Australian Treasurer Josh Frydenberg
Treasurer Josh Frydenberg has handed down the federal government’s 2022-23 Budget, which aims to put cyber security, small businesses and skilled workers at the top of the technology agenda.
Released on 29 March 2022, the budget contains a flagship $9.9 billion investment for creating new national cyber and intelligence capabilities over the next 10 years.
The project - Resilience, Effects, Defence, Space, Intelligence, Cyber and Enablers (REDSPICE) - is the largest investment in the cyber capabilities of the Australian Signals Directorate (ASD).
Pieter DeGunst, CEO, of IT service provider Tecala, was among the IT leaders welcoming the new security measures, especially around more provisions for small-to-medium-sized businesses.
"It’s pleasing to see the government support Australian SMEs to invest in cyber security technology," he said. "It’s an underfunded area and budget constraints is a key issue that is holding back cyber preparedness for many businesses. In addition, in the midst of the biggest tech resource crunch in our history, the investment into STEM development is a welcome development."
Although much of the Budget’s cyber-related spending has been welcomed by the Australian tech industry, there is still some room for improvement according to some.
"There is still work to be done when it comes to giving businesses the right cyber security backing and support, especially considering that 77 per cent of Australian companies faced a ransomware attack last year and a huge majority of businesses simply do not have the time or resources to implement and effectively manage adequate cyber security infrastructure,” said Nick Lennon, Asia Pacific vice president of Mimecast.”
On the REDSPICE announcement, Lennon added that the government was “sharpening its cyber focus and recognising that current geopolitical instability is having a direct cyber impact on private as well as public sector interests”.
“I sincerely hope the initiatives announced in this federal budget get us further down the path towards being a cyber resilient nation, rather than one riddled with weak links in the chain, especially when it comes to SMBs [small- to medium-sized business],” he added.
Meanwhile, Proofpoint Australia and New Zealand (A/NZ) vice president Crispin Kerr said the $9.9 billion cyber investment is a “reminder” for local businesses to “step up their cyber security defences”.
“The investment serves as an urgent call to action for Australian businesses to get serious about cyber security. Those that have thus far paid lip service to cyber security are running out of time to take action as the frequency, sophistication and impact of digital attacks continues to escalate,” he added.
However, for KnowBe4’s Asia Pacific security awareness advocate Jacqueline Jayne, expectations for this budget were already low even before Frydenberg announced it
“The rhetoric has been predictable year after year with ‘lifting up our cyber posture’ and ‘building capability across national priority sectors’ plus ‘improving safety, security and trust’. Please note, there is nothing wrong with those things, it’s what’s missing that is a concern,” she said.
“The 2020 Cyber Security Strategy was delivered without the necessary measurable deliverables and outcomes linked to the human element of cyber security and the budgets have followed suit. Considering the overwhelming evidence that the majority of successful cyber-attacks/breaches are the result of human error, it stands to reason and logic that education and awareness of humans should be non-negotiable.”
‘Concerted focus' on talent required
Another key area of concern for much of the IT industry is the technology and cyber skills shortage in Australia following two years of border restrictions.
To combat this, the government has tabled a $3.9 million program to support more women to take up roles in the digital technology sector.
The government has also introduced a reform to employee share scheme incentives, scrapping the cap on the value of shares that can be issued to non-C-suite employees. Instead, businesses will be able to offer a fixed cap on the amount that employees pay for them. The government has also reduced regulatory requirements for such schemes.
Speaking about the struggles of attracting and retaining talent, Stax A/NZ managing director Adam Beavis said: “The Australian tech sector is struggling to access enough digitally skilled talent to help them realise the opportunities in these areas. We need a concerted focus on creating an environment to support local and international talent, to encourage new graduates to the technology sector and increase the skilled resource pool.”
On the subject, Mantel Group COO Michael Bodle said it “would have been nice to see the Australian government make it easier for companies to hire people from overseas”.
“Currently, it’s too complicated, drawn out and expensive,” he said. “Australia needs a marketing campaign to not only get people to come and visit again, but to live and work here. The competition for tech talent is global – what will make skilled people come to Australia rather than the US or Europe?
“We must remember that we’re also going to lose some of our talent to the US and Europe, now our borders are open, so it would be great to see the Budget helping to not only attract skilled people to come and live in Australia but keep them here, over the long-term."
Lee Hawksley, senior vice president and general manager for Asia Pacific and Japan at Twilio, also lamented the talent shortage owing to the border closures.
“In the last two years, we've completely stopped the stream of qualified international labour and as a consequence, placed ourselves further behind,” he said. “There’s a lot of catching up to do. In the Australian IT sector, labour shortages need to be filled urgently so our local economy and businesses can keep pace with digitisation and continue to compete on the world stage.
“The jobs are there now. Even if we invest more in education and reskilling, which we can and should do, that’s a distant start. Federal budget prioritisation should include offering international talent access to visas, tax breaks for new skilled arrivals and a path to permanent residence.”
'Frantically under pressure’
As part of the new budget, the Treasurer has introduced tax breaks for small and medium businesses investing in new technology and skills.
"Starting [29 March], for every hundred dollars a small business spends on training their employees, they will get a $120 tax deduction, helping them become more productive and competitive," Treasurer Frydenberg said in his speech.
Responding to this, Stax’s Beavis said he welcomed the move. “Australia produces high quality technology talent who develop excellent technology products and services to drive innovation locally and globally,” he said.
Although he also supported the Employee Share Scheme to help retain talent, he also noted the dearth in overseas skills.
“A strong focus on supporting skilled migration is also needed to help reach [a digital-first] future,” he said.
“The government’s redistribution of 10,000 places from the Partner visa category within the Family stream to the Skill Stream will help, but our sector is 260,000 people short of what will be needed by 2025 [according to Accenture research]. We need to create incentives to encourage skilled workers to migrate to Australia.”
Jonathan Perumal, A/NZ country manager at Safeguard Global, added that it was “pleasing to see the government prioritise skills reform in this year’s budget”. This, he noted, includes the allocation of $3.7 billion towards a new National Skills Agreement for jobs of the future and $500 million in tax relief for small businesses investing in upskilling their employees.
“While the skills shortage pre-dates the pandemic, the current environment has exacerbated this challenge across many key industries,” he said.
“It will take time for the industries that are most under pressure to feel the benefits of this funding. And in the interim, Australian organisations are still frantically most under pressure to feel the benefits of this funding ... [and] are still frantically seeking new ways to recruit the skilled workers they need.
“Accessing skills in international markets will not only be a key survival mechanism for Aussie businesses looking to plug their talent gaps – it will also create a foundation for them to enter new markets by building a global team with employees in key locations.”
