Accountability

'Participatory Accountability at the Dawn of Artificial Intelligence' (King's College London Law School Research Paper No. 2019-31) by Perry Keller comments

 In making a myriad things more efficient and convenient, advanced data analytics are also opening our lives to unjustifiable biases and unseen manipulations. It is, however, less often considered that algorithmic decision making is also progressively changing the nature of liberal democratic forms of governance. In particular, they are rendering direct public participation in transparency and accountability mechanisms unsustainable. In this paper, I address that question in three steps. 

First, using the idea of participatory accountability, the paper explains the importance of information access rights to public engagement in governance. Outwardly, these rights are dispersed across distinctively different fields of law, including freedom of information, data protection and litigation laws and procedures. Yet, in practice, they not only share similarities in design and application, but also benefit from a contemporary political ethos that celebrates public knowledge and scrutiny of authority and power. Their impact on liberal democratic governance, moreover, often lies in their mass and random power to force the disclosure of information. Participatory accountability in the United Kingdom, however, is largely focused on these transparency tools, leaving citizens to pursue accountability as they see fit through diverse processes of litigation, judicial review, regulatory complaint or media publicity.

Second, the paper turns to the complexity and opacity of data analytics and the challenge this poses for direct public participation in algorithmic governance. This challenge goes well beyond a lack of technical expertise in the general public. Deliberately restricted by design and doctrine to limit compliance burdens and disclosure risks, public information access rights cannot be used to compel controllers of algorithmic decision making to provide systemic explanations of their data sources, purposes and outputs. In short, participatory accountability is under-equipped for the future and is, consequently, losing its force and direction. Solutions will, furthermore, need to be as transformational as the societal consequences of data analytics. The answer does not, however, lie in enhanced access rights enabling the public to demand systemic explanations at will. The compliance and disclosure harms of that mass empowerment would undoubtedly outweigh its public transparency benefits.

Third, the paper proposes workable solutions that avoid both the harms of mass empowerment and the alternative of remote and paternalist forms of algorithmic governance. Taking inspiration from the European Court of Human Rights judgement in Magyar Helsinki Bizottság v. Hungary recognising an ECHR Article 10 derivative information access right, I argue that enhanced public access rights, including a power to compel systemic explanations of algorithmic decision making, should be recognised for qualifying media and societal watchdog organisations and individuals.

In addition, where full public transparency is not possible, regulatory and self-regulatory mechanisms should be opened up to greater public participation, in particular for such watchdog organisations. As trusted intermediaries representing the public interest, statutory regulators should, in particular, resist the current rationales of paternalism in algorithmic governance. Relaxation of legal barriers to direct public agency in accountability processes, as exemplified by the Court of Appeal’s recent judgement in Lloyd v Google regarding representative actions, should also be pursued. While a cautious approach to enhanced litigation rights is understandable, more flexibility in representative actions will be necessary as data analytics move beyond the knowledge and resources of the average citizen or consumer and the assistance of better equipped watchdog organisations becomes essential.

'What causes employees to whistle while they work? Factors affecting internal whistle‐blowing in the Australian Public Service' by Jeannette Taylor in (2019) Australian Journal of Public Administration comments

What causes employees in the Australian Public Service (APS) to internally blow the whistle on corruption in the workplace? This research examines the impact of the nature of corruption, organisational culture, and employees’ work attitudes and actions on internal whistle‐blowing in the APS. The respondents were found to internally blow the whistle for most types of corruption: fraud, conflict of interest, unlawful disclosure of government information, and perverting the course of justice. Their whistle‐blowing behaviour was, however, unaffected by observations of theft of official assets. They were also unlikely to report observations of cronyism and nepotism. Active observers of workplace bullying (those who have blown the whistle after witnessing someone else being bullied) were three times more likely to also internally report corruption than inactive observers of bullying.

 Taylor states

 What causes employees in the Australian Public Service (APS) to internally blow the whistle on corruption in the workplace? What types of corruption are they more or less likely to internally report in the APS? What types of organisational culture encourage or discourage internal whistle‐blowing? And what work attitudes and behaviours are significantly associated with internal whistle‐blowing? For example, are whistle‐blowers in the APS disgruntled employees or are they satisfied, committed, and productive employees? It is the aim of this research to address these questions. 

In the process, this research addresses several gaps in the whistle‐blowing literature and corruption issues in the Australian public sector. First, although corruption is multifaceted, most whistle‐blowing research has adopted a unidimensional approach to examine it (Andersson, 2017). There have been few studies conducted on whistle‐blowing by type of corruption, particularly in the public sector and in a non‐U.S. setting (Caillier, 2017; Near, Rehg, Van Scotter, & Miceli, 2004). In addition, although whistle‐blowing studies by type of corruption have included fraud and other forms of corruption, most have failed to include cronyism and nepotism, two examples of corruption related to favouritism (Graycar & Prenzler, 2013). Yet, cronyism and nepotism are the most prevalent forms of corruption in the Australian federal and state public sectors (APSC, 2018; CCC, 2017; IBAC, 2017; ICAC and OPI, 2018). This research examines the impact of different types of corruption, from fraud to cronyism on internal whistle‐blowing in the APS, particularly comparing nepotism and cronyism with other forms of corruption. 

Second, several investigations of corruption cases in the Australian public sector have pointed to the organisation's culture (e.g. CCC, 2017; IBAC, 2017). Public sector studies examining the relationship between organisational culture and whistle‐blowing are, however, rare (Lavena, 2016; Rothwell & Baldwin, 2006). The few studies of culture on whistle‐blowing have also produced inconclusive findings. It is timely to examine the effects of different types of organisational culture on internal whistle‐blowing in the APS. 

