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SCOTT MORRISON: ‘Our challenge is to keep the foot on the digital accelerator’

- October 24, 2020 10 MIN READ
Prime Minister Scott Morrison
This year has been a thunderclap to so much of what we assumed to be normal.

While some parts of the economy, by virtue of the pandemic restrictions, were frozen in place, others had to accelerate at warp speed.

But all of us have had to adapt and to find a place of resilience and resolve.

In the first three weeks of this pandemic, a quarter of Australian businesses changed the way they deliver. Almost a quarter changed what they deliver. Diversifying into new products and services. And almost a third of them expanded their online presence.

One study found that during COVID, nearly 9 in 10 Australian firms took on new technology to support business continuity. As businesses went online, customers followed.

A study by McKinsey found that we vaulted 5 years forward in consumer and business digital adoption in around 8 weeks.

Now we’ve all heard the amazing figures from Australia Post, 26 million more parcels between March and May, delivering an average of 2 million parcels every single day.

In April, 5.2 million Australian households bought something online. I was one of them, more than once.

More than 200,000 of those were shopping online for the first time.

In August online sales reached over $3 billion, an 81% increase on August of last year.

We’ve seen that acceleration in other areas of digital life, in areas like telehealth and remote working.

In the first few weeks of lockdown, over 40% of small and medium businesses bought or installed the software for remote working. Another 22 per cent, said they were headed in that direction.

Now that’s almost two thirds of Australian SME’s with new capability and flexibility. New technology at their fingertips.

 

The digital acceleration

This year, the imperative of what we faced drove this adaption and adoption.

Aircraft manufacturers started making ventilator’s, gin distilleries started making hand sanitiser, and local cafes moved online and got people ordering home delivered dinners. Kept Josh fed all the way up until the Budget I can assure you.

Our challenge is to keep the foot on the digital accelerator.

As we emerge on the other side of this pandemic, whilst we can marvel at the innovation and the digital acceleration. The bigger picture is that our economy has taken a massive hit.

So we have two stories happening simultaneously now here in Australia, an economy that is experiencing the worst set of economic circumstances since the Great Depression, devastating and ferocious adaptation that businesses have engaged in to keep these circumstances at bay, and their effects.

Today, I want to talk about these twin interconnected stories.

From the earliest days of this pandemic, the government’s focus has been on getting through to the other side, that bridge to the other side.

And the centrepiece of that has, of course, being JobKeeper, the biggest financial lifeline to Australians in our history, a $101 billion dollar economic lifeline that has supported three and a half million jobs. Just think about that for a second.

The cash flow boost to small business helped more than 800,000 small to medium sized businesses stay afloat.

As I’ve said for many years, in good times and in bad times, our economy is not an end in itself, our economy is always about people.

Our support now is about a journey back, a journey back to jobs for Australians.

And our Budget does that by bringing forward decisions on investment, on jobs and on tax cuts, and by laying the groundwork for recovery with affordable and reliable energy, with lower emissions, cooperatively reforming workplace relations to get more people into work, increasing and bringing forward infrastructure investment- small and large, driving deregulation cutting the red tape, making it easier for Australian businesses to do business – more important than ever in these circumstances.

And arguably, most importantly, investing in the skills of Australians so businesses can get the skills from Australia’s that they need for their businesses to succeed and Australians of any age can get the skills that will put them in jobs and keep them in jobs well into the future, helping our businesses make the leap to a post pandemic world.

The digital economy is central to these tasks, to creating the jobs that Australians need. The speed of change in the digital economy means that our training system needs to be fast and responsive.

The pace of technological change means people are more likely to need to regularly reskill.

Small business tech spend

These are the facts.

A recent study suggested that by 2040, Australian workers will on average need to increase time spent learning new skills, all of us, by a third – 33% over their lifetime, learning never stops.

That’s why we are undertaking ambitious skills reforms to ensure our vocational education and training system is responsive, forward looking, dynamic, trusted.

We are piloting a digital skills organisation to ensure digital training needs meets the skill needs of employers. Employers and employees, that’s what training’s about. Not trainers, not providers. It’s about the people who use it and the people who need it.

And we are investing $1 billion in the JobTrainer fund together with our partners in the states and territories to deliver up to 340,000 free or low fee training places in areas of skills needs such as information technology and cyber security this financial year, right now.

It’s not only individuals who have to prepare for such change. Every Australian business also must grasp what is before us.

Last year I was seeing studies that showed Australian small businesses were spending less than 1% of their revenue on technology.

When I was Treasurer, it used to really frustrate me, I’ve got to say, it used to trouble me that small and medium sized businesses, particularly small, were not yet taking up digital technology as fast as they could. And this was holding them back. That was the frustration.

So I asked Mark Bouris, well-known to so many, to look into this. And he said to me when he came back, having reviewed this for a period of time, and he’s very frank in usual way, he said mate, small businesses aren’t looking to the government for ideas.

Fair enough. Fair enough, Mark. I’m pretty sure you’re right about that.

We can’t make that easier, but we can make it safer and easier to get paid by doing the things we can do digitally online to make payments, to connect with customers and deal with government we can do that.

 

Be the best at adopting

And with the JobMaker digital business plan in this year’s Budget, some $800 million. We’re basically upgrading the circuit boards of our economy.

That’s the bit we can do. We’ve gotta do our part and we’re doing that.

This is about using the gains we’ve just made this year as a springboard to become a leading digital economy by 2030.

I said that after the last election. That’s where I want to see Australia go, because there’s jobs there, there’s incomes there, there’s wages there, there’s investments there, there’s opportunity there.

An economy where our leading industry sectors, mining, agriculture, manufacturing, services, as well as small businesses all around the country, are at the global frontier of technological adaptation, enable them to scale up and grow.

That doesn’t need to be- mean that Australia has to be one big Silicon Valley. No, we’ve just got to be the best at adopting. Taking it on board. Making it work for us. And we’re really good at that.

Where workers across the country, including in regional areas, have the digital skills and capabilities they need to take advantage of new and changing job opportunities and where we have a trusted, secure and safe online world for Australians, particularly our kids also, to keep them safe from the dark forces we know are out there.

But also our businesses and the essential services upon which we all depend each and every day.

 

Making it easier to do business

So our plan brings all that together. Investments actually beyond the Budget of some $4.5 billion in the NBN, $1.67 billion in cyber security.

As I said before, some $800 million in investments in 5G digital skills capability, regtech, fintech, open banking and a massive innovation in Australia, the consumer data right. Right out there in front of the rest of the world when it comes to how data is understood in this country and in the world as having real value.

They all sound pretty high-tech, I know as you’d expect, but at the heart they’re all about one thing – making it easier and safer to do business. That’s just simple.

A part of the plan is making sure that our regulatory system is up to date. It doesn’t create barriers. They’ve lost all meaning in the digital age.

Much of our regulation, you know, was written back in the time of Casio calculators.

It needs to be operative in our digital world. It’s about making it faster and easier also to deal with government online. We’re doing our bit.

The digital identity system already helps business do that, and we’re continuing to improve and expand that system to make access to government services more secure and more convenient.

We’ve been working for a while and making it easier to register a business, taking 32 – that’s right – separate registers and consolidating them into one.

In the digital business plan, we’re mandating e-invoicing for government agencies by July 22 and looking at options to mandate the invoicing for business as well.

Doing it digitally reduces the cost of an invoice by around two thirds. Why wouldn’t you want to do that? It’s common sense.

And if we have the systems and procedures in place to pay on time and pay more quickly, everybody wins.

Our new payments platform in Australia is the most advanced of its kind anywhere in the world.

Real time payments.

And that helps us, along with so many other areas, supporting fintech to get a foothold in international markets and encourage foreign investment and job creation here in Australia.

I’ve always been very passionate about fintech for a long time, especially when I was Treasurer.

I launched Australia’s FinTech positioning paper back in 2016, brought some of the most bright, forward thinking fintech thinkers and entrepreneurs together to guide how we were setting up our fintech industry here in Australia.

There’s no politics in that. Most Australians wouldn’t be that familiar with what happens in the fintech space.

But I saw very quickly, I knew how important it was going to be, for how our economy operated and the people who work in that sector I’ve always just found incredibly exciting and inspiring.

Even four years ago, it seemed all a bit futuristic as they’d share their ideas about what was possible and in a very brief time, that’s translated, and it’s reached every corner and cranny of our economy.

And it’s not just the Bitcoin or blockchain. It’s GoFundMe. It’s Kickstarter. It’s AfterPay, Apple Pay, Google Pay, its phone banking apps. These are now becoming very familiar.

We carry them in our pockets, our keys, our phones, and fundamentally they just make business easier, they also make life easier.

And we can expect more and more innovation in our fintech sector and we can expect Australian fintech entrepreneurs and innovators to be in the leaders of the pack around the world.

We can expect fintech to open doors to more markets and opportunities here and across the world.

Our digital business plan is just the start of our journey to becoming a leading digital economy by 2030, and it’s already happened.

The task force and my department continue to lead the work across government and with industry to build on this substantial investment.

 

Still far to go

The digital world is not bound by geography or tyrannised by distance. All the old things that often held Australia back, all flipped on their head now.

All our business practises and supports and the regulations were set up in the analogue world, as I said, not the digital world and this year has reminded us of this.

And also remind us how far we still need to go.

We need to get our rules and our systems to catch up to what our technology now allows us to do.

That’s the task for government.

We’ve got to get this moving and we are.

We’re leading work with other countries and seeing in that light by other countries to make it easier to do business across borders with free flows of data and an open, accessible and in a secure online environment for those things to take place.

In the World Trade Organisation, Australia is chairing leading negotiations on the trade-related aspects of electronic commerce.

That involves 85 nations that account for more than 90% of global trade. There we are driving the bus.

At the regional level, the landmark Trans-Pacific Partnership contains the region’s first set of digital rules to support the free flow of data and facilitate digital trade.

That includes prohibitions on customs duties, on digital products such as software or music, and promoting paperless trading through electronic customs forms and authentication.

And we are working with individual, like-minded nations in our region to raise the level of ambition in this area.

The world-class Australia-Singapore Digital Economy Agreement is a digital bridge that features modern, upgraded rules to free up data flows and increase compatibility for online trade.

It eliminates unnecessary restrictions on where data has to be stored, at the same time protecting personal data and consumer rights.

It makes government information easier to access and government rules easier to follow.

It covers everything from AI to ID, e-invoicing to e-certification, data protection to protecting kids from online harm.

It’s a massive step forward.

It’s the benchmark now.

And there are many more steps still ahead of us in this space.

And I thank Prime Minister Lee and the Singaporean government, who’ve been such a wonderful partner to strike this agreement and we’re working to strike more digital economy agreements with other partners in our region.

Australia has also been a strong contributor to the OECD’s Going Digital Project, which is assisting countries to adopt digital policies for stronger economic growth.

Good for them, it’s good for us. We all win.

And Australia’s candidate for the position of Secretary-General of the OECD, Mathias Cormann, would continue to boost this important work and drive implementation of OECD recommendations to support the recovery from COVID-19.

Open, liberal, market-based economies trading with each other. That’s how the world comes out of this.

Not by shrinking, not by hiding, not by withdrawing, but extending out in new and safe ways, charting new territory.

This is what we’re doing. It’s very exciting. And Australia is in the vanguard.

All of this digital transformation, it’s not an Everest we have to climb. We’re not just doing it because it’s there.

We’re not trying, as I said, to create the next Silicon Valley here in Australia. That’s not it.

We’re doing it because we’re a practical people and we get it.

It’s a massive productivity boost to our economy.

The biggest game changer, arguably, the world has ever seen.

It saves huge amounts of time, money, energy, resources and space.

You don’t have to be a tech-head.

You don’t have to be someone who was totally absorbed in the technology of this to understand its implications.

You know it works. You know it’s going to change our lives.

It comes with risks, sure. And we’re protecting against those.

But we know it creates untold opportunities to innovate and find new markets.

Customers, progress and prosperity.

It is a massive priority of my Government.

It puts our businesses, large and small, on the frontier of the digital world.

COVID-19 has pushed that frontier further forward. Let’s push past it. Let’s keep going.

Being competitive, adaptive, becoming more productive and innovative. That’s our path to a post-COVID recovery.

A recovery, jobs, investment and a better future.

These have been very dark times, but amongst this darkness, there have been some real shards of light that have been coming through.

Most significantly, the resilience and determination and innovation of the Australian people.

The only assumption I made in this Budget is about the Australian people and what they can achieve and what they can do and I back that assumption every day.

 

  • Scott Morrison is Prime Minister of Australia.
  • This is an edited version of his keynote address to the The Australian E-Commerce Virtual Summit on October 21.