Government uses Budget urgency to pass bill allowing the automation of welfare decisions

Friday, 29 May 2026

Budget 2026 is here and Stuff's political reporters have spent the last three hours poring through the documents for you.

The Government is paving the way for automated decision-making within the social security system.

A bill, which has been making its way through Parliament on Friday, will allow the Ministry of Social Development to approve the use of automated decision-making (ADM) for certain functions.

Social Development Minister Louise Upston has assured opposition MPs that ADM will only be used for simple binary decisions.

But the way the bill is drafted is broad - it would allow ADM for any social assistance programmes and any statutory powers, duties or functions exercised by the Ministry.

The policy change was announced as a Budget 2025 initiative, however it is being passed under urgency as part of the Government’s 2026 budget measures.

Currently, ADM can only be used in limited situations, including re-granting certain benefits after they expire or determining how child support payment information provided by Inland Revenue may affect a person’s benefit.

Green Party social development spokesperson Ricardo Menéndez March said he is concerned that expanding the allowable use of ADM to all of the Ministry’s functions will mean officials could rely on computers for more discretionary decisions.

Officials make discretionary decisions on things like emergency grants and temporary additional support payments.

“No matter what the Govenrment says, if you look at this bill, it is a carte blanche expansion to basically let a robot - a machine - to have power over people’s lives,” he said.

'We have seen where automating welfare decisions leads. Australia's Robodebt scheme destroyed livelihoods, drove people into debt they did not owe, and left thousands without their legal entitlements. There is no reason to repeat that here,“ he said.

Green Party social development spokesperson Ricardo Menéndez March, right.

Robodebt was an automated government scheme implemented in Australia in 2016. It incorrectly demanded welfare recipients pay back benefits due an an incorrect algorithm.

The scheme was ruled illegal by a court in 2019, and ended up the subject of a royal commission inquiry.

Social Development Minister Louise Upston appearing before a select committee in 2025.

The inquiry’s report, published in 2023, described the scheme as a 'costly failure of public administration' with 'extensive, devastating, and continuing' ill-effects.

Speaking to the Bill on Friday, Upston said “it is absolutely not Robodebt”.

“There is nothing [in this Bill] that changes the principles of the welfare state, there is nothing that changes entitlement under the welfare system,” she said.

“This is the next phase in how we use ADM, so that very straightforward decisions and business rules can be automated so that the amazing people who are at the frontline in MSD can actually use their time and expertise to deliver value to the people that they serve.”

She said the Ministry’s ADM standard - which has been in place since 2022 and is reviewed every few years - took into account lessons from Australia’s experience.

Earlier, Scott Simpson MP, speaking on behalf of Upston, told the House the Government expects ADM will be used for simple, rules-based decisions, but human judgement will remain where it is needed.

Clients will be advised of any automatic decisions and will be able to seek review. A section of the bill also requires the Ministry to maintain an ADM standard that addresses concerns like accuracy and reliability, bias and discrimination and fraud.

The Green Party sees if differently.