Western Australia seeks Deloitte refund over AI errors

What happened?

The Western Australian government paid Deloitte A$166,000 for a feasibility study on merging three Perth universities: the University of Western Australia, Curtin University and Murdoch University. According to Guardian Australia, the government is now "extremely disappointed" and is seeking expedited cost recovery (The Guardian). The Department of Energy and Economic Diversification has written to the firm.

What was wrong with the report?

• Earlier in October the report was found to contain AI-hallucinated references. The state opposition called it "AI slop".
• The Guardian found that a link to a World Health Organization report carried a ChatGPT metadata tag in its URL, meaning it was sourced directly from the chatbot.
• In the high-cost Curtin and UWA merger scenario, the A$514m and A$145m items add up to A$659m, but the report states A$399m: a A$260m discrepancy.
• In another scenario it gives A$823m instead of A$512m, a A$311m discrepancy.
• It repeatedly calls Curtin by a name the university has not used since 2010.

Deloitte acknowledged in the report that it used generative AI to support research collation, information synthesis and editorial proofing, and earlier called the errors "minor". A government spokesperson said the errors do not affect the modelling or findings, and Deloitte will review and reissue the report. Deloitte did not respond to the Guardian's questions.

Why it matters

This is not the first case: Deloitte previously paid money back to the Australian federal government over an AI-assisted A$440,000 report. Christian Downie, a professor at the Australian National University, says governments need to recalibrate consulting contracts so the right incentives and penalties are in place. If you commission or deliver expert work produced with AI, write AI-use transparency and human checks of references and calculations into the contract.