Third, despite earlier research indicating that whistle‐blowers are not disloyal or dissatisfied employees (Miceli & Near, 1988), negative stereotypes of whistle‐blowers continue to persist in the workplace (Wortley, Cassematis, & Donkin, 2008). This issue highlights the value of more research across various contexts, such as in the APS. As we gain more understanding about the characteristics of whistle‐blowers through more empirical evidence across different contexts, we can finally put to rest any misperceptions about whistle‐blowers. Further, although research on whistle‐blowing has identified various personal and situational antecedents (Miceli & Near, 2005; Trevino & Youngblood, 1990; van der Wal, Graycar, & Kelly, 2016), they have not examined the effects of work behaviours on whistle‐blowing behaviour. This research examines whether employees who report about the occurrence of one type of wrongdoing in the workplace (witnessing someone else being bullied) are more likely to report about the occurrence of another type of wrongdoing in the workplace (witnessing someone else engaging in corruption). This article starts by defining workplace corruption and whistle‐blowing. It also discusses the significance of internal whistle‐blowing as a control mechanism against workplace corruption.

Datafication

'From Data Politics to the Contentious Politics of Data' by Davide Beraldo and Stefania Milan comments

 This article approaches the paradigm shift of datafication from the perspective of civil society. Looking at how individuals and groups engage with datafication, it complements the notion of “data politics” by exploring what we call the “contentious politics of data”. By contentious politics of data we indicate the bottom-up, transformative initiatives interfering with and/or hijacking dominant processes of datafication, contesting existing power relations or re-appropriating data practices and infrastructure for purposes distinct from the intended. Said contentious politics of data is articulated in an array of practices of data activism taking a critical stance towards datafication. In data activism, data as mediators take a central role, both as part of an action repertoire or as objects of struggle in their own right. Leveraging social movement studies and science and technology studies, this theoretical essay argues that data activism can be mapped along two analytical dimensions: “data as stakes” (as issues and/or objects of political struggle in their own right) vs. “data as repertoires” (or modular tools for political struggle), and “individual practice vs. collective action”. Mapping action repertoires and tactics along these axes allows us to chart the potential emergence of a political (contentious) data subject at the intersection of these two dimensions. This furthers our understanding of people’s engagement with data in relation to other forms of activism and existing work in social movement studies. It also helps us interpreting potential trajectories of contemporary social movements, as they increasingly interface with data, devices and platforms. 

 'Acting on Data(fication)' by Stefania Milan in Stephansen and E. Treré (eds.) Citizen Media and Practice: Currents, Connections, Challenges (Routledge, 2019) 212 comments

The ongoing process of datafication represents a fundamental paradigm shift in the way we conceive of citizenship and civic life. People increasingly engage in forms of civic engagement that interrogate such paradigm shift. These innovative instances of collective action acting on data(fication) can be seen as manifestations of data activism, including, e.g., affirmative engagement with data as well as resistance to massive surveillance. Such practices are rooted on data and software, and involve both individuals and groups, moving beyond the expert niche of hackers to embrace broader publics. Dialoguing with the sociology of social movements, media studies, and critical data studies, this essay explores grassroots data politics seen as data practices emerging around data infrastructure. It illustrates tactics, technical identities, and the relation between software and the prefigurative politics of data activists. It analyses how we ought to adapt our understanding of media practice to capture contemporary changes in the nature of technology and information, broadening our understanding of ‘acting on’ datafication by grounding it on software and a novel understanding of information. It concludes by reflecting on the notion of ‘data assemblages’ as a fruitful addition to our interpretation of (media) practice in the age of datafication.

Responsibility

The unsuccessful appeal by James Peters in Peters v The Queen [No 2] [2019] VSCA 292 offered a novel and unpersuasive argument regarding harm by a medical practitioner.

The Court states

1 The applicant James Peters was an anaesthetist who between March 2006 and 7 December 2009 carried out anaesthetic procedures at Croydon Day Surgery. In 1997 he was diagnosed with hepatitis C. Despite knowing of his infection, between 6 June 2008 and 20 November 2009 the applicant repeatedly stole syringes of the drug fentanyl from the operating theatre, took them to a private place, injected himself and then re-used the same syringe on a patient. 

2 As a consequence of this conduct, 55 of the applicant’s patients were infected with hepatitis C. Of those patients, about eight to ten tested positive for hepatitis C antibodies but negative for the virus itself, meaning that by the time of testing they had ‘cleared’ the virus with which they had been infected. 

3 After a plea of guilty, the applicant was sentenced by a judge in the Trial Division on 7 March 2013 to a total effective term of 14 years’ imprisonment on 55 charges of negligently causing serious injury contrary to s 24 of the Crimes Act 1958. He was sentenced to five years’ imprisonment on each charge, with two months of each sentence other than the base sentence being cumulated. A non-parole period of ten years was fixed. 

4 The applicant made an unsuccessful application for leave to appeal against sentence in 2013.[1] He now seeks an extension of time within which to make an application for leave to appeal against conviction, relying on two proposed grounds. The first proposed ground is that certain of the convictions are ‘unsafe and unsupported by the evidence’, including because infection with hepatitis C virus, without more, did not constitute a ‘serious injury’ for the purposes of s 24. The second is that there is fresh evidence which gives rise to a reasonable possibility that a miscarriage of justice has occurred. The fresh evidence is said to be that new treatment options for hepatitis C have become available with close to a 100 per cent success rate, meaning that people infected with the hepatitis C virus who take the new medications will not develop long term injurious symptoms. It is said that the applicant would not have entered guilty pleas to several of the charges if this evidence had been available at the time. 

5 The applicant seeks leave to appeal out of time. He seeks that extension on the basis that the fresh evidence on which he relies was not available at the time of his conviction or within the appeal period. It is said that the fresh evidence only became available as a result of recent advances in medical science and changes in government policy. The applicant also submits that he was not able to engage new legal representatives until 2017 when he was offered pro bono representation. In an affidavit sworn in support of the application for an extension of time, he states that his understanding at the time of the plea was that infection was deemed a serious injury. He became aware of new treatments for hepatitis C in ‘late 2015 or early 2016’ when a brochure was distributed to him in prison and he personally underwent treatment. The applicant states that he made ‘numerous’ attempts to secure legal representation since becoming aware of the new treatment, but was unable to do so because of his impecuniosity. He states that, since a settlement reached with his victims between November 2014 and April 2015, he has not ‘had control over any assets’. The applicant also says that he is in a dispute with Victoria Legal Aid which has prevented him from obtaining further legal aid for the present application. The affidavit states that the applicant’s current legal representative only came into contact with him, offering pro bono assistance, in March 2017. 

6 The respondent opposes the extension of time application. It is submitted that the applicant’s affidavit does not adequately explain the five year delay and that the proposed grounds of appeal lack merit. The respondent also points to the public interest that the finality of the proceedings is maintained, especially in the present case because of the potential for unnecessary further suffering for the victims.[2] The respondent notes that approximately ten years have passed since the victims were infected, that they were not required to give evidence in the earlier proceedings and they have been making attempts at recovery. 

7 The respondent also contended that the applicant had delayed in bringing the application. He had the services of senior counsel at the committal, on the plea and in the appeal against sentence. He became aware of new treatments in 2015 or early 2016 and obtained the assistance of his current legal representative in March 2017, but the application for an extension of time was not made until 8 June 2018

In R v Peters [2013] VSC 93 the Court stated

1 At 63, you are professionally disgraced, de-registered, socially isolated and facing imprisonment for a large proportion of the rest of your life – perhaps all of it. For what? For succumbing to an addiction that has compromised every aspect of your life. For infecting 55 vulnerable young women who placed their absolute trust in your professional skill and integrity. For giving them a virus from which there is no certain recovery. For placing most of them at risk of developing cirrhosis of the liver and liver cancer. For causing every one of them to suffer significant emotional trauma. Your predicament, and theirs, can be traced to one poisonous tap-root. Your uncontrolled addiction to narcotics, and in particular Fentanyl. That addiction, whilst it undoubtedly explains your offending, does not reduce your moral culpability in any way. 

2 Your counsel, Mr Dickinson SC, correctly submitted that I must not allow the suffering you have caused to overwhelm me. Of course I must consider all sentencing factors, and the consequences of your criminality must take their place with all other factors in the sentence that I impose. 

3 Your addiction to narcotics can be documented back some 18 or more years. As a medical practitioner you issued false prescriptions in late 1994 through to July 1995. Although the reason given initially was that these prescriptions were written to feed your then wife’s narcotics addiction, by December 1995 you advised the Medical Board of Victoria that you had developed an intravenous drug problem relating to your use of both Pethidine and Fentanyl. Both narcotics were used in the practice of anaesthesia – your specialisation. You were dealt with by the Magistrates’ Court in August 1996 where you received a six month suspended gaol sentence. The Medical Board suspended your medical registration for 12 months from May 1996. During this period of suspension you worked as a motorcycle courier. 

4 You remained under the supervision of the Medical Board until February 2010 when your were finally de-registered following the detection of a cluster of Hepatitis C cases traced to the Croydon Day Surgery, and ultimately, to you. In 1997, the Health Department was notified that you were suffering from Hepatitis C, probably contracted from sharing needles with your wife. At no stage, it appears, was your Hepatitis C status ever brought to the attention of the Medical Board, either by you or the Health Department. What is certain, however, is that you knew you were suffering from Hepatitis C. Any measure of your subsequent conduct must take into account both that you knew you carried this virus and, as an anaesthetist, you must have known that this pernicious illness could be transmitted by the mixing of your blood into the bloodstream of another. 

5 You returned to anaesthesia in 1997 under supposedly strict conditions imposed by the Medical Board. In a history given to your psychologist, you asserted that you discontinued opiate use in late 1996, but relapsed in 2003 after the death of your (by then) former wife. This is inconsistent with observations made by a nurse at Box Hill Hospital in 2000 who complained about your apparent appropriation and use of Fentanyl. You were registered to practice as an anaesthetist throughout the period from May 1997 until February 2010, although sporadically you withdrew from practice to deal with either your addiction and/or other health problems. I regard it as clear that from at least 2008 onwards, you were not only addicted to narcotics, but were using them on a regular basis. 

6 You commenced working casually at the Croydon Day Surgery (‘CDS’) in 2004 and then on a regular basis in 2006. Kathleen Ambrosio was responsible for maintaining a sterile environment at CDS. In a statement made to police in October 2010, inter alia, she said the following:

"All the nursing staff were aware Jim had a drug problem... When Jim started back after the throat cancer (late 2006), I remember he was doing daily urine tests. As far as I knew, they were coming back clean. It was probably sometime last year that I noticed a change in Jim... I’m not good with dates... We all knew that Jim was using again... but nothing could be proved and all his tests came back negative as far as I knew..."

It is a matter of singular regret that the very regular urine samples taken from you under Medical Board supervision were never once tested for the presence of Fentanyl or its metabolites, notwithstanding that this was your narcotic of choice and one to which you were exposed on a daily basis. 

7 Between March 2006 and 7 December 2009, you carried out over 3,500 anaesthetic procedures at CDS. 47 patients were ultimately infected with your particular strain of Hepatitis C and a further eight tested positive for Hepatitis C antibodies. All of these patients were infected between June 2008 and November 2009. 

The offending 

8 On 55 occasions you injected yourself with Fentanyl using the same syringe that was subsequently used to supply Fentanyl to your patients. The prosecution summary, amended on this aspect by your counsel, reads as follows: As a medical practitioner and specialist anaesthetist he well knew the risks of transmission by injecting himself with Fentanyl and proceeding to use the syringe for his patients. I accept that you would remove a Fentanyl syringe from the theatre, take it to a private place, attach a needle and inject yourself. On the 55 occasions that are the subject of these proceedings, you must have used the same syringe on your patients. There is simply no other explanation for their infection. 

9 Your counsel maintained, no doubt upon instructions, that you would intend to substitute the used syringe with a clean syringe either with another drug or an inert substance. Mr Dickinson submitted that you did not know that the same syringe was used on any of the 55 relevant occasions. I expressed some incredulity at this proposition which I retain. It is, however, unnecessary for me to resolve that. 

10 By your plea of guilty, you admit that on 55 occasions you were culpably negligent. Your conduct fell so greatly short of the standard of care expected of the reasonable anaesthetist and involved such a high risk of serious injury that punishment under the criminal law is merited. Put simply, the reasonable anaesthetist does not inject himself with a powerful narcotic substance just prior to surgery and he does not, whilst in a narcotically altered mental state, use the same syringe to anaesthetise his patients. If the reasonable anaesthetist suffers from a transmittable illness such as Hepatitis C, he at least advises the Medical Board, his supervisors and his co-workers. I consider your conduct to be truly reprehensible and I view your moral culpability in relation to each offence as very high. This was not a single transitory madness with 55 dreadful consequences. You had been addicted for many years, you knew you had Hepatitis C, and you knew how it could be transmitted to others. You adopted a practice of stealing that drug from your employer, and in the process exposed your patients to great risk, that risk becoming a reality on 55 occasions. You breached the great trust that every patient places in his or her treating doctor. As I have said a few moments ago, your addiction provides an explanation for the criminal negligence you exhibited over 17 months and on 55 occasions. It does nothing to excuse it. 

Medical Board 

11 Both the prosecutor and your counsel made highly critical observations of the Medical Board of Victoria. By and large, these criticisms were justified. The Board relied on your honesty and their urine screening program failed in the way that I have explained. Whatever the failings of the Board may have been, however, you cannot derive much comfort from them from a sentencing perspective. It was you who infected your patients, not the Board. It was you who failed to notify the Board of your Hepatitis C status, it was you who mislead them as to the true state of your addiction, and it was you who made the decision to continue practicing even when you knew that your addiction was hopeless. I do not regard the shortcomings of your supervision as diminishing your moral culpability in any material respect.

RBA Payment Systems Review

From coverage of the 2020 Review of Retail Payments Regulation in today's speech by the Reserve Bank Governor on 'A Payments System for the Digital Economy'

The third and final issue I would like to touch on is the Payments System Board's review of retail payments regulation next year. 

The review is intended to be wide-ranging and to cover all aspects of the retail payments landscape, not just the RBA's existing cards regulation. As the first step in the process, we released an Issues Paper a couple of weeks ago and have asked for submissions by 31 January. There will also be opportunities to meet with RBA staff conducting the review. The review will cover a lot of ground, including hopefully some of the issues that I just mentioned. There are, though, a few other questions I would like to highlight. 

The first is what can be done to reduce further the cost of electronic payments?

Both the Productivity Commission and the Black Economy Taskforce have called for us to examine this question. It is understandable why. As we move to a predominantly electronic world, the cost of electronic payments becomes a bigger issue. The Payments System Board's regulation of interchange fees and the surcharging framework, as well as its efforts to promote competition and encourage least-cost routing, have all helped lower payment costs.

At issue is how we make further progress: what combination of regulation and market forces will best deliver this? Relevant questions here include: whether interchange fees should be lowered further; how best to ensure that merchants can choose the payment rails that give them the best value for money; and whether restrictions relating to no-surcharge rules should be applied to other arrangements, including the buy-now-pay-later schemes.

A second issue is what is the future of the cheque system?

Cheque use in Australia has been in sharp decline for some time. Over the past year, the number of cheques written has fallen by another 19 per cent and the value of cheques written has fallen by more than 30 per cent, as the real estate industry has continued to shift to electronic property settlements (Graph 7). At some point it will be appropriate to wind up the cheque system, and that point is getting closer. Before this happens, though, it is important that alternative payment methods are available for those who rely on cheques. Using the NPP infrastructure for new payment solutions is likely to help here.

Third, is there a case for some rationalisation of Australia's three domestically focused payment schemes, namely BPAY, eftpos and NPPA? A number of industry participants have indicated to us that they face significant and sometimes conflicting investment demands from the three different entities. This raises the question of whether some consolidation or some form of coordination of investment priorities might be in the public interest.

Fourth, and finally, what are the implications for the regulatory framework of technology changes, new entrants and new business models?

The world of payments is moving quickly, with new technologies and new players offering solutions to longstanding problems. At the same time, expectations regarding security, resilience, functionality and privacy are continually rising. Meeting these expectations can be challenging, but doing so is critical to building and maintaining the trust that lies at the heart of effective payment systems. The entry of non-financial firms into the payments market also raises new regulatory issues. As part of the review, it would be good to hear how the regulatory system can best encourage a dynamic and innovative payments system in Australia that fully serves the needs of its customers.

A separate speech states

Our previous review was conducted in 2015/16. Going into that review, the Payments System Board had a few key areas of concern. 

One concern was the introduction of new higher interchange fees. The highest credit interchange rate had risen to 200 basis points and high debit rates were also being introduced. Given the way that the hierarchy of fees was set, these high fees were falling disproportionately on smaller merchants. 

So among the changes that were made to the Bank's standards at the end of the Review, the Bank imposed caps on the highest interchange fees that could be imposed—80 basis points for credit and 20 basis points or 15 cents for debit. As a result, there has been a significant narrowing in the range of fees, and small merchants are less disadvantaged. 

