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Deloitte to Refund Final Payment After AI Errors in A$440,000 Welfare Report

The episode underscores gaps in disclosure and oversight of AI in public-sector consulting.

Overview

  • Australia’s employment department said Deloitte will repay the final instalment under its contract, with the refund details to be published once the transaction is finalised.
  • A corrected version of the Targeted Compliance Framework review was re-uploaded on Friday, removing fabricated citations, fixing footnotes and typographical errors, and adding an AI-use disclosure.
  • Deloitte’s updated appendix says a large language model tool chain using Azure OpenAI GPT-4o on the department’s Azure tenancy assisted with technical analysis.
  • The original report included nonexistent academic references and a fabricated Federal Court quote, issues first highlighted by University of Sydney academic Dr Christopher Rudge and reported by the AFR.
  • DEWR and Deloitte state the review’s substance and recommendations remain unchanged, as politicians including Senator Deborah O’Neill criticize the firm’s quality controls and transparency.