Aotearoa New Zealand’s digital path to progress: Will Budget 2025 prioritise digital enablement?

Key announcements from Budget 2025

• Introduction of a new 24/7 digital primary care service as part of broader primary care funding package
• $7m funding for Pharmac to improve its data and digital infrastructure to enable more effective engagement with suppliers, stakeholders and patients
• Introducing new SaaS system for standardised assessment and Aromatawai tool for Years 3-10 students
• $28.6m funding to implement new digital maritime navigation and safety specifications
• $60m funding to address gaps in New Zealand Defence Force’s digital information and capability

As the Government aims to drive productivity and growth with this year’s Budget, digital enablement stands out as a powerful and underused lever to unlock the country’s full potential.

Economic growth and efficiency have been central themes through the first half of this Government’s term.

Growing the economy helps increase the Government’s tax revenue, while improving efficiency ensures each dollar is spent more effectively. Given the tight fiscal constraints forecast for the next four years, tackling these dual objectives is even more important.

The ability of digital technology to do this is unmatched, yet we still lack a coherent national strategy, the required investment or even unambiguous desire to do more.

Few areas of investment offer both the opportunity for growth and efficiency at a national level, and while the Government can’t be expected to do all the heavy lifting, it does have a critical role to play.

The opportunity

The impact of digital technology in the private sector has been transformational, reshaping entire industries, from agriculture to banking to transport to food delivery services.

In the public sector, pockets of transformation have been equally impressive. For example, the tax experience for New Zealand individuals is the gold standard for digital. Despite these successes, we lack a national approach to invest in digital capability and infrastructure.

From an efficiency perspective, digital technology acts as a ‘resource multiplier’ – allowing organisations to achieve outcomes with greater productivity and quality. This goes beyond automation of processes – leading organisations are using digital to change service delivery, support better decision making and enable improved public and private collaboration.

When it comes to economic growth, digital enablement is equally crucial.

Digital infrastructure makes it easier for businesses to interact with each other and with customers – by facilitating identity verification, payments and managing credentials and appropriate access to data.

Growing the value of our exports also demands digital transformation across supply chains, making them not only more efficient but also more transparent.

Overseas consumers are increasingly seeking detailed information on how products are sourced - whether farmers, fishers, and foresters treat land, animals, and workers ethically. To capture the value of our investments in these areas we must be able prove that to consumers. Digital is the way this is being done globally and is what is expected by the types of people who will buy high-value New Zealand goods.

Beyond economics, the future of government is digital-first and citizen-centric. Research across Asia Pacific has shown that leading government organisations are increasingly customer-centric, use data and analytics to anticipate the future and to create place-based services and outcomes. In New Zealand, reports such as the State of the City for Auckland highlight the importance of technology and innovation in accelerating the progress of our largest city’s economy.

From the perspective of social outcomes, digital enablement and data infrastructure are critical to social investment – doing better for our most vulnerable citizens, and creating long term social outcomes relies on having high quality data that is safely, securely and appropriately shared, so that services are designed in an evidence-based and tailored way.

The Government’s role

The current Government has technology savvy, ambitious, and informed Ministers around digital enablement. There is real optimism “they get it” in Wellington and are going to start making it happen.

However, the true measure of success will be tangible action across several critical areas:

• Machinery of Government Reform: Agencies must be structurally equipped to deliver digital-first services. The Briefing to the Incoming Minister for Digitising Governmentin 2023 noted “modern, agile, digitally enabled services that span agency boundaries challenge the public service’s existing funding, governance, and delivery models.” Overcoming these entrenched barriers will require leadership from the State Services Commissioner, Treasury, and the Government Chief Digital Officer (GCDO).
• Digital Public Infrastructure (DPI): Investing in scalable, shared digital platforms is key. DPI underpins everything from digital identity systems to data-sharing frameworks — foundational elements for a modern government. This same infrastructure can be used by public and private sectors to accelerate digital. A key aspect of DPI is the funding and delivery models mean government does not have to “foot the bill”. By leveraging the private sector more actively, the Government can get world-class digital infrastructure without having to trade-off other critical investments.
• Openness and risk tolerance: Progress requires a willingness to experiment, learn, and sometimes fail. A more open and risk-tolerant culture within government will be crucial for fostering innovation. This includes a commercially astute approach to collaborating with the private sector – including homegrown innovators and globally experienced hyperscalers – to achieve outcomes at the right value point.

What we hope to see in the Budget

This year’s Budget must show real intent and be backed by investment to make it real. We hope to see digital investment and infrastructure given the same level of attention, funding, and political backing as physical infrastructure projects.

Roads of National Significance capture headlines because they deliver visible benefits to specific communities and regions. But digital investments — when designed and executed well — can uplift the whole nation, driving economic growth, improving services, and strengthening communities across Aotearoa New Zealand.

This blog was originally published on Deloitte.com/nz