Udbetaling Danmark welfare payments optimisation prompts controversy

Released: January 2016

Udbetaling Danmark's welfare fraud control system led to leading legal, civil rights and privacy advocates to complain of a privacy and 'surveillance nightmare'.

Created in 2012 to profile unemployed citizens and streamline the payment of welfare benefits, Udbetaling Danmark used fraud control algorithms that can access the personal data of millions of citizens. 

The data network allowed Udbetaling Danmark to automate checks required before benefits are granted, such as verifying income level or wealth. It also allowed the organisation to perform controls after a benefit had been granted to verify that a beneficiary’s situation had not changed.

However, it transpired that Udbetaling Danmark had access to the personal data of citizens who did not receive welfare payments, leading to complaints from legal, civil rights, and privacy advocates, who described the situation as a 'surveillance nightmare’.

The controversy highlighted the challenges and pitfalls of using data and automation in the management of welfare payments.

➕ In 2019, a case related to housing benefits revealed that Udbetaling Danmark’s database held much information about a citizen who was not a beneficiary, leading to a complaint being filed with the Danish Data Protection Authority. 

System 🤖

Operator: Udbetaling Danmark
Developer: The Agency for Labour Market and Recruitment (STAR)

Country: Denmark

Sector: Govt - welfare

Purpose: Optimise welfare payments

Technology:  
Issue: Accuracy/reliability; Privacy; Surveillance

Transparency: 

Page info
Type: Incident
Published: March 2023