A second concern was the drift above the Bank's interchange benchmarks that could result from the three-yearly compliance cycle. So the changes coming from that review included the introduction of quarterly compliance points. This, plus the narrowing of the interchange fee schedules, has significantly reduced the amount of any drift above the benchmarks. Another concern was the growth in issuance of companion cards and implications for competitive neutrality between three- and four-party schemes. Following the review, the Bank designated the American Express companion card system, and made any interchange-like fees subject to the 50 basis points benchmark. The result has been a more level playing field, and incidentally also a further fall in merchant service fees charged by the three-party systems. 

Finally, we—and many stakeholders—were concerned about excessive surcharging by a small number of merchants. So the review tightened the definition of the cost of acceptance and introduced new measures to improve transparency for merchants – acquirers must now provide merchants with data on monthly and annual costs of acceptance. In addition, the Government gave the ACCC investigation and enforcement powers. Since then, there have been a few enforcement actions by the ACCC and a few high profile merchants – most obviously the two large domestic airlines – have significantly lowered their surcharges. We do not feel that there as many ‘burning issues’ for review on this occasion. However, it is good practice to review regulatory frameworks periodically. Plus, there are a few issues relating to the cost of electronic payments that recent reports from the Black Economy Taskforce and the Productivity Commission have suggested we review. 

While the Review will focus on the Bank's existing standards dealing with card payments, the Board considers it is important that it is holistic and considers how card payments fit within the broader retail payments system. There is a lot happening in payments, and we are likely to see significant change over the next few years, possibly from developments such as ‘stable coins’, expansion of closed-loop systems, other potential sources of disintermediation, and – perhaps more hypothetically – central bank digital currencies. And we are continuing to see a gradual decline in the use of cash in transactions and a sharp fall in the use of cheques. 

Accordingly, it seems appropriate to give stakeholders the opportunity to comment on any broader trends in the payments system that may have relevance for the Review or which should be addressed independently of it. One possibility is that this could point to some gaps in the services that the payments system is providing to end-users, or areas where some collective industry investment might be desirable. If so, it might point to the need for some form of follow-up to the 2010–12 Strategic Review of Innovation, such as the Bank setting a new set of strategic objectives for the industry. One of the broad landscape issues is the possibility of some coordination or consolidation in the three domestically-focused payment schemes or systems; namely BPAY, eftpos and NPPA. Another is the future of the cheque system. 

The Issues Paper then goes on to ask some fairly specific questions on a range of subjects. However, as the Governor noted this morning, many of them relate in one way or other to the question of measures that might be considered to help bring down the cost of electronic payments. 

Accordingly, the Issues Paper devotes a fair bit of attention to least-cost routing and dual-network debit cards. Least-cost routing is intended to give merchants the opportunity to choose their default network for contactless transactions. We have asked for stakeholder views on the experience to date with least-cost routing and whether the Bank should take any additional steps to enhance competition and efficiency. Related to this, we are also asking a question of what options might be considered to enhance competition in the provision of acquiring services to merchants. More broadly, we are also asking for stakeholder views on dual-network debit cards, and the implications of the ongoing shift in card ‘form factors’ away from plastic cards and towards tokenised credentials. 

The Issues Paper also refers to the Productivity Commission's recommendations and asks whether interchange fees should be lowered further. Here, we note that the European Commission has introduced quite low caps – 20 basis points for debit and 30 basis points for credit. It would have be good to already have some hard evidence on the effect of these caps, but unfortunately the EC's study of this has been delayed. 

We have also asked a question as to whether it might be desirable for there to be greater transparency of scheme fees. Scheme fees arrangements are complex and not particularly transparent, and information from some stakeholders suggests that scheme fees on acquirers have been growing over time and are representing an increasing proportion of merchant service fees. 

Finally, we have also asked for stakeholder views on how the surcharging framework for card payments is working, and whether provisions dealing with no-surcharge rules should be applied to other arrangements, including buy-now-pay-later schemes.

Privacy Practice

'Privacy Law's False Promise' by Ari Ezra Waldman in (2020) 97(2) Washington University Law Review comments

Privacy laws have never seemed stronger. New international, national, state, and local laws have been passed with the promise of greater protection for consumers. Courts across the globe are reclaiming the law’s power to limit collection of our data. And yet, our privacy seems more in danger now than ever, with frequent admissions of nefarious data use practices from social media, mobile apps, and e-commerce websites, among others. Why are privacy laws, seemingly more comprehensive than ever, not working to protect our privacy? This Article explains. 

Based on original primary source research — interviews with engineers, privacy professionals, and vendor executives; product demonstrations; webinars, blogs, industry literature; and more — this Article argues that privacy law is failing to deliver its promised protections because it is undergoing a process of legal endogeneity: mere symbols of compliance are standing in for real privacy protections. Toothless trainings, audits, and paper trails, among other symbols, are being confused for actual adherence to privacy law, which has the effect of undermining the promise of greater privacy protection for consumers.

Surveillance Gap

'The Surveillance Gap: The Harms of Extreme Privacy and Data Marginalization' by Michele Gilman and Rebecca Green in (2018) 42 New York University Review of Law and Social Change 253 comments

We live in an age of unprecedented surveillance, enhanced by modern technology, prompting some to suggest that privacy is dead. Previous scholarship suggests that no subset of the population feels this phenomenon more than marginalized communities. Those who rely on public benefits, for example, must turn over personal information and submit to government surveillance far more routinely than wealthier citizens who enjoy greater opportunity to protect their privacy and the ready funds to secure it. This article illuminates the other end of the spectrum, arguing that many individuals who may value government and nonprofit services and legal protections fail to enjoy these benefits because they reside in a “surveillance gap.” These people include undocumented immigrants, day laborers, homeless persons, and people with felony conviction histories suffering collateral consequences of their convictions. Members of these groups often remain outside of the mainstream data flows and institutional attachments necessary to flourish in American society. The harms that surveillance gap residents experience can be severe, such as physical and mental health injuries and lack of economic stability, as well as data marginalization and resulting invisibility to policymakers. In short, having too much privacy can be as injurious as having too little.

