South Australian treasurer Stephen Mullighan announces new $28m AI program in state budget

The coming AI tidal wave is beginning to hit into Australia’s public sector, with the South Australian government announcing a new $28m program to embed the technological revolution into policing, healthcare, finance and law.

Treasurer Stephen Mullighan delivered the surprise allocation in the state’s 2025-26 budget, with the funding designed to “maximise on the benefits and promote growing the use of AI applications across the South Australian public sector”.

The budget measures claim the program will initially prioritise policing and healthcare with a set of “proof of value trials”.

“Through targeted proof of value trials in priority areas such as health care and policing, this funding will provide support for broad applications across government and allow multiple use cases to be developed on trusted foundational technologies, with appropriate governance and alignment to the investment principles of the digital investment fund,” the document says.

“The health sector is a priority for funding consideration, as global evidence shows that integrating AI in specific areas of healthcare can reduce costs and improve operational efficiency, allowing healthcare professionals to spend more time on clinical care.”

In policing, the program will look to enhance efficiency and safety for officers.

“AI can be used to support real-time decision making to help allocate resources effectively, increase officer and public safety and reduce administrative burden on officers, freeing up time for more value-added work,” the document states.

“Other areas considered for priority funding may include allied health, social work and legal and financial areas of the public sector.”

The program, which sits within the government’s broader digital investment fund, is funded from 2025-26 through to 2028-29, with an estimated $4.6m in yearly operating expenses and $2.4m in yearly investing expenses.

It is expected to create five new ongoing full time jobs over the period.

Australian Institute of Machine Learning institute manager Dr Kathy Nicholson said the government’s AI push was not about replacing public servants.

“What this program is really about is upskilling and adopting AI into government service,” she said.

“We all know how overworked everyone is. There are so many repetitive processes in so many jobs and areas and the intention of this funding is in the first instance to look at healthcare, policing, and some of those pain points in government areas and look at ways they can test AI systems to create efficiencies.

“My understanding is they are doing this in a slow, methodical way to make sure there are good guardrails in place.”

Dr Nicholson said without AI efficiency drives, government budgets could “blow out”.

“Everyone, be they public servants, or be they non public servants, is going to have to learn how to use AI to be more efficient in their work,” she said.

“This is just about upskilling, creating the tools so that everybody can use them, and bringing the public service along on a journey that is happening.

“If they don’t adopt it in the public service, what we are going to see will be blow outs in budgets.”

Nationwide, multiple jurisdictions are grappling with the promise and peril of AI.

In February this year, Queensland Information Commissioner Joanne Kummrow warned taking a “wait and see” approach to AI risked the public sector “falling behind understanding and responsibly engaging with its capabilities and challenges”.

“While AI shows promise as a powerful tool capable of delivering improved public services, agencies need to take the ‘right path’ by mitigating privacy and security risks and ensuring its ethical and transparent use, rather than taking the ‘fast lane’ without due regard to the necessary guard rails and protection of citizens’ personal information,” she posted to the website of the Office of the Information Commissioner.

The NSW government, meanwhile, funnelled more than $2.7m in grants to 16 councils in mid 2024 to trial AI in local planning systems.

The trials were designed to “improve the development application process for all users, including homeowners, councils and developers”.

Outside of government, South Australia will also deploy AI to develop a fuller picture of its mineral wealth, with a particular focus on copper production in the giant Gawler Craton, which sprawls across the central portion of the state.