Government's Digital Reset Plan identifies major hurdles for health sector tech delivery

NEWS  - eHealthNews editor Rebecca McBeth

A rapid review of digital delivery across government singles out Health New Zealand as facing “major hurdles in delivering tech and service innovation – despite the huge productivity opportunity in health spending”.

The Delivering Digital Government – Reset Plan, says Treasury's assessment suggests a 5 percent saving in the health sector's labour costs through digital productivity improvements could deliver savings of around $600 million per year.

Commissioned by public service commissioner Brian Roche, the rapid review finds that the overall government digital system is not working as effectively as it should with funding and approval processes better suited to large capital projects than modern, fast-moving technology investments.

Health New Zealand is a case study in the report, which says the organisation faces difficulties tracking accurate workforce data, including the ability to report true full-time equivalent numbers or junior doctor figures, and cannot provide simple answers to basic data questions from Health, Treasury, or the Government Digital Delivery Agency (GDