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Deloitte to Partially Refund Government Over AI-Tainted $440,000 Welfare IT Review

DEWR quietly posted a corrected report deleting fake citations, including a bogus court quote.

Overview

  • The Department of Employment and Workplace Relations confirmed Deloitte will repay the final instalment on its $440,000 contract, with details to be released after the transaction is completed.
  • The review examined the targeted compliance framework and welfare penalties IT system, and the department says the recommendations remain unchanged despite corrections.
  • The original July report contained nonexistent academic references and an invented Federal Court quotation, with a revised version uploaded on Friday before a long weekend.
  • Deloitte acknowledged using a generative AI tool chain based on Azure OpenAI GPT‑4o licensed and hosted by DEWR, while asserting the updates do not alter the report’s findings.
  • The quiet reupload and AI reliance have drawn scrutiny from academics and a Labor senator, highlighting transparency and quality-control risks for consultancies using AI in sensitive government work.