge to succeed in the global economy.

Ian Birks, CEO of AIIA said, “The industry is united in its call for increased investment into the future of the technology industry, as well as improving the nation’s technology infrastructure.”

“Currently, investment in technology is not called out in the proposed economic stimulus packages even though the Gershon Review explicitly highlighted the need to invest in new technology and systems to create productivity, environmental and social benefits.  We are looking to discuss these recommendations, on behalf of the entire ICT industry, with the Prime Minister.”

In its letter to the Prime Minister, AIIA has expressed its desire to work closely with the government to implement the reforms outlined in the Gershon Review.

The four key recommendations are:

Putting Technology First

‘Technology first’ is as much a way of thinking as it is a way of doing things.  The current financial climate presents a unique opportunity to make Australia smarter and more competitive than ever before.  Nations that take a ‘technology first’ approach and implement advanced digital infrastructures will be best positioned to succeed in the global economy.

‘Technology first’ does not mean investing in new technologies and infrastructure at the expense of investment in other areas. Rather, it means the intelligent planning of all investment to ensure that the benefits of smart technologies contribute to the best possible outcomes.

For example, all school halls and libraries should be planned and built to incorporate wireless technologies and high-speed broadband; this will not only create collaborative teaching workplaces and enhance the investment being made in the Digital Education Revolution, but also has the potential to deliver flow-on benefits to local business communities and social networks.

The roads and highways being built today will serve Australia long into the future; in line with comments made by Senator Conroy recently, these projects would benefit considerably from the incorporation of ‘smart sensors,’ not only to aid maintenance, but also to provide a more detailed understanding and control of traffic flow.

Investment in information and communication technology will be essential to the reform of healthcare in Australia.  Last November, however, COAG quoted an investment of $64.4 billion over five years to implement the National Healthcare and Ageing Agreement – without reference to the potential for technology to deliver better quality and more efficient health services. Smart technology will be essential to successful healthcare reform.

There are already a wide range of available, tested and successful technology solutions to aid low-carbon footprint building solutions. Additionally, all new housing and office work should consider the requirements of networking and connectivity at the outset of planning.

Producing jobs and benefits across the economy’

The Information Technology and Innovation Foundation (ITIF) recently conducted a study in the US demonstrating that an investment of US$30 billion in American IT infrastructure across three key areas – electronic healthcare, broadband rollout and smart energy grids – would directly lead to the creation of over 900,000 jobs, with more than half of these in small business.  According to the ITIF, “IT infrastructure offers superior job creation benefits” compared to investment in traditional infrastructure by an order of magnitude, “because digital infrastructure… serves as the foundation for a multitude of innovative products and services.”

Through an investment in a digital infrastructure, Australia can enjoy the same benefits of a digital economy which can be realised across industries, not just the ICT industry.  Such an investment would allow Australia to position itself to compete successfully in the new world economy.

The study by ITIF links to research by the former Department of Communication, Information Technology and the Arts.  The research revealed that ICT contributed up to 85 per cent of productivity growth in the manufacturing sector and up to 78 per cent of productivity growth in the services sector over the last two decades.  It also identifies technological innovations as one of the main drivers of long-term productivity growth.

Investment in smart infrastructure and digital technology solutions will not only stimulate growth in the short term, it will return exponential benefits for years to come in the form of new jobs, higher employment, better business efficiency and more competitive industry.

Recalibrating Australia’s economy for the future

Smart infrastructures and digital technology solutions lead to higher quality education and the cultivation of essential new skills in the economy. It also provides the foundation for better connected communities, a low carbon economy and the transformation of healthcare.

This investment is essential if Australia were to remain competitive – beyond the resources boom we currently enjoy.  In an increasingly digital global marketplace, Australia needs to create and maintain a comparative advantage in the global digital economy or risk becoming redundant. Many of our international partners and competitors have already made considerable progress along this path.

Investment in smart technology should be stimulated by appropriate government policy. Tax break incentives that spur these outcomes are welcome; however current proposals to limit these incentives to hardware alone do not go far enough. Hardware typically represents less than 20% of the cost of a sophisticated technology solution. Software and services – accounting for the remainder of that investment – must also be included. AIIA recommends a 150% tax deduction against the total system investment as a viable and necessary economic stimulus.

Investment in digital technologies offers wide-ranging returns across the entire economy and investment in digital infrastructure is by far the best means of stimulating employment. These investments will not only prepare Australia for the global digital economy, spur employment and stimulate innovation, they offer benefits that no other investment can match.

Improving the way Australians live

An investment in technology will enhance the way we live.  With a smart energy infrastructure which relies on broadband data streams and advanced analytics, Australia will be able to intelligently manage power consumption, integrate renewable energy sources and reduce its carbon footprint significantly.

Electronic healthcare initiatives have the potential to revolutionise the way services are delivered.  Besides driving efficiency across a system, electronic healthcare will meet the challenges of distances, an aging population, skills shortages, distribution problems and limited budgets. These initiatives will save both lives and money.

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For more information, please contact:

Gabriel Wong
(02) 9954 3492
gabriel.wong@maxaustralia.com.au

About AIIA

The Australian Information Industry Association (AIIA) is the nation’s peak industry body for the technology sector. AIIA sets the strategic direction of the industry, influences public policy and provides members with productivity tools, advisory services and market intelligence to accelerate their business growth.

AIIA member companies employ 100,000 Australians, generate combined annual revenues of more than $40 billion and export more than $2 billion in goods and services each year.