Treasurer Jim Chalmers is hoping to use AI as a weapon in Labor's second-term battle against languishing productivity after the Productivity Commission's interim report determined it could transform the global economy and add more than $116 billion to Australia's economic activity over the next decade.
Aspirations for AI have long been dogged by concerns it could replace human jobs and draws data from dubious or potentially stolen sources.
But Dr Chalmers insists Australia can both wrangle the risks and reap the benefits of AI.
"Our approach is a sensible, middle path," he told reporters in Canberra on Wednesday.
"I'm very conscious and attentive to the genuine concerns that workers can have about big changes in technology and it's hard to imagine a bigger change in technology than this one.Â
"Technological change typically creates more opportunities than it discards, but the nature of work is always evolving and always changing
"We don't want to see people necessarily put out of work - our job is to make sure that people have the skills they need to adapt and adopt this kind of technology."
The Productivity Commission urged Australia to hold off from imposing guardrails on high-risk AI and only introduce technology-specific regulations after amending the rules and frameworks already in place.
"Poorly designed" regulation could stifle the adoption and development of AI, "limiting a potentially enormous growth opportunity", Commissioner Stephen King said.
But the ACTU has accused the commission of taking a "knee-jerk" stance and selling out workers and industries.
"The Productivity Commission's only ambition for Australia's digital future seems to be that we turn ourselves into a mini version of the United States where tech bros get all the benefits of the new technology, and productivity benefits are not fairly shared," ACTU assistant secretary Joseph Mitchell said.
A united front of Australian screen industry bodies including the Australian Writers' Guild and the Australian Directors' Guild has pushed back on the report, specifically its considerations on copyright.
"A remuneration scheme is essential to maintaining the livelihoods of creators and authors to ensure they are fairly compensated for the exploitation of their work on AI platforms," Australian Screen Directors Authorship Collection Society executive director Deb Jackson said.
"Without this there is a significant threat to Australian creative innovation and economic growth in the creative sectors."
Greens senator David Shoebridge warned a hands-off approach to AI would "continue to rip off creators and spy on individuals" and Opposition Leader Sussan Ley echoed those concerns, calling on the government to protect Australian content.
"We need a government that backs in our artists, our writers, our musicians and our unique and special Australian content," Ms Ley told reporters.
"We should embrace the technology with respect to AI, but we have to get the balance right."
The federal government's report published in September found AI can amplify biases, contribute to misinformation and disinformation, spread extremist content and create other new risks.
Some business groups have supported the cautious recommendations on regulation, with the professional accounting body, CPA Australia, urging the government to help businesses adopt AI through incentives and educational programs.
Dr Chalmers promised to listen to workers before an August economic roundtable on improving productivity to lift living standards.
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