Immigration Minister Erica Stanford is not known for theatrical outbursts, which makes her characterisation of officials’ conduct all the more striking. She called the behaviour “deliberate and co-ordinated” and described the advice she received as “complete fiction”. She is talking about her own ministry.
The Biometric Capability Upgrade project ran from November 2018 to November 2024 and produced zero measurable benefits. It cycled through roughly a dozen project managers, pivoted strategy without due diligence, and burned through tens of millions in public money. That alone would be a bad day for MBIE. What makes it a governance crisis is what happened to the numbers.
Creative accounting to dodge Cabinet
Cabinet rules require sign-off when a project’s costs exceed $35 million. The independent review by Greg James found that “creative accounting practices had been undertaken to keep costs of the project below Cabinet’s mandated limit”. By autumn 2024, costs had reached $39.9 million, then mysteriously appeared to decrease in project records with no documentation explaining the change. A further $4.44 million was transferred out of the project between 2022 and 2025.
The original whole-of-life cost was $19 million. Stanford noted it rose to $35 million “with almost as far as I can tell no questions asked.” When MBIE sent her a briefing in March 2024 seeking approval to lift the cap to nearly $40 million, the review found that advice was incorrect and misleading. The most recent assurance review had reached close to the opposite conclusion, doubting whether the project would deliver at all.
This is not bureaucratic incompetence. This is officials engineering the paperwork to avoid the one mechanism designed to catch exactly this kind of blowout.
Two months sitting on the bad news
The independent review was completed two months before it reached Stanford. MBIE chief executive Nic Blakeley said the ministry wanted to include its response alongside the report. Stanford’s reply was blunt: “There was no response provided.”
Blakeley has acknowledged that “MBIE’s decisions, oversight and governance failings led to the project’s overall failure” and confirmed on NewstalkZB that staff misled the minister about cost increases. Public Service Commissioner Sir Brian Roche said the integrity issues “go to the core of the behaviours and ethics required of public servants”.
One legal wrinkle deserves attention. The independent review found no evidence of deliberate intention to mislead. Stanford’s language goes further than the review technically supports. If the Public Service Commission investigation leads to disciplinary proceedings, that gap will matter.
The $336 million programme now under a cloud
The BCU write-off is painful but contained. What should worry business owners is the next programme in line. At Stanford’s request, Roche will also examine the broader Our Future Services immigration transformation programme. Its detailed business case puts the estimated cost at $336 million over seven years, projecting $453 million in benefits. If the Commission finds similar integrity problems in how that programme has been reported to ministers, the financial exposure is an order of magnitude larger.
For businesses that depend on immigration pathways for skilled workers, this matters directly. The system modernisation they were promised is now under a cloud of doubt, managed by a ministry whose own chief executive admits its governance failed.
This is not just an immigration problem
MBIE is a super-ministry. It oversees employment law, building and construction, energy, and business regulation. Its contractor and consultant spend peaked at $89.8 million in 2022/23 before falling to $30.6 million in 2024/25 after a $56 million baseline reduction through Budget 2024.
Stanford herself has admitted her confidence in officials has been “knocked”. The BCU project started under Labour in 2018, and the review found officials withheld information from Labour ministers too. This is not a story about one party’s oversight failures. It is a story about a public service culture where officials could manipulate project finances, ignore assurance reviews, and delay bad news to ministers for years, across two governments, without consequence.
Until someone is actually held accountable, there is no reason to believe the next $336 million will be managed any differently.
Sources
- RNZ: Immigration officials ‘deliberately withheld’ information on failed technology upgrade (2026-06-17)
- RNZ: Immigration project wasted millions, finances remain unclear (2026-06-17)
- RNZ: Scrutiny week brings Immigration NZ’s integrity failings into focus (2026-06-17)
- 1News: Seven years, $33m, no results: failed govt IT project ‘misled’ minister (2026-06-16)
- BusinessDesk: Inside the Immigration NZ $33.4m IT biometric upgrade with NEC that became a case study in failure (2026-06-17)
- NZ Herald: ‘Furious’ minister reveals officials misled her, knowingly avoided Cabinet (2026-06-17)
- NewstalkZB: Nic Blakeley on the independent review into a failed project (2026-06-17)