Government computer systems keep failing — and agencies keep making the same mistakes
Two more major government computer projects are in trouble, according to RNZ.
The Ministry of Justice has been working on expanding a system that lets people appear in court by video instead of in person. Treasury gave that project a "red" rating last year, which means it considers the project "appears unachievable". The ministry told RNZ it has revised the project but is still six to eight weeks away from sharing details. An early plan for the project was supposed to be finished by this month.
Internal Affairs has its own problem. The department is trying to replace the computer system New Zealanders use to get birth, death and marriage records. Its first attempt was launched in 2024 and then abandoned, at a cost of $213 million. The department is still in a dispute with the Australian company DWS over that cancelled contract.
A second attempt at replacing the system was reviewed by independent assessors in January, who gave it an amber/red rating — a warning that the project is at risk. The review said the system definitely needs replacing, but more work is needed before ministers can be asked to approve it. Internal Affairs has not yet decided exactly what the replacement should look like and will not present options to Cabinet until next year.
Meanwhile, the government's own digital leaders are telling ministers that government agencies are not changing how they work. The government chief digital officer said agencies keep proposing computer projects that are "siloed" — meaning each agency builds its own system instead of sharing with others. The projects also tend to duplicate work already being done somewhere else, according to the latest available Treasury report for the December 2025 quarter.
The same report said agencies have shown low confidence in their ability to staff these projects with the right expertise for the past 18 months. The chief digital officer told agency heads last year to start pooling resources and following government standards under a Cabinet plan called "Back-Office Transformation". The December 2025 Treasury report shows that message has not yet changed agency behaviour.
Other examples of failed government IT work have already surfaced. MBIE, the country's largest ministry, wasted more than $30 million on a failed biometric system, which led to investigations in Parliament. Te Whatu Ora offered to pay big technology companies thousands of dollars to test failing hospital computer systems in Wellington, then gave a contract to one of those companies, RNZ reported.
The same pattern shows up in infrastructure. RNZ reported last year that the government's fast-track approvals process for major building projects will actually be a "slow track" unless the country fixes its "hotchpotch" of data systems.
A review published last month found that government digital spending is scattered and projects are not being prioritised well. The review described the public sector technology system as poorly informed, poorly coordinated and too focused on process rather than results. It prompted calls for a government digital "reset", according to iStart and Global Government Forum.
New Zealand has also dropped in international rankings. In the OECD's Digital Government Outlook 2026, published in June, New Zealand scored 0.48 out of a possible 1.0, below the OECD average of 0.70, and down 0.02 since 2023, according to the OECD.
The government does have plans to fix this. Its Digitising Government Programme aims to make digital spending more centralised and coordinated. The Strategy for a Digital Public Service calls for agencies to work together on integrated services instead of each running its own separate system.
Part of that strategy involves replacing "legacy systems" — old computer systems that are still in use but are obsolete. Government guidance says technology becomes legacy if it is end-of-life, no longer supported by its supplier, impossible to update, no longer cost-effective, too risky, or losing its usefulness.
These old systems are expensive to maintain — often costing more than replacing them — and they do not work with modern mobile, web and cloud applications or current security standards. Their processes and technical information are frequently undocumented, meaning organisations rely on individual employees remembering how they work. That makes disaster recovery difficult. Older systems also lack security updates, which makes them more vulnerable, and they tend to run slowly and break down more often. The guidance says the first step to fixing the problem is identifying which systems are obsolete and making a plan to move off them.
The government also tells agencies to go to CERT NZ for advice on the risks of legacy systems and how to manage them.
The broader context here is that New Zealand has the right policies on paper. The Plain Language Act 2022 requires government agencies to communicate in plain language. Web Accessibility and Web Usability Standards came into effect on 17 March 2025. The Public Service AI Work Programme sets out a two-year plan for using artificial intelligence to improve public services. But the Treasury report, the independent reviews and the OECD score all point to the same thing: what is actually happening is not keeping up with what the strategy calls for.
Agencies keep proposing projects that copy work already being done elsewhere, lack the staff to deliver them, and in some cases have already cost hundreds of millions of dollars when they fail.
For those working in and around the system, the question is whether the government's coordination programmes can change agency habits before the next round of project failures produces more red ratings and more write-offs. The December 2025 Treasury report gives little evidence of that change so far.
