OpenAI’s experimental models accessed a Services Australia portal hosting Medicare statistics without authorisation, prompting a parliamentary committee to call for independent safety checks and tighter government oversight of AI companies operating in Australia.
Who Sets the Rules
After the breach, the bipartisan committee sent its “early advice” to Prime Minister Anthony Albanese. Its final report is due at the end of November. The federal government hopes to introduce legislation on national standards for data centres and frontier AI models by the end of this year, and parliament is expected to pass the laws in early 2027.
The committee recommended placing independent experts inside leading AI companies. They’d have access to company systems and report safety findings and incidents to the government. Frontier AI labs should also monitor and report incidents in a “timely manner,” with “clear reporting deadlines,” the committee said.
Security agencies, including the Australian Signals Directorate, should receive early access to new models as a condition of allowing frontier AI labs to train them in Australia. Under the proposal, Australian agencies would have a formal role in assessing systems developed by companies seeking to operate locally.
The committee also proposed an ongoing parliamentary joint standing committee to monitor AI and conduct “rapid reviews” of new regulation when needed. It would receive regular reports on serious events, including cyber incidents involving AI, unintended actions by models and agents, and “misuse” of the technology.
The Data and Domestic Capacity
The committee urged the government to immediately review protections across its data repositories, particularly those holding sensitive and national security information. It also recommended monitoring the risk that AI could help develop biological weapons.
OpenAI apologised for the unauthorised access and its response, which included a months-long delay in detecting the incident and notifying the government. The committee said the breach showed the need for “appropriate and robust safeguards” to protect Australian data and the people who own and use it.
The committee backed investment in data centres and national standards covering resource use, additional electricity generation and community consultation. It recommended reserving a share of computing capacity for national security and university research, with health and social services among potential beneficiaries.
Australia shouldn't be “merely a consumer of AI technologies developed elsewhere,” the committee said, but rather “a trusted, competitive and strategically capable participant in the global AI industry.” Industry and Innovation Minister Tim Ayres said the government was working on ways to give Australia more control over AI models by training them domestically, but didn't explain how copyright rules might change to enable that.
Copyright and Australian Content
The committee said current copyright arrangements were “not facilitating” licensing deals for Australian culture and content. The letter said, “The status quo sees the work of Australian artists, musicians and media outlets used overseas without adequate control or payment.”
Frontier AI labs have described existing copyright settings as a “barrier” to training in Australia. The committee recommended examining the rules so Australian creators “retain control over how their works are used, that they are paid, and that AI systems reflect Australian values and culture”.
Australian Recording Industry Association chief executive Annabelle Herd told the inquiry existing licensing systems could support AI training without rewriting copyright protections to suit foreign companies. “They should come to the negotiating table, not to the prime minister’s office,” she said.
The letter was signed Monday night by Labor chair Jo Briskey and Liberal deputy chair Jonno Duniam. OpenAI chief strategy officer Jason Kwon said the company would “support a framework on mandatory disclosures”. Ayres said building capacity across the AI technology stack, from critical metals production to advanced chip components and start-ups, would strengthen supply-chain resilience.