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Is this the day of the timid Australian?

By Tim Besley - posted Friday, 18 October 2002

Are Australians more timid, more loath to take risks and consequently, less likely to advance rapidly as a society, than our forebears? On the daily evidence of our national media, it would seem so.

Hardly a day passes without some valued service in the community being withdrawn for lack of insurance cover. Without somebody suing someone over an unforseen risk. And not a day passes without the real risks escalating as a result.

A new report by the Academy of Technological Sciences and Engineering (ATSE) suggests we are in danger of becoming paralysed by fear. Our risk aversion may prove the greatest stumbling block to our social, economic and environmental progress, to our becoming an innovative society.


The implications are serious for the whole community. It is not simply a matter of lawsuits, insurance cover and regulation, though there is clear room for improvement in all areas. It is also a question of how, as a society, we identify, understand, respond to and cope with, risk. At present we do not do this well.

"No pain, no gain" is a common saying of our athletes and sportspeople. "No risk, no progress" might be its equivalent when we come to comprehend and deal with the risks presented by modern technology and innovation.

Despite our best efforts, new technological developments almost always entail a measure of unanticipated risk. The problem is that our present level of risk aversion tends to discourage innovation in Australia by punishing our creators and developers when risks eventuate. If people can be sued and otherwise penalised for trying to improve our national health, wealth and wellbeing, they may think twice about doing so. Or they may simply go and do it in another, less risk-averse, country.

Our efforts to handle risk sensibly are hampered by five paradoxes:

  • Social: we need to take risks to progress, but are becoming more risk averse
  • Legal: risk-taking requires a logical, precise law of negligence, but the current law is illogical and imprecise
  • Regulatory: our regulation is fragmented and inconsistent, it lags behind technology. Our regulators are more exposed legally.
  • Investment: technological progress requires patient risk-capital. Our financial markets cannot provide enough.
  • Disasters: many avoidable disasters occur in spite of clear warnings, even in large and respected organisations.

In the case of the law, former Chief Justice Sir Harry Gibbs points out that judges and the present law of negligence now favour generous handouts to the plaintiff, often at the expense of justice to the defendant. This deters those who provide goods and services to the community from taking otherwise reasonable risks.


In recent years Australia has enjoyed high levels of economic growth by world standards. To sustain these we have to take risks.

And to take risks, we have to be less timid and uncertain, less litigious and less eager to punish those who are adventurous, enterprising or innovative.

For this to happen, however, there must be a fuller dialogue in society about the sort of risks we are prepared to countenance – and the ones we are not. The Academy is calling for major consultation between governments and the community to determine how we can achieve an acceptable risk profile for our society – one that does not hamper progress, but nor does it mean progress as the expense of people’s lives or wellbeing.

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This article was first published in The Australian on 9 September, 2002.

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About the Author

Tim Besley AC, is President of the Australian Academy of Technological Sciences and Engineering.

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