Assistant Productivity Minister Andrew Leigh has used a National Press Club address to consider what AI can do for our wellbeing.
"The potential of AI to improve human flourishing is substantial", he said on Wednesday, pointing to a study where comforting words written to terminal cancer patients were favoured over those of doctors.
"It has the potential to raise living standards, increase life expectancy and create societies that take better care of the most disadvantaged," Dr Leigh said.
But the caregiving side of AI comes with serious risk too.
Almost one-in-10 Gen Zs have felt like they have been in a romantic relationship with a chatbot, a June YouGov survey revealed.
About five per cent had engaged in sexual conversation with one, and almost 20 per cent had told AI things they had not told a person.
Dr Leigh referenced a Harvard experiment that found a 15-minute conversation with an AI companion reduced loneliness about as much, immediately afterwards, as a conversation with another person.
"People underestimated how much it would help," he said.
"Part of the solution lies in building community: supporting neighbourhood groups, community sporting clubs, community foundations and local charities.
"We need to strengthen these offline options if they are to compete with the addictive temptations of AI-driven social media, chatbots and gaming."
Given AI systems were "grown rather than built", ethical considerations must be embedded in, Dr Leigh said.
The assistant minister was joined by Father Paolo Benanti, an Italian priest who has advised Pope Francis on AI.
It comes as a government inquiry into AI probes major US tech companies and data centre operators about their plans for the future.
OpenAI and Anthropic told the government on Tuesday they hoped to use the content of Australia's creatives to train their models, before moving to question the ethics of data centres on Wednesday.
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