The sources of the surveillance gap range from attempts to contain and control marginalized groups to data silos to economic exploitation. This article explores the boundaries of the surveillance gap, evaluates how this emerging concept fits within existing privacy paradigms and theoretical frameworks, and suggests possible solutions to enhance the autonomy and dignity of marginalized people within the surveillance gap.

The authors state

Although we live in a highly surveilled society, some people among us are functionally invisible. For example, low-wage workers — many of whom are undocumented immigrants — toil out of sight in an underground economy. A lack of a conventional paper trail or pay stub system linking workers to employers exposes these workers to potential wage theft and dangerous working conditions. While these workers are perilously out of reach of government and nonprofit organizations that could otherwise provide assistance, they are also subject to heightened forms of surveillance, typically under the increasingly watchful eye of agencies like Immigration and Customs Enforcement. Likewise, homeless persons’ lives are defined by extremes: although they tend to live their lives in public, they are simultaneously governed by laws that criminalize their behavior, steadily pushing them out of view. Tellingly, when former Governor of Virginia Terry McAuliffe sought to restore the ability to vote to constituents who had committed felony crimes, his office was unable to find thousands of people — people who at one point spent time in the prison and parole systems where their
whereabouts were always known to authorities. These examples illustrate that marginalized people experience privacy differently than most Americans. Specifically, they experience privacy extremes—being seen or tracked too much or too little. 

Existing privacy scholarship has largely focused on the harms derived from too little privacy, and, in this vein, several scholars have highlighted the particularly intense surveillance of low-income people. This article examines the other end of the spectrum—the surveillance gap. Life in the surveillance gap can be isolating, stigmatizing, dangerous, and harmful to a person’s physical and mental health. For one, legal protections available to other members of society remain out of reach to those in the surveillance gap. People also lose out on potential sources of economic and social support, because those who seek to provide services to disadvantaged members of our society often find it nearly impossible to reach them. Moreover, those who fall within the surveillance gap are not included within big data streams that ultimately shape public policy, thus leaving out their experiences and needs from the calculus that goes into creating policy. Frustratingly, the challenges facing these groups remain invisible, further. entrenching these groups’ marginalization. 

The surveillance gap has multiple causes, ranging from data silos to poor data sharing, and from benign neglect to administrative systems that purposefully exclude certain people. This article seeks to identify and understand the causes, contours, and consequences of the surveillance gap and to outline legal and policy tools for addressing it. Part II provides case studies of populations living in the surveillance gap, including undocumented immigrants, day laborers, homeless persons, and people with felony conviction histories. Part III situates the surveillance gap within several scholarly streams. First, it assesses the surveillance gap through the lens of scholarship that differentiates between privacy harms experienced by varying groups. Second, it builds on insights from feminist legal theory involving the public/private binary and the harms associated with having too much privacy, wrestling with the tensions identified by feminists between liberalism’s ideals and individuals’ lived realities. Third, it examines notions of “choice” and “consent” in consumer and criminal privacy law, testing whether such frameworks are meaningful with regard to marginalized groups. Fourth, it adds a new dimension to emerging concepts of privacy as contextual. Fifth, it reviews fundamental rights theory’s impact on the surveillance gap, positing that the gap cannot be found in legal regimes that view privacy as a fundamental human right, such as in the European Union. Part IV suggests ways to address harms that arise in the surveillance gap while also respecting desirable forms of privacy and the dignity and autonomy of marginalized persons.

Victorian workers compensation scheme

The Victorian Ombudsman's report WorkSafe 2: Follow-up investigation into the management of complex workers compensation claims offers a disquieting critique.

The report states

1. This investigation looked at the compensation and support provided to people injured at work in Victoria, particularly those with complex injuries. This follows an earlier investigation by the Ombudsman in 2016 which found the scheme had failed some particularly vulnerable people. 

2. Victoria’s workers compensation scheme, also known as ‘WorkCover’, provides a range of entitlements to people who are injured at work under the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic). Entitlements include ‘weekly payments’ for loss of income if they are unable to work and payment of the reasonable costs of medical treatment and other rehabilitative services directly related to their injury.  

3. The scheme is funded by compulsory employer insurance and administered by WorkSafe. WorkSafe is responsible for ensuring appropriate compensation is paid to injured workers, while also maintaining a financially sustainable scheme. 

4. WorkSafe does not manage WorkCover claims itself, instead outsourcing this to five claims agents. The agents are commercial organisations and as a result have a vested interest in the outcome of individual claims. Notwithstanding this, agents are required to stand in the shoes of WorkSafe and make independent decisions on claims in line with the Act. The Ombudsman’s 2016 investigation 

5. In 2016, the Ombudsman investigated WorkSafe and its agents, focussing on agents’ management of ‘complex claims’. These claims involve workers who were unable to work long term and/ or required long term medical treatment. While these claims do not represent the majority, research has shown that these workers are likely to have complex health conditions and represent a substantial and disproportionately high cost to the scheme and broader society. 

6. The investigation found cases of unreasonable decision making on complex claims across all five agents, the evidence of which the Ombudsman said was ‘too strong to be explained away as a few “bad apples’’’. This included numerous examples of agents ‘cherry-picking’ evidence to support a decision, while disregarding overwhelming evidence to the contrary. In many cases, agents were found to defend unreasonable decisions when injured workers disputed them, despite knowing they would likely be overturned. 

7. The investigation acknowledged that as commercial organisations, it was reasonable for the agents to expect to profit from managing WorkCover claims. However, the evidence suggested that in the case of complex claims, financial reward and penalty measures in agents’ contracts with WorkSafe were driving a focus on terminating and rejecting claims to maximise profit, at the expense of sound decision making. 

