A project doomed from day one
The Biometric Capability Upgrade was supposed to modernise how Immigration New Zealand verifies identities at the border. Launched in November 2018, it ran for seven years, cycled through approximately a dozen project managers, and delivered nothing. It was terminated in November 2025, and the 2025/26 Budget included a $31.2 million write-off.
The independent review by Greg James found the project was “doomed from the start” thanks to a “very poor business case” and an early scope change that made delivery effectively impossible. MBIE launched the project without ministerial sign-off, pivoted to an off-the-shelf vendor model in 2020 without due diligence, established governance too late, then repeatedly bypassed it.
The true cost remains unclear. Current estimates put BCU costs at roughly $35 million, with a linked In-Person Enrolment project adding another $8.5 million. By autumn 2024, BCU costs had reached $39.9 million before appearing to decrease in official records. Officials cannot fully explain the movement. A further $4.44 million was transferred out of the project between 2022 and 2025, further muddying the numbers.
Staff inside the project described the cost management as “creative accounting” driven by efforts to stay under Cabinet’s $35 million funding limit. The whole-of-life cost was revised upward four times in four years, from $19.5 million to $35 million by 2023.
Ministers got advice that was “complete fiction”
This is not just a procurement failure. It is a failure of the public service’s most basic obligation: giving ministers honest advice.
In March 2024, MBIE sent Immigration Minister Erica Stanford a briefing seeking approval to lift the project’s cost cap to nearly $40 million. The review found that advice was incorrect and misleading. The most recent independent assurance review from late 2023 had reached close to the opposite conclusion, questioning whether the project could deliver at all. Stanford decided to continue the project in April 2024 based on a projected $31 million loss in sunk costs and break fees, a decision built on sand.
Stanford told MPs the findings were “very serious” and “almost as bad as it gets”. She said officials gave her advice that was “complete fiction” and sought more funding without disclosing that previous requests had been declined. Staff who raised concerns were reportedly moved off the project.
Perhaps the most damning detail: the independent review was delivered to MBIE two months before it was passed on to Stanford. A ministry sat on a report about its own failure for two months before handing it to the person responsible for holding it to account. That delay alone should end careers.
This is not a partisan story. The project ran through both the Labour and National governments. Both were kept in the dark.
The $336 million programme that now carries this baggage
The write-off would be damaging enough as an isolated failure. It is not isolated. In February 2025, Cabinet approved a $336 million Our Future Services programme to modernise the end-to-end immigration system, projecting $453 million in monetisable benefits and $80 million in annual net savings. That programme is now under a cloud.
Public Service Commissioner Sir Brian Roche has confirmed he will investigate and appoint an independent investigator. He said the integrity matters highlighted by the review “go to the core of the behaviours and ethics required of public servants, and the ability of Ministers to have confidence in the advice they receive from officials”. Stanford has asked Roche to examine the broader Our Future Services programme specifically.
MBIE chief executive Nic Blakeley offered an apology to MPs and said he took accountability on behalf of his department. Apologies are easy. Accountability means consequences.
What employers should actually worry about
For any business that relies on immigration to fill skilled roles, this matters in three concrete ways.
First, the underlying IDme identity management system remains what Stanford herself described as unstable. Employers hiring internationally for construction, healthcare, technology, or hospitality roles should expect ongoing visa processing fragility. There is no quick fix.
Second, the $336 million programme that is supposed to fix everything was approved by the same ministry that just burned $33 million on nothing. The business case projections deserve hard independent scrutiny before anyone banks on smoother processing.
Third, the pattern here is not unique to immigration. Optimistic business cases, governance bypassed, costs hidden through accounting tricks, warnings suppressed, ministers kept in the dark. Any business that depends on a government-run digital system, or that bids for government IT contracts, should understand that ministerial oversight of these projects is weaker than anyone in Wellington wants to admit. Until that changes, every promise of digital reform from a public agency deserves scepticism, not trust.
Sources
- RNZ: Immigration officials ‘deliberately withheld’ information on failed technology upgrade (2026-06-16)
- RNZ: Immigration project wasted millions, finances remain unclear (2026-06-16)
- 1News: Seven years, $33m, no results: failed govt IT project ‘misled’ minister (2026-06-16)
- NZ Herald: ‘Furious’ minister reveals officials misled her, knowingly avoided Cabinet over ‘doomed’ immigration project (2026-06-16)
- The1News: Immigration officials ‘deliberately withheld’ information on failed technology upgrade (2026-06-16)
- Beehive: Public Service Commissioner to investigate failed $33 million immigration tech project (2026-06-16)