Parliament Is Investigating Why SMEs Lag on AI Adoption

Large Australian businesses use AI at roughly twice the rate of small ones — 37 per cent against 19 per cent, on the latest ABS figures. On 20 August 2026, Parliament decided that gap was worth a national inquiry. A new bipartisan Joint Select Committee on Artificial Intelligence will spend the next three months examining, among other things, exactly why small and family businesses are being left behind — and it reports by 30 November.

For an owner-operator, that is an unusual thing to see. The productivity problem the government is now legislating around is, in plain terms, the one sitting in your own admin pile.

The committee was established by resolution of both houses, backed by government and opposition alike — the Coalition initiated it, the government agreed. Its remit is broad: the adequacy of existing laws, copyright, data sovereignty, national security, consumer protection, deepfakes, cyber security. But tucked inside is the line that matters for a trades or professional-services firm — "the rate and depth of AI adoption in Australian businesses, with a particular focus on smaller enterprises," and the barriers preventing them from using AI effectively.

The stakes are national, not abstract. As reported by SmartCompany, Productivity Commissioner Danielle Wood has put the prize at up to 4 per cent of labour productivity over the next decade. This sits alongside Canberra's broader move to legislate national AI standards and stand up an Office of AI. The direction is unmistakable: government now treats slow SME adoption as a productivity problem worth a parliamentary inquiry.

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Here is what the committee will almost certainly conclude, because the data already says it. The tools aren't the blocker. Most small firms already pay for AI they don't use — the assistants now built into Xero and MYOB, the scheduling and quoting features sitting dormant in software you renew every month. The ABS found only about 12 per cent of Australian businesses used AI at all in 2024–25. The gap between 19 per cent for small firms and 37 per cent for large ones isn't a gap in access. It's a gap in know-how — and, increasingly, in the governance to use the tools safely.

The reason not to wait for the November report is in the economics. An OpenAI working paper cited to the committee warns that because early adopters bake AI into how they work, generative AI could widen the productivity gap between the firms that move and the firms that don't. That's the quiet cost of "we'll look at it next year": the competitor down the road who worked it out this year isn't standing still — they're compounding a lead. This is an Admin Leverage problem before it's a technology one. If you're not sure where your own business sits on that curve, see how exposed your trade or practice is.

Two things. If you belong to an industry body — a trade association, a professional institute — the committee is taking submissions, and the barriers you live with (cost, time, trust, the fear of getting compliance wrong) are exactly what it needs on the record; a short submission through your association puts your reality in front of the people writing the rules.

But the more useful move doesn't need Canberra at all. Pick the one workflow where your team loses the most hours — quoting, scheduling, invoicing, reporting — and put AI on that single problem, measured before and after. You don't need a national inquiry to tell you where your admin is leaking. If you'd rather not guess which workflow pays back fastest, a short conversation will point you at it.

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Not sure where your business sits on the AI curve?

The inquiry will take months to report what the data already shows: the firms that start now compound the lead. A short conversation can pinpoint the one workflow where AI pays back fastest for your business. Book a call.