The big tech fail: Anger at MBIE is justified, but there are more risks for Govt

Saturday, 20 June 2026

Janet Wilson is a regular opinion contributor and a freelance journalist who has also worked in communications, including with the National Party.

OPINION: Anger is a useful tool for politicians ( just ask Winston ) because it can drive a strong narrative and ultimately achieve change; Immigration Minister Erica Stanford’s eviscerating fury during scrutiny week over the more than $32 million loss arising from Immigration NZ’s failed IT upgrade seems to have achieved both.

As management consultant Greg James’ report shows, Immigration NZ’s biometric capability upgrade (BCU) will forever be branded as the kind of bungling failure that’s the epitome of bureaucratic ineptitude.

It started life in 2019 as a procurement project without ministerial sign-off, then morphed into the poorly researched purchase of an off-the-shelf model in 2020 which was found to be ill-suited to the project requirements, but was powered on by relentless passion and millions of taxpayers’ dollars, as go-live dates were extended time and again, until the money-go-round abruptly stopped last November.

On Tuesday Stanford sat next to her beleaguered MBIE CEO, Nick Blakely, and outlined how project staff deliberately withheld information from her and previous ministers, of how some of the advice was “complete fiction”, with “creative accounting” employed to keep costs out of Cabinet oversight.

Read more:

• Watchdog to investigate after $33m immigration tech project collapses, delivering nothing

• Senior team involved in Immigration IT scandal may still be in public service

• Is a public sector this bad at big complicated things really going to thrive with AI?

Stanford’s claims of “deception by omission” has resulted in Public Service Commissioner Sir Brian Roche quickly instigating a review which will not only uncover whether ministers were knowingly misled but also if a culture problem exists in Immigration NZ.

While Stanford’s outrage has justifiably produced results, it’s also potentially dangerous for the minister, given that the project’s unravelling, while only made public this week, came to light in April 2024 after, as James’ report outlines, Stanford refused to push the project’s budget out to $40 million.

She subsequently received a written apology from MBIE’s then-chief executive, Carolyn Tremain, acknowledging serious failings in a briefing on the project which had been provided in March. Stanford then requested a 2023 review which had questioned the project’s poor delivery history, doubted it would deliver and asked if it should continue.

Stanford told The Post this week that she had confronted Tremain at the time of the disclosures and said, “do not underestimate how upset I am about this”. She urged officials to disclose all they knew, to “bring out your dead” but “that didn’t happen”.

If she was furious about the mismanagement in March 2024, why did it take another 20 months to make the decision to end it in December 2025? Or does the buck not stop with the minister?

There are wider implications, too, for this Government in this sorry saga.

While everyone from Roche to Winston Peters to Nicola Willis have spent the week uttering reassurances that this probable deception is the work of a “few bad apples”, it plays into the Government’s plans to slash thousands of jobs from the public service.

Having officials tell the minister that a multi-million dollar IT upgrade was sound and robust when, in fact, its viability was in severe doubt casts shadows on every civil servant and will drive the perception the place is full of oleaginous mandarins practising the dark arts and there should be fewer of them.

The BCU bungle also presents serious questions about whether the implementation of AI will ever be successfully achieved as a key component of those reforms.

Will the Government Digital Delivery Agency be able to provide the kind of oversight that Immigration NZ’s project sorely needed when its political masters have their fortunes fixed on an end-goal that’s unachievable because of time, money or technical issues?

More importantly, MBIE’s failure to oversee the BCU – despite Tremain conducting weekly meetings with NEC, the project’s provider – is part of a litany of failures at MBIE over the years that suggests the Government’s proposal to build more super ministries is a dubious idea.

Because while much of the debate this week has seen ministers from both sides of the aisle inventorying just how difficult Immigration NZ is to work with, the same is true of the uber-ministry it is part of.

From the outset it has always judged itself too big to fail.

A 2014 State Services Commission review, just two years after it was established, found that of 32 reviews areas, 22 needed development and five were weak. The 14 ministers it reported to didn’t know who they could speak with at MBIE, while its policy advice didn’t meet expectations.

Fast forward 10 years and another review, carried out as part of the coalition’s budget savings processes, found that MBIE’s spending had grown 90% since 2017. That review found that Immigration made up a significant proportion of that headcount increase, accounting for 41% of operating expenditure.

The review advised that INZ should be structurally separated from MBIE.

As I’ve previously said, there’s nothing wrong in reducing the country’s 39 departments and ministries but there’s a caveat to that, as MBIE has provided the salutary lesson for these past 14 years.

Because in downsizing government departments there’s a risk the upsized ministries become a law unto themselves, transforming into bloated, unaccountable behemoths.

What looks good on paper in the short-term could have longer-term consequences – a government that set out to reform through cutting ministries and slashing numbers in fact achieves exactly the opposite.

And the alleged deceit and lack of integrity coming from certain quarters of MBIEwill be just the start of more.