Sir Tim Berners-Lee said that while it was important to fight serious organised crime and for a state to defend itself against cyber attack, there were enormous negatives associated with excessive government oversight of digital activity.

He believes that stored information is so dangerous, it can be likened to dynamite.

''The whole thing seems to me fraught with massive dangers and I don't think it's a good idea," he said in reply to a question about the Australian government's data retention plan.

Sir Tim was speaking in Sydney at the launch of the CSIRO's $40 million Digital Productivity and Services Flagship, a research facility focused on the digital economy and exploiting the full potential of the National Broadband Network.

Under the data retention proposal, internet service providers and telecommunication operators would be required to capture the online data of all Australians and store it for up to two years.

''That [stored] information is so dangerous, you have to think of it as dynamite," he said.

He said while it was possible for a government to set up a watchdog to ensure that the stored information was not used, he was not yet aware of any government that had successfully introduced such a system.

During his hour-long talk Sir Tim also raised a red flag about web filtering.

"I have a worry that a government is liable to take too much control; maybe to spy, maybe to block," he said. "So beware of a government that has the ability to control what you see on the web."

His comments were made at the same event where Communication Minister Stephen Conroy, the architect of a controversial web filtering plan, had spoken earlier. The plan was officially put on the back burner late last year.

The CSIRO centre will assist the public and private sectors to develop and deliver more efficient and innovative digitally enhanced services by harnessing data.