The NSW Digital Restart Fund has led to “fractured thinking” in service design that is opening the possibility of more Robodebt style disasters in public administration, the state’s information and privacy watchdog has warned.
The warning comes after the watchdog reviewed dozens of projects and pitches for funding from the Digital Restart Fund, which was not topped up by the new government and looks set to run out by next year.
The Digital Restart Fund, which at one point was allocated more than $1 billion, is used to fund iterative, multi-disciplinary approaches to planning, designing and developing digital products and services in the state.
It has been a highly praised initiative adopted by other jurisdictions, with a federal version under consideration by the Albanese government.
In a submission to the state parliament’s current inquiry into artificial intelligence, the NSW Information and Privacy Commission said the fund has fostered the “progressive technical thinking” that created arguabley the country’s best digital government services.
But the watchdog — which oversees projects and pitches for funding to mitigate the “risk of the alienation of fundamental human rights” in the fast paced, tech heavy approach — says the fund has also introduced risks.
“These arrangements have also fostered, to some degree, an alienation of the technical from the legal and governance considerations which impact the lives of the citizens served by the NSW public sector notwithstanding the requirement to seek advice from the Information Commissioner and the Privacy Commissioner.
“The risks presented by this fractured thinking are now well ventilated in the Australian political and administrative environment,” the Commissioner said, referencing the Royal Commission into the Robodebt Scheme.
The warning from the state’s Information and Privacy Commission comes after several years of it assessing Digital Restart Fund proposals and active projects.
The requirement to seek advice on data and privacy implications of projects from it was only added through a late amendment in 2020 by the then opposition, just before the enabling legislation was passed.
The Digital Restart Fund has been listed for examination by the state’s Auditor General, which the Information and Privacy Commission said will be published “soon”.
Last year, the Privacy Commissioner Samantha Gavel and Information Commissioner Elizabeth Tydd presented the former government with an ‘AI regulatory scanning report’, that included worlds best practice with several examples of holistic approaches to AI governance.
It also revealed New South Wales had an “inadequate” approach to disclosing the use of algorithms by government and there was a general lack of recognised safeguards for the highly digital state government.
Then-Digital Government minister Victor Dominello said the report was a wake up call, conceding the state was behind the world’s best on AI oversight.
But the Information and Privacy Commission’s recent submission to the AI inquiry says it is “unaware of the status of the options” it presented a year ago.
The submission also recommends the New South Wales Parliament consider adopting the risk based approach to AI regulation with specific criteria and risk thresholds that is being introduced in Europe.
Any regulation should be harmonised with national and global approaches where possible, the Commission said, but the state should at least mandate the completion of a privacy impact assessment as part of a governance framework for the introduction new technologies like AI.
