An ombudsman’s investigation has determined the New South Wales government’s debt-collection agency broke the law when it used an automated order system to generate garnishee orders for the bank accounts of people with unpaid fines.
NSW ombudsman Paul Miller has found Revenue NSW’s use of artificial intelligence to generate debt-collection notices for unpaid fines between 2016 and 2019 was illegal.
Revenue NSW is the government body responsible for administering and collecting NSW state taxes and fines. It has the power to issue garnishee orders (GO) in order to collect payment from the accounts of people who have defaulted on debt repayments.
What has happened?
The ombudsman’s investigation was instigated back in June of last year after they received numerous complaints related to automated debt generation, similar to the Robodebt scandal that plagued the previous federal government.
Historically, GOs could only be issued by the courts but, since 1998, Revenue NSW has had the power to issue orders without a court’s approval. In the first years of the program, GOs were manually issued to banks by a Revenue NSW staff member.
In 2013, the department began issuing GOs electronically (but still with human oversight) to banks. Then, in 2016, the AI-assisted system was brought in to help the department issue a high volume of GOs each day.
The investigation was focused primarily on whether the use of the automated GO system was legal and a compliant way of exercising the relevant statutory functions (in this case, collecting debts owed to the state) that Revenue NSW was legislated to carry out.
System unlawful
The ombudsman found that between March 2016 and March 2019, the GO system used by Revenue NSW was unlawful and did not comply with the Fines Act.
Changes were made to the automated system, introducing some human oversight, but the ombudsman found it was still flawed even after this.
Between March 2019 and March 2022, the ombudsman says, the GO system was still “wrong”, and that “the GO system did not provide decision-makers with a clear and complete basis for those decisions, and did not clearly and fully record those decisions and evidence the decision-making process.”
In short, the ombudsman said that, despite the introduction of human oversight of the final decision, those decision-makers were using automated information to do so.
Revenue NSW obtained advice from the Solicitor-General that the version of the GO system in place since May 2022 was compliant with the Fines Act.
What does the ombudsman recommend?
While the ombudsman makes no judgement on whether the system should be used, he does recommend some changes to the scheme if it is to continue.
Any fines that are subject to any pending government ‘write-offs’ should not be included in any automated debt notices.
Notices be stopped for anyone with supporting documents on file – no matter what those documents are – as the risk of a “denial of procedural fairness” is too great.
These cases should be either redirected to manual processors or flagged with decision-makers to read and consider before issuing a garnishee order.
Were you the subject of any of these automated garnishee orders? Do you feel the process was fair and transparent? Let us know in the comments section below.
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