Statement on further issues concerning the Biometric Capability Upgrade (BCU) Project

The Biometric Capability Upgrade was a seven-year project within the Ministry of Business, Innovation and Employment (MBIE) that was ceased in December 2025.

MBIE previously advised Ministers, the Education and Workforce Committee, and New Zealanders in June that the project costs to be written off were around $33 million. The Greg James review also raised questions about whether MBIE undertook “creative accounting” to keep the project below the $35 million whole-of-life costs threshold to avoid Cabinet scrutiny.

Earlier this week, when reviewing answers that MBIE had provided in response to follow-up questions from the Education and Workforce Committee, my office identified that financial information MBIE had provided in response to a question from the Committee could not be correct.

In response to the questions raised by my office, the MBIE Chief Executive advised me yesterday afternoon that, upon further review, another $6 million in associated project costs had been identified.

“However, the Chief Executive informed my office today that he cannot be confident this further $6 million represents the full extent of expenditure on the BCU and he has made the decision to commission an independent financial audit.

In close consultation with Economic Growth Minister Nicola Willis, we have referred this matter to both the Michael Heron inquiry into the BCU project and the Public Service Commissioner, as we consider it raises significant questions regarding MBIE’s financial controls more generally.

We have also asked the Public Service Commissioner to consider whether the scope of the Heron Inquiry needs to be amended to ensure that all matters in relation to the Biometric Capability project are included. ...