The industry responds to Budget 2025: Small businesses need more support

At the same time, we're seeing artificial intelligence emerge as a major force multiplier for productivity, but, again, this year's budget seems to have placed AI on the backburner in favour of buying votes.

With all that being the case, the industry’s response to this year’s budget is unsurprisingly muted… If not downright disappointed at the government’s lack of urgency.

Anthony Daniel
Regional Director – ANZ at WatchGuard

It’s encouraging that the Government continues its commitment to small businesses, with over $60 million allocated since the 2023–24 Budget to the Digital Solutions program, Cyber Wardens, Small Business Cyber Resilience Service and Cyber Health Check.

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These programmes represent important progress, but many SMEs still lack the resources, in-house expertise and support to respond effectively to growing cyber threats. As the backbone of our economy, they need more tailored assistance to strengthen their cyber resilience.

If we are serious about building national cyber resilience, future Budgets will need to invest more directly in helping SMEs access the tools, training and support they need. This would deliver immediate and measurable impact across industries, supply chains and local communities.

Chris Freeland AM
CPA Australia Chief Executive Officer

Businesses and their advisers will find little in the federal Budget that will help offset the pain all-too-many small businesses have been experiencing.

The Budget lacks ambition and a thorough understanding of what business needs. Not enough is being done to slash red tape or create the conditions and improve policy development that would shift the dial on Australian productivity and competitiveness.

Though the emphasis on relieving pressures on household finances was expected, a more business-centric Budget would have benefitted all Australians because small businesses are significant contributors to the economy and job creation.

Mathavan Parameswaran
RSM Australia National Technology Leader

Investment into AI training and implementation has been very much front of mind for the technology sector on the back of lower productivity and concerns around Australia’s competitiveness on the global AI stage.

After missing out on a substantial investment into AI in last year’s budget, we are disappointed to see no further announcements in relation to investment into AI.

While the development of the National AI Capability Plan back in December was a positive first step, the lack of continued investment in this year’s Federal Budget will make it even tougher to achieve success and for Australia to be competitive globally.

More broadly, technology will be critical in overcoming Australia’s productivity woes and investment into digital literacy nationwide is critical in driving further technology adoption and investment would have been welcomed by the sector had it been provided.

We do welcome the announcement of $2 billion being recapitalised into the CEFC to allow for further investment in renewable energy, energy efficiency and low emissions technologies.

Tony Burnside
SVP and Head of APAC at Netskope

This budget probably needs to come with a few disclaimers. Because it was delivered just weeks before the election, and with a cost-of-living crisis on its hands, the government understandably prioritised investments designed to alleviate that pressure for voters. We may also see a new budget being published later this year depending on the composition of our next government.

Privacy and cyber security are often treated separately, but they are intrinsically linked. Enforcing better data management and protection practices across the board should be a priority to help curb the spate of data breaches and ransomware incidents.

There is significantly more room for support from the government for the country’s small businesses, such as those that generate under $3m in revenue yet collectively comprise the majority of this country’s economic fabric. Despite their size, many collect and host large volumes of personal data. There is a strong argument to be made that these organisations need to be held to higher standards through the upcoming privacy regulations, but the reality is that most would require financial support to uplift their digital and security capabilities. This Government’s budget allocates just $60m to support this large cohort of businesses, which feels like it’s probably too small an investment to make a difference to anything beyond awareness.

The main thing that the Government continues to try to wrangle in data security is the balance between innovation and regulation. We have seen consistent and significant data breaches within Australian organisations in recent years, and the past six months have brought a major shift in global thinking around both security and regulation. Combined, these factors mean that the challenge of balancing innovation and data protection – and its urgency – has only grown.

Jason Murrell
Australian Cyber Network Chair

Following up on my original 2030 Strategy budget breakdown post, as we head into another election cycle, the national conversation is dominated by 'cost of living' pressures. Fair enough!

But there’s a quieter economic risk flying under the radar... cyber security vulnerabilities across Australia’s 2.5+ million small and medium-sized businesses (SMBs).

According to the ACSC’s 2023–24 Cyber Threat Report

• Small businesses lost an average of $49,600 per cyber incident (up eight per cent)
• Medium businesses lost $88,000 on average (up 14 per cent)

Even if one per cent of SMBs are targeted, the annual damage exceeds $1.2 billion. That’s not hypothetical... it’s happening right now! Despite the direction set by the 2030 Cyber Strategy, we’re still lacking:

• A funded, nationwide 'Cyber Business Health Check'
• Clarity on execution
• Support that meets businesses where they are

This is exactly where the Dynamic Standards International (DSI) SMB1001 a practical, industry built standard that can fill this gap immediately. It offers a scalable way to assess and improve SMB cyber maturity, without red tape.

The framework is here – what’s missing is national backing and budget allocation.

David Irecki
CTO and Director of Solution Consulting for APJ at Boomi

While it’s no surprise this year’s Federal Budget prioritised cost-of-living relief and core infrastructure, it’s important Australian government and industry continue to invest in AI, digital skills, and emerging technologies. Over the past twelve months, we’ve seen meaningful federal discussions around AI guardrails, governance, and digital capability. Just because this year’s Budget didn’t attach a dollar figure to those priorities doesn’t mean the momentum will or should stop.

