Outsourcing the Welfare State: The Role of Private Actors in Welfare Fraud Investigations

European Journal of Comparative Law and Governance, Forthcoming

University of Groningen Faculty of Law Research Paper No. 10/2020

48 Pages Posted: 24 Jan 2020 Last revised: 12 Mar 2020

See all articles by Sofia Ranchordas

Sofia Ranchordas

University of Groningen, Faculty of Law; Yale Law School - Information Society Project

Ymre Schuurmans

Leiden University

Date Written: December 31, 2019

Abstract

This article discusses the growing trend to employ private parties as informants, private detectives and providers of digital technology (e.g., automated risk assessments) to predict and investigate welfare fraud. In this article, we argue that this type of outsourcing is problematic for multiple reasons. First, private actors and governments often have an ill-defined contractual relationship which creates legal uncertainty and promotes the use of unconventional evidence-gathering instruments. This issue also raises concerns regarding the accountability of public bodies and the transparency and fairness of administrative procedure. Second, the private enforcement of anti-fraud regulations is susceptible of endangering the adequate pursuit of the public interest due to the misalignment of public and private interests. Third, the outsourcing of enforcement tasks to private technology companies and their opaque automated systems can be detrimental to the right to due process, the right to non-discrimination, and the privacy of welfare recipients. This article contributes to the literature with a novel critical account of how private actors are reshaping the welfare state.

Keywords: privatization; social welfare; algorithmic bias; data-driven decision-making; discrimination; surveillance

JEL Classification: K10

Suggested Citation

Ranchordas, Sofia and Schuurmans, Ymre, Outsourcing the Welfare State: The Role of Private Actors in Welfare Fraud Investigations (December 31, 2019). European Journal of Comparative Law and Governance, Forthcoming, University of Groningen Faculty of Law Research Paper No. 10/2020, Available at SSRN: https://ssrn.com/abstract=3512114 or http://dx.doi.org/10.2139/ssrn.3512114

Sofia Ranchordas (Contact Author)

University of Groningen, Faculty of Law ( email )

Oude Kijk in 't Straat
Harmoniecomplex
9700 AS Groningen, Gn 9712
Netherlands

HOME PAGE: http://www.rug.nl/staff/s.h.ranchordas/

Yale Law School - Information Society Project ( email )

P.O. Box 208215
New Haven, CT 06520-8215
United States

Ymre Schuurmans

Leiden University ( email )

Postbus 9500
Leiden, Zuid Holland 2300 RA
Netherlands

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