One in three councils are using computer algorithms to help make decisions about benefit claims and other welfare issues, despite evidence emerging that some of the systems are unreliable. Companies including the US credit-rating businesses Experian and TransUnion, as well as the outsourcing specialist Capita and Palantir, a data-mining firm co-founded by the Trump-supporting billionaire Peter Thiel, are selling machine-learning packages to local authorities that are under pressure to save money. A Guardian investigation has established that 140 councils out of 408 have now invested in the software contracts, which can run into millions of pounds, more than double the previous estimates. The systems are being deployed to provide automated guidance on benefit claims, prevent child abuse and allocate school places. But concerns have been raised about privacy and data security, the ability of council officials to understand how some of the systems work, and the difficulty for citizens in challenging automated decisions.

David Spiegelhalter, a former president of the Royal Statistical Society, said: "There is too much hype and mystery surrounding machine learning and …