8. The investigation also identified deficiencies in WorkSafe’s oversight of the scheme, particularly in relation to agent decision making on complex claims.  

9. The Ombudsman made 15 recommendations to WorkSafe which included: • improving WorkSafe’s oversight of complex claims and its use of information from complaints, stakeholder feedback and dispute outcomes to identify potential systemic issues • reviewing the financial reward and penalty measures to increase agents’ focus on quality decisions and sustainable return to work outcomes for injured workers • providing training and additional guidance to agent staff. 

10. The Ombudsman also made two recommendations to the Victorian Government, which WorkSafe said it did not support. These related to the process for injured workers to dispute claim decisions, which involves conciliation and then court. 

Follow-up investigation 

11. While WorkSafe and the agents have implemented many changes since the 2016 investigation, the Ombudsman continues to receive many complaints about WorkSafe and its agents, with nearly 700 complaints received in 2017-18 and about 800 in 2018-19. 

12. In May 2018, the Ombudsman decided to conduct a ‘follow-up’ investigation to examine whether the implementation of the recommendations from the 2016 investigation had improved agent practices and decision making and the effectiveness of WorkSafe’s oversight. 

13. This follow-up investigation concentrated on agent decision making on complex claims in 2017-18, which were primarily long term claims where an injured worker had not worked and had been receiving weekly payments for 130 weeks or more (two and a half years). As at 30 June 2018, these claims represented about a quarter of the 18,519 active weekly payments in the scheme, or about seven per cent of the total 63,085 active claims in the scheme (including those involving medical treatment only). 

14. The investigation involved: • reviewing 102 complex claim files in depth, some of which were randomly selected • reviewing WorkSafe’s handling of complaints received in 2017-18 about agent decisions and Independent Medical Examiners (IMEs), about half of which were randomly selected • meeting with WorkSafe during the investigation and interviewing 16 witnesses, including seven Conciliation Officers and the then Convenor of Medical Panels • reviewing othe rinformation, including a sample of agent staff email records, policies and procedures, research reports, data, written submissions from stakeholders and complaints to the Ombudsman. 

15. The investigation also asked WorkSafe to review a number of decisions on the complex claim files reviewed, which appeared unreasonable but had not been overturned through the dispute process. As a result, WorkSafe and the agents withdrew 30 decisions across 19 claims and back-paid about $70,000 collectively to two injured workers. 

Unreasonable decision making by agents 

16. Although witnesses reported to this investigation a temporary ‘marked change’ in agent behaviour after the Ombudsman’s 2016 report was released, the Ombudsman identified continuing issues with unreasonable agent decision making on complex claims.  

17. The evidence obtained suggests that the Ombudsman’s 2016 recommendations were not enough to change agent behaviour and stop unreasonable decision making on complex claims. After two investigations by the Ombudsman and a number of reviews commissioned by WorkSafe, the evidence points to this being a systemic problem. 

Unreasonable use of evidence 

18. Agents may consider a range of evidence when making claim decisions, including medical reports from IMEs or a worker’s treating doctors; information from an occupational rehabilitation provider; ‘circumstance’ investigation reports and surveillance footage of an injured worker. 

19. Agents are required to adhere to ‘principles of good administrative decision making’, which include that agents must consider all matters relevant to a decision; make decisions supported by the best available evidence; and give ‘proper, genuine and realistic consideration’ to the merits of a decision. 

20. This investigation found that since 2016, agents have continued to unreasonably use evidence to terminate or reject complex claims in some cases by: • conducting surveillance of workers without adequate evidence they were misrepresenting their injury • selectively using IMEs and ‘doctor shopping’, despite new measures introduced to prevent such behaviour • providing incomplete or inaccurate information to IMEs • posingleadingquestionstoIMEsand workers’ treating doctors • relying on an opinion from an IME from the incorrect specialty. 

Unfair return to work practices 

21. A key objective of the workers compensation scheme is to provide ‘effective occupational rehabilitation’ and ‘increase the provision of suitable employment to workers who are injured to enable their early return to work’. 

22. Injured workers have ‘return to work’ obligations, which include that they must make reasonable efforts to return to work and actively use an occupational rehabilitation service. If a worker does not reasonably comply with their obligations, an agent may issue a non-compliance notice, which can impact the worker’s entitlements. 

23. In the sample of complex claims reviewed, this investigation identified several non- compliance notices which had been unreasonably or incorrectly issued. This included cases where: • workers were required to participate in occupational rehabilitation at inappropriate stages of their recovery, such as a case where a worker was experiencing severe psychotic hallucinations  • selectivelyusingevidence,while ignoring other available information – even where the medical opinion relied on was unclear, contradictory or inconclusive • agents failed to genuinely consider workers’ individual circumstances and the reasonableness of their non- participation, including a case where a worker had just been released from hospital after attempting self-harm and had become homeless • agents incorrectly issued notices under the legislation. 

24. The investigation also received evidence that agents sometimes issued non- compliance notices with a focus on liability management. This included evidence from a WorkSafe-commissioned review that occupational rehabilitation consultants perceived in some cases that referrals to their services were ‘not in the interest of the injured worker and were being used as a tool to cut benefits’. 

Agents acting unreasonably during conciliation 

25. This investigation also looked at agents’ actions with respect to claim decisions disputed at conciliation. 

26. When a worker requests conciliation, agents are required to review the disputed decision and withdraw it before conciliation if it would not have a reasonable prospect of success at court (ie not be ‘sustainable’). However, a Conciliation Officer is only able to direct an agent to overturn their decision where there is ‘no arguable case’, which is a lower threshold. 

27. While overall the number of disputes at conciliation has reduced since the Ombudsman’s 2016 investigation, the rate at which decisions are withdrawn or changed through the dispute process remains high. In 2017-18, about half of the decisions disputed at conciliation and 70 per cent of decisions that proceeded to court were varied or overturned. 

28. Although the dispute process should provide a ‘safety net’, the investigation found that unreasonable decisions are slipping through the cracks. Agents continue to defend ‘arguable’ decisions during conciliation, even if they would not be ‘sustainable’ at court, rendering Conciliation Officers hamstrung to resolve such disputes. Conciliation Officers also reported particular difficulties resolving factual disputes. The result is that injured workers are left to contemplate the costly, stressful and time-consuming path to court if they wish to dispute a decision further. Most workers simply give up. 

Decisions contrary to binding Medical Panel opinions 

29. Where a dispute involves a medical question, a Conciliation Officer or court may refer questions to a Medical Panel. A Panel’s opinion must be adopted, applied and accepted as ‘final and conclusive’ by all parties. 

30. WorkSafe told the investigation that where an agent seeks to revisit the same issue considered by a Medical Panel, it expects the agent to demonstrate there has been a ‘material change’ in the worker’s situation since the Panel’s opinion. This may include, for example, improvement in symptoms as a result of further treatment or an increase in the worker’s skills as a result of retraining. 

31. In the complex claims reviewed by this investigation, agents generally waited at least 12 months after a Medical Panel before re-assessing a worker’s capacity. While this is positive, the investigation identified several complex claims where agents terminated workers’ entitlements without sufficient evidence of a ‘material change’ in the worker’s condition since a Medical Panel opinion. 

The effect of financial rewards and penalties on agent decisions 

32. This investigation also revisited the financial rewards and penalties WorkSafe pays agents, based on their performance against key measures. 

33. Since the Ombudsman’s 2016 investigation, WorkSafe has made a number of changes to these, which included reducing the rewards and penalties for terminating claims, and increasing the rewards for quality decisions. 

34. The investigation found limited overt evidence in the complex claim files and sample of agent staff emails reviewed of the financial rewards and penalties influencing agent decisions. However, the investigation received evidence that some agent staff have made efforts to conceal certain behaviours and practices identified by the Ombudsman’s 2016 investigation, including agents’ focus on managing liabilities.  

35. Although less documentary evidence was identified, compared with the 2016 investigation, this investigation still found evidence showing: 36. This evidence, when combined with the extent of unreasonable decision making on complex claims identified by the investigation, raises questions about the suitability of commercial organisations to manage complex claims. 

WorkSafe’s oversight 

37. Although WorkSafe delegates the management of claims to the agents, WorkSafe has a role in overseeing agents to ensure injured workers receive appropriate compensation and are not ‘wrongfully disentitled’. 

38. WorkSafe has made a number of changes to its oversight mechanisms since 2016. However, the investigation found that WorkSafe is still not optimally using them to address unreasonable agent decision making on individual complex claims and to identify and respond to systemic issues. 

39. WorkSafe’s process for auditing the quality of agent decisions has improved since 2016. However, the investigation found that WorkSafe has not always held agents accountable for unsustainable decisions identified through the audits. In its 2017-18 audits, the investigation found instances where WorkSafe: • passed questionable decisions where the agent had only one piece of supporting evidence • re-assessed failed decisions as ‘passes’ when disputed by the agent, even if they would not hold up at court • did not require the agents to overturn most of the failed decisions.   • agents’ continued focus on terminating claims and maximising profit. This included agent staff emails where staff referred to claims which achieved a financial reward as ‘wins’;  • congratulated staff for terminating claims; discussed the monetary value to the agent of terminating individual claims; and referred to targets for terminating claims the influence of the rewards and penalties on agents’ offers at conciliation, which meant that offers were not always informed by the merits of a decision. • 

40. Complaints and stakeholder feedback also offer WorkSafe opportunities to check agents’ performance and identify areas for improvement; however, the investigation found that its role in complaints about agent decisions is unclear. On the one hand, WorkSafe considers agents maintain authority on the vast majority of decisions and that the dispute process is the appropriate mechanism for an injured worker to dispute an agent decision. On the other hand, WorkSafe has the power to direct an agent to change a decision and has established a procedure for when it identifies a worker has been ‘wrongfully disentitled’. 

41. The investigation found that this has led to inconsistent approaches in the way WorkSafe handles complaints, including cases where WorkSafe: • referred workers to conciliation, even though WorkSafe identified concerns with the agent’s decision and could have resolved the complaint itself • accepted agent responses without questioning whether they were correct or reasonable. 

42. WorkSafe appears reluctant to adequately deal with unreasonable agent decision making when it is brought to their attention, which raises the troubling prospect that WorkSafe feels beholden to the agents and dependent on their participation to deliver a financially viable scheme. 

43. Given WorkSafe’s statutory responsibility to ensure appropriate compensation is paid to injured workers ‘in the most socially and economically appropriate manner, as expeditiously as possible’, it must do more. 

Recommendations 

44. Nothing short of wholesale changes to the system will address the issues identified by both the 2016 investigation and the current one. 

45. The Ombudsman therefore recommended the Victorian Government: • commission an independent review of the agent model to determine how and by whom complex claims should be managed • introduce a new dispute resolution process which allows for binding determinations on the merits of claim decisions; is inexpensive; and provides timely outcomes. 

46. The Minister for Workplace Safety, the Honourable Jill Hennessy MP said the Victorian Government accepted both recommendations, stating she was ‘committed to reform’ and ‘disturbed by the findings’ of the investigation. 

47. Given the time it will take to implement these recommendations, the Ombudsman also made 13 recommendations to WorkSafe to address the immediate issues identified by the investigation. This includes a recommendation that WorkSafe establish a dedicated business unit to independently review disputed decisions when requested by workers following unsuccessful conciliation. WorkSafe accepted all 13 recommendations.