Department of Social Services secretary Michael Lye said AI was being used to help make "faster decisions" on redress claims from victims of institutional sexual abuse.
Mr Lye told a senate committee that confirming "situational information" like the dates at which someone was at an institution, and whether a known offender was also there, could be sped up.
"The opportunity with AI means we can potentially reduce manual effort.
"We want staff to focus more on working with our frontier organisations in terms of impact," he said.
Social Services staff were still involved in reviewing all decisions made by AI, Mr Lyle said. Information about the process was outlined on the department's website.
The National Redress Scheme started in 2018 and will run for a decade, following recommendations from the Royal Commission into Institutional Responses to Child Sexual Abuse. Almost 64,000 applications had been made by the end of last financial year.
Institutions, like churches, sports clubs and orphanages, must sign up to the scheme to provide redress that they are liable for. The scheme is expected to exceed $5 billion.
The Australian National Audit Office in November recommended that Social Services find a fast way for processing claims, after survivors were left to wait an average of 16 months for their applications to be processed.
AI use in government agencies has grown significantly in recent years, with 56 entities reported to have used it in 2023/24, up from 36 the year before.
Separately, Greens Senator Larissa Waters accused the department of not having adequate data on how many women and children were at risk of sexual assault and family violence.
More is expected on this topic throughout Thursday.
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