Malcolm Turnbull says the federal government has put $26 million into the University of NSW project to build the world's first practical quantum computer because the government is determined the "enormously valuable" technology should stay in Australia. 
"This is absolutely cutting-edge technology. This is among the most exciting work being done in computing science anywhere in the world," the Prime Minister told a Knowledge Society lunch in Sydney on Thursday.
The government investment in the project, whose silicon-based quantum computing technology is world leading, was announced in last Monday's innovation statement. Telstra and the Commonwealth Bank followed up by offering $10 million each in addition to the government funding.
Mr Turnbull said he was "thrilled" that they had joined the government in supporting the research.
"This could be an enormously valuable technology. The intellectual property, the spin-offs, that will come out of that are so enormously important in so many fields," he said.
The Australia research group based at the University of NSW is in a global race to build the first practical quantum computer that can be commercialised. If quantum computers are successful they could run millions of times faster than the best of today's computers and revolutionise digital technology.
Industry, Innovation and Science Minister Christopher Pyne, who also spoke at the lunch, said quantum computing could be worth billions of dollars to Australia.
Mr Pyne said that now the innovation measures had been announced, delivering them successfully was the "next big challenge".
The government will be bringing in talent to manage the implementation of the measures. Mr Pyne said the recently retired former Prime Minister's Department head Ian Watt would be returning to head the interdepartmental committee in charge of co-ordinating implementation.
In his speech, Mr Turnbull also warned universities their future is at risk if they don't focus more of their research on business needs and valuable new innovation. He said he had a new motto for academics who have traditionally seen publishing more academic papers as their path to winning promotion and boosting research funding
"Publish or perish will be complemented, if not entirely replaced, by 'collaborate or crumble'. You've got to do both," Mr Turnbull said.
He also said that reversing the alarming drift away from STEM subjects in schools - science, technology, engineering and maths - was a key part of the government's innovation agenda.
"There are some very troubling trends that need to be arrested and reversed. A generation ago, 94 per cent of students doing year 12 did science. Today its only 50 per cent," he said.
"That makes no sense at all. Here we are in the digital age, with quantitative skills more important than ever, and students are going in the other direction."