Australian public sector ramps up GenAI amid security, skills gap

Research from Nutanix indicates that the Australian public sector is increasing its use of generative artificial intelligence (GenAI) technologies, but faces challenges related to infrastructure, security, and skills.

According to the Nutanix Public Sector Cloud Index, the majority of Australian public sector organisations are embracing GenAI. The study reports that 94 per cent are already leveraging GenAI workloads, including chatbots and content generation tools, and most expect to see a return on investment within one year.

Despite these advancements, concerns remain about the foundational elements required to successfully deploy GenAI at scale. The report highlights that 92 per cent of respondents say their organisations are not doing enough to secure their GenAI models and associated applications, reflecting a gap between adoption and readiness.

In terms of technical capacity, 76 per cent believe their current IT infrastructure needs moderate to significant improvement to support modern, cloud-native applications. The report suggests this could impact the effectiveness and scalability of GenAI initiatives across the sector.

Capability gap

The findings reveal what Nutanix describes as a 'classic capability gap'. While public sector leaders view GenAI as a route to increasing productivity and automation, the ability to deliver on these outcomes is hindered by legacy technology, fragmented data security, and a need for increased skills development.

Greg O'Connell, Vice President, Federal Sales, Public Sector at Nutanix, said:

"Generative AI is no longer a future concept, it's already transforming how we work. 94 per cent of public sector organisations are already putting AI to work and expect returns in as little as one year. As public sector leaders look to see outcomes, now is the time to invest in AI-ready infrastructure, data security, privacy, and training to ensure long-term success."

One outcome of this environment is that security and privacy are rapidly becoming higher priorities for public sector IT teams. The report states that 96 per cent of respondents agree GenAI is changing organisational priorities, with security and privacy now more prominent than before.

Security concerns

Public sector organisations recognise the need for a more comprehensive approach to data security. The survey emphasises that most leaders believe further steps must be taken to address foundational levels of data governance and security to support effective GenAI deployment.

Nutanix's research suggests that application containerisation is an area where the public sector is making progress, with 96 per cent of respondents saying their organisation is at least in the process of containerising its applications. The adoption of Kubernetes is cited as a key driver behind the acceleration of containerisation across the sector.

Almost all (91 per cent) of survey respondents said they see benefits from adopting cloud-native applications and containers, suggesting that awareness of infrastructure modernisation is high even as gaps remain.

Investment and skills

IT infrastructure investment is ranked as a leading area for improvement by public sector respondents. Many organisations acknowledge that without updating infrastructure, supporting GenAI solutions at scale will remain challenging. The report also notes the need for continued upskilling and hiring to ensure organisations can develop, deploy, and support new GenAI projects and solutions effectively.

The survey was conducted globally by Vanson Bourne in late 2024 and included 1,500 IT and DevOps decision-makers. Respondents were drawn from multiple industries and regions, including Asia-Pacific, the Americas, and EMEA, offering a broad perspective on GenAI adoption in the public sector.

Key findings from the report indicate that GenAI adoption is expected to improve productivity, automation, and efficiency in the public sector, but achieving long-term returns will depend on addressing the existing gaps in security, infrastructure, and skills.