Now is the time to double down. Australia has the opportunity to build on these existing initiatives and perhaps take cues from our Asia-Pacific neighbours, who are investing heavily in AI talent, workforce upskilling, and cross-sector collaboration, such as the Enterprise Compute Initiative in Singapore, and Japan’s intention to position the nation as “the most AI-friendly country in the world” with AI-Friendly Legislation. These kinds of practical, future-focused moves could see Australia play a role in shaping the technologies that will define our economy, not just adopt them after the fact.

Ben Henshall
General Manager, ANZ at SUSE

This year’s budget focuses on “Building Australia’s future” and core issues like the cost of living and critical infrastructure clearly remain key. That said, when generative AI continues to reshape entire industries and cyber threats are hitting all businesses hard, I’d encourage the Government to continue the work done so far and its collaboration with industry around shaping AI policy and security, so that Australia can stay on the front foot when it comes to these strategic issues.

Today’s disruptive technology could be tomorrow’s foundations for growth. We’re not in the ‘AI is coming’ phase, we’re in the production rollout of it. Open source technology, both as a development model and a way of working, has shown that collaboration and continual iteration of ideas is a proven pathway to innovation – including in AI.

Australian organisations need collaborative, and crucially cost-effective, ways to achieve strategic tech goals. That’s a challenge open source is uniquely placed to solve, with its dynamic ecosystem of grassroots, public and private sector participants. Supporting that innovation through future Budget investment will better position Australia to meet the essential productivity needs of the nation.

Sunita Bose
DIGI Managing Director

The extension of funding to the National Anti-Scam Centre will support ongoing collaboration between government, law enforcement and industry to respond to evolving scam threats.

This continued investment is essential to sustain and expand the multi-sector response that has recently demonstrated positive results in reducing scam losses.

In addition, DIGI welcomes the Government’s allocation of $8.7 million over three years to the Office of the Australian Information Commissioner to strengthen its enforcement capacity, helping ensure privacy protections keep pace with digital innovation and data use.

DIGI and our members remain committed to working with the Government and community stakeholders on the implementation of the Scams Prevention Framework and other regulation to support stronger protections for Australians online.

We encourage the Government to consider a more ambitious investment in the digital economy and Australians’ related capabilities, including through investment in responsible artificial intelligence and nationwide digital literacy and skilling programs. Investments in these areas will be critical to Australia’s future prosperity, competitiveness and enabling people to navigate digital environments safely.

Chris O’Connor
Co-founder of AtomEthics

I recently outlined three priorities necessary for Australia to compete in the global AI race: sovereign infrastructure, capability development, and governance. Unfortunately, Budget 2025 did not allocate meaningful new funding to any of these areas, a decision that will hinder Australia’s ability to capitalise on AI’s economic potential.

The absence of investment in domestic compute infrastructure positions us as consumers rather than creators. It means Australian innovators who want to run large-scale models will face limited control over data and scalability, while reducing our attraction to overseas investors.

The absence of a clear, well-funded capability plan increases the risk of losing top AI talent to markets with stronger support for research and commercialisation.

And the lack of additional governance funding leaves unresolved risks, as seen in recent audits of high-stakes AI deployments.

This budget jeopardises the government’s own ambition to add $600 billion annually to Australia's GDP by 2030 and improve productivity by 50 to 150%. Australia will continue to fall behind other countries, and, in the long term, risk reduced competitiveness, slower productivity gains, and reliance on foreign AI solutions.

This government has acknowledged that start-ups and small Australian businesses face structural barriers that hinder organisations who try to scale up. That’s why it’s so disappointing when, faced with a glaring opportunity to take action, AI ambition seems to have dried up.

Paul Henaghan
Managing Director for Australia and New Zealand, Cohesity

While this year’s budget priorities such as delivering responsible cost-of-living relief, building a stronger economy, and advancing the sustainability agenda are steps in the right direction, the strategy of investing in cyber security holistically is missing from the equation.

Compared to previous years where the government has invested more to help businesses uplift their cyber security and digital capabilities through various programs, this year’s budget does not go far enough to strengthen Australia’s resilience against the rapid growing cyber threats. In the current world of “when” not “if” an organisation is going to suffer from ransomware or other cyber breaches, it is critical to ensure that commercial and public enterprises can recover and get back to business quickly, beyond front door security measures.

It would have been encouraging to see more funding being put forward to support our organisations with modern data security solutions that leverage advanced AI technologies and improved cyber incident response capabilities. This is especially important as public enterprises and businesses forge forward with digital transformation. Additionally, more support for cyber security skills development would help address the ongoing talent shortage, to ensure Australian organisations have the expertise needed to defend against evolving threats and the resiliency to recover and restore operations in a timely manner.

Cyber-criminals are becoming more sophisticated, and without the right investments in proactive cyber resilience capabilities, recovery, and innovation, Australian businesses and government agencies remain at risk. There is no room for complacency and cyber security must be a national priority to safeguard our digital future.