WCC not seeking refund from Deloitte after flawed $435,000 report

Report from RNZ by Ellen O’Dwyer
The Wellington City Council won’t be asking for a refund for a $435,000 report which officials have said contains flaws, and which the mayor has described as largely written by AI.

Andrew Little said he stood by his view of the report – and he’s still concerned by it after errors were discovered in August.

The Deloitte Future Fit Pōneke report, commissioned by council chief executive Matt Prosser and released in 2025, claimed the council had 330 more staff than it needed based on the number of full-time employees per 1000 households.

Council staff pointed to errors in the report, including the use of more than three-year-old data on full-time employees from the Taxpayers’ Union, and that duplicate roles were calculated by considering roles with the word ‘project’ in the title were the same. Council officials also said Deloitte had counted all employees as full-time in its calculation of total people costs. They said there was a $21.5 million difference in the council’s figures for total people costs and Deloitte’s.

Officers said the incorrect data meant the assumptions used to come up with the 330 excess staff figure were “inherently flawed” – and a more accurate number was an excess of 284 full-time staff.

This week, a Wellington City Council spokesperson said executives were not seeking a refund for the report.

The report had included a disclaimer that its estimates were indicative and needed further testing before being relied on, the spokesperson said.

“Some aspects of the staffing analysis were identified as requiring further validation, consistent with the report’s disclaimer that additional verification and financial modelling would be needed before relying on the findings.”

Wellington City Council confirmed its decision to cut 47 roles this week, in a drive to save over $4 million – including from the Creative Capital, Economic and Engagement, Planning and Environment and Property and Capital Projects team.

The council spokesperson said job cuts weren’t made solely as a result of the Deloitte report.

The report included recommendations that were being worked on already, including to improve contract management, workforce planning, organisational design and cost efficiency.

The Guardian reported Deloitte provided a partial refund to the Australian government when errors were found in another report it did, also partly written AI.

Little said while it is the council officials’ decision whether or not to seek a refund, he stood by his assessment of the report as containing “large parts drafted by AI”.

“That’s probably a standard these days. What I was concerned about is that too much of the report wasn’t properly tailored to the needs of the Wellington City Council.

“It was effectively off-the-shelf, generic drafting – that continues to concern me.”

Little said he was unsure whether Deloitte’s AI agent referred to out-of-date data, rather than the recent data the council had provided. “That is a matter that is yet to be resolved in my view.”

Deloitte did not answer questions about how the errors came about. However in a statement, a spokesperson said the company stood by its report and recommendations – and was confident it had been useful.

“In respect of AI, Deloitte uses a range of tools and technologies across its work, including AI-enabled tools where appropriate. These tools, where applied, were used to support and speed up aspects of the work process, rather than replace human analysis, judgement, or review.”

The spokesperson said that like all of Deloitte’s work, the report was subject to professional oversight, challenge and quality review.