OpenAI breach proves need for more data centres, major parties say

In short:

The major parties say OpenAI's Medicare breach shows the need for Australia to be involved in the development and regulation of AI.

The parties say building data centres for AI training in Australia will secure that involvement.

What's next?

A government taskforce is considering whether Australia's laws are sufficient to prevent future breaches by rogue AI agents.

Labor and Coalition MPs have maintained that Australia must open its doors to AI investment in the wake of OpenAI's data breach, in order to ensure the country has a seat at the table to shape the technology's development.

OpenAI disclosed this month that one of its autonomous agents gained unauthorised access to Medicare health statistics held by Services Australia in June by finding a security workaround.

AI leaders, including OpenAI's chief executive Sam Altman, have been warning that AI is advancing too quickly and its development should be slowed to give society a chance to catch up.

Open AI has paused training of its latest models following reports of the rogue agents breaching multiple government systems, according to Associated Press.

The government has recommitted to introducing "safeguards" against AI in the wake of the Services Australia breach, though those safeguards have not been detailed.

Yesterday, Environment Minister Murray Watt suggested a government taskforce would consider whether Australian law currently allowed for prosecution if a rogue AI agent inappropriately accessed information, "and if it doesn't, that's obviously something we will take into account in developing our new AI standards".

But neither the government nor the Opposition believe it would justify a withdrawal from the AI race, and the data centre rush that would secure access to AI compute and avoid total foreign dependence for the technology.

OpenAI's confession to its 'credit', says Coalition

Deputy Liberal leader Jane Hume told ABC's Insiders program that the government should not try to chase down OpenAI over its voluntary disclosure.

"AI is inevitably going to be part of Australia's future, we want to make sure we are part of the conversation, but certainly the way to go about that is not to threaten criminal action against US counterparts and those trusted partners that we are relying on," Senator Hume said.

"This time, we could only have found out about it because OpenAI fessed up and said that something went wrong."

The government said while little actual damage was done by OpenAI's breach it was a "serious" and unprecedented incident, with Prime Minister Anthony Albanese also directly raising in his meeting with Sam Altman why it had taken the company months to notify Services Australia.

At the United Nations General Assembly, Mr Albanese urged other middle powers to band together to influence the development of artificial intelligence, which is largely being led by AI rivals China and the United States.

US President Donald Trump rejected calls to regulate AI development, saying the US could not lose its lead to China, saying "whoever wins AI wins".

Shadow Defence Minister James Paterson told News24 that he doubted OpenAI's breach was the first — just the first to be disclosed.

"I think it is to OpenAI's credit that they told us," Senator Paterson said.

"This is the first time an Australian government has ever been notified that there has been a breach of this kind from an AI agent. I doubt, personally, this actually is the first time.

"It would not shock me at all if there had been other breaches in the past by AI agents … I guarantee you that if this was an AI company based in the People's Republic of China, and it engaged in a breach of Australian government networks, they will not be sending an email to any inbox to let us know."

Senator Paterson said Australia had a rare opportunity to gain a seat at the table of global AI regulation by establishing data centres in Australia for AI training.

"The truth is right now we are an irrelevant jurisdiction for AI regulation — we are a man shouting at the clouds — but if we get the investment here then we will have a say," Senator Paterson said.

Defence Minister Richard Marles told News24 there was "no hiding" from AI.

"We need to be engaging here. I mean, this technology is coming. There is no putting your head in the sand. And the more we engage with it, the more we have agency," Mr Marles said.

"We are seeking to engage with these companies, engaging in investment in Australia is an important economic opportunity. It is critically important for our national security.

"But, fundamentally, if there is a lesson to be drawn from this last week, what it also will give us is much more agency in terms of shaping the way this technology is developed and making sure that it's developed in a way that is safe for humans."

Senator Paterson said he supported a number of reforms to strengthen AI safety, including mandatory notifications of breaches, independent evaluators and assessors of models, and a complaints pathway for people to report issues with AI.

But the Coalition has also questioned whether the government had done enough to shield Australia's systems from AI, and has criticised Services Australia's four-day delay in raising the breach with the Australian Signals Directorate.

The agency had established a dedicated inbox for breach notifications, but Senator Paterson said it was "extraordinary" that the inbox wasn't being constantly monitored and reported.

Greens senator Sarah Hanson-Young has demanded that OpenAI chief Sam Altman appear at a parliamentary inquiry into AI.

"These big AI companies want to set up shop very quickly, before there is a real understanding of the threats of this technology," Senator Hanson-Young said.

"While we see the big AI companies themselves warning of how powerful their technology could be, they are still really pressuring government to get out of the way while they roll out the infrastructure. That's all a bit rich, frankly."

Mr Altman cannot be compelled to appear before the inquiry because he is overseas.

Senator Paterson said OpenAI should provide relevant senior officials to engage with that inquiry.