MBIE chief executive Nic Blakeley has rejected the suggestion that the ministry deliberately misled Parliament over the cancelled $35 million Biometric Capability Update (BCU) project. He told the Privileges Committee — the parliamentary body that investigates breaches of Parliament's rules — that the decision not to mention the project's cancellation to a select committee was driven by budget and commercial sensitivities, not a desire to deceive.

Blakeley appeared before the committee on Tuesday evening, chaired by National MP Chris Bishop, to answer questions about why MBIE failed to tell Parliament's Education and Workforce Committee in March that the BCU project had been cancelled. The project, contracted to Japanese technology company NEC, was intended to upgrade Immigration New Zealand's biometric systems — the technology used to identify people through fingerprints, facial images, and similar data. RNZ

In June, Speaker Gerry Brownlee referred MBIE's conduct to the Privileges Committee after Labour's Phil Twyford and the Education and Workforce Committee raised the non-disclosure as a matter of privilege. A matter of privilege is a formal complaint that Parliament's authority or processes have been undermined. The referral followed RNZ reporting by senior journalist Gill Bonnett, who revealed in a 23 June article headlined "Immigration New Zealand head didn't tell select committee $35m IT project had been axed" that the committee had not been informed of the cancellation. RNZ

Blakeley told the committee that MBIE had a genuinely held belief that Budget and commercial sensitivities limited what it could say in a public forum. He said the ministry was still in negotiations with NEC over a final payment at the time of the March committee appearance, which contributed to the decision not to disclose. RNZ

Pressed further, Blakeley acknowledged MBIE got it wrong. He accepted that, in hindsight, the ministry should have taken a different approach, and conceded that MBIE could have requested a secret hearing — where the public is removed from the committee room — to discuss the cancellation privately. That mechanism would have allowed MBIE to brief the committee on sensitive commercial details without exposing active negotiations with NEC. RNZ

Blakeley said the non-disclosure was not an active decision but rather an understanding between himself and then-Immigration New Zealand head Alison McDonald, who has since retired. RNZ

Blakeley has previously apologised to MPs over the matter. Public Service Commissioner Sir Brian Roche has outlined the scope of a broader inquiry into government IT upgrades, which includes the failed MBIE project. RNZ

RNZ also published a follow-up investigation on 21 July, titled "From achievable to unlikely in nine days: Immigration NZ's botched $35m project," which traced the rapid deterioration of the BCU project's viability. RNZ

Following the Privileges Committee hearing, Blakeley refused to answer questions from media. RNZ

The hearing centred on a core obligation of the public service: when agencies appear before select committees, they are expected to be open with Parliament. The Privileges Committee exists to enforce that expectation. The dispute is not about whether the BCU project failed or about the $35 million cost — it is about whether MBIE's silence in March amounted to a contempt of Parliament. Blakeley's defence rests on the difference between a deliberate act of deception and a misjudgment rooted in genuine, if misplaced, concern about commercial confidentiality.

The broader context here is the tension between commercial sensitivity and parliamentary accountability, a recurring problem for agencies managing large, failing procurements. Think of it like a company in contract negotiations being asked to discuss those negotiations in an open meeting — there is a real tension between transparency and protecting the commercial position. Blakeley's concession that MBIE could have used a closed session undercuts the ministry's main justification, since Parliament's rules provide a mechanism precisely for situations where open disclosure is genuinely constrained. The Privileges Committee will need to weigh whether the gap between what MBIE could have said in closed session and what it chose not to say at all amounts to a contempt. The fact that the non-disclosure arose from an informal understanding rather than a documented decision is unlikely to strengthen the ministry's position with the committee, which will also have to consider the precedent set for other agencies navigating similar commercial constraints. With the Public Service Commission's wider IT inquiry running in parallel, the BCU case is being examined on two separate tracks, and the committee's eventual finding will likely shape expectations around how forthcoming public servants must be when projects collapse mid-procurement.