AI Risks for Local Councils in Australia
LG Context
Understanding AI Risks in Local Government Operations, or
'Nothing will put the brakes on being able to innovate with AI, than the public distrust caused when risks that could have been managed upstream, are realised.'
Many organisations are scrambling to navigate the rapidly evolving landscape of AI to harness its benefits while mitigating potential risks. Multi-functional, multi-dimensional and complex organisations with massive volumes of data and diversity of services, like Local Councils, are a perfect setting for the deployment of AI technologies.
In recognition of this, it's understandable that people will try and capture every AI opportunity to 'get on the front foot', without having the necessary regard to the types and scale of risks to the organisation and the communities they serve.
The information below, distilled from the EU Artificial Intelligence Act and augmented by ChatGPT 4o, will hopefully give those looking to harness AI opportunities some ideas of the types of risks and how, through some low-level examples, they might be realised in the LG context.
LG AI Risks Breakdown
Bias and Discrimination
Type of AI: Machine Learning Algorithms, Predictive Analytics
Type of Risks: Unfair treatment/inequity, legal exposure, public trust
Specific Risks to Local Councils: AI systems may inadvertently favor certain groups over others based on data biases. This can lead to unfair resource allocation, discriminatory policies, reputational issues and legal/discriminatory exposures.
Specific Examples Relevant to Local Councils: An AI system used to allocate public housing might give preference to certain demographics based on Council data, disadvantaging others.
Privacy
Type of AI: Facial Recognition, Data Analytics
Type of Risks: Unauthorised data access/release, breach of privacy rules, public reaction, reputational
Specific Risks to Local Councils: AI systems could collect and misuse personal data of residents without their consent, leading to privacy breaches, creating legal exposure and compliance issues.
Specific Examples Relevant to Local Councils: Using facial recognition in public spaces without clear consent could lead to privacy violations and loss of public trust.
Transparency and Accountability
Type of AI: Automated Decision-Making Systems (ADMs)
Type of Risks: Lack of clarity in decision processes, difficulty in attributing responsibility and identifying/establishing accountability
Specific Risks to Local Councils: Decisions made by AI systems may be opaque, making it hard to understand how and why a particular decision was made, leading to accountability risks and mistrust.
Specific Examples Relevant to Local Councils: An AI system deciding on grant approvals may not provide clear reasons for rejection, causing frustration for applicants and consuming more time in managing appeals and customer experiences.
Security Vulnerabilities
Type of AI: Networked AI Systems, IoT Devices
Type of Risks: Hacking, data breaches, service disruptions, compliance
Specific Risks to Local Councils: AI systems connected to the internet could be hacked, leading to data breaches, manipulation of council operations, and disruptions in service delivery across multiple, critical areas.
Specific Examples Relevant to Local Councils: Hackers could exploit vulnerabilities in AI-driven traffic management systems, causing traffic chaos and public safety risks.
Job Displacement
Type of AI: Automation, Robotics
Type of Risks: Job losses, workforce displacement, economic impact, employee well-being, job security
Specific Risks to Local Councils: Automation of routine tasks could impact FTE requirements, creating new, unexplored and unpredictable economic, social and industrial challenges.
Specific Examples Relevant to Local Councils: Automated customer service systems replacing human operators in council call centers.
Reliability and Dependability
Type of AI: Autonomous Systems, Predictive Maintenance AI
Type of Risks: System failures, inaccurate predictions/forecasts, operational disruptions
Specific Risks to Local Councils: AI systems might fail or provide inaccurate predictions, leading to operational disruptions and inefficiencies.
Specific Examples Relevant to Local Councils: An AI system predicting maintenance needs for public infrastructure might fail to identify issues, leading to unexpected breakdowns, repair costs and increased complaints and claims.
Ethical Concerns
Type of AI: AI in Decision-Making, Autonomous Systems
Type of Risks: Unethical decisions, public distrust, ethical dilemmas, reputational
Specific Risks to Local Councils: AI systems making decisions that conflict with ethical standards, laws/legislation/regulations or public values can lead to public distrust and ethical dilemmas for council.
Specific Examples Relevant to Local Councils: An AI system deciding on budget cuts may prioritise cost-saving over essential public services, leading to ethical concerns and adverse public reaction.