Deloitte will return part of a $440 000 government contract fee after admitting that generative artificial intelligence was used to produce a report containing multiple factual and citation errors.

The report, commissioned by Australia’s Department of Employment and Workplace Relations, reviewed a welfare compliance system and was published in July 2025. After journalists and academics found non-existent references and: “AI hallucinations,” Deloitte reissued the report with corrections and disclosed its use of Microsoft’s Azure OpenAI GPT-4o tool.

Officials said the report’s findings remain valid despite the errors. However, Labor Party senator Deborah O’Neill criticized Deloitte for relying too heavily on AI, saying the firm has: “a human intelligence problem.” The department confirmed Deloitte will repay the final instalment of its contract once the refund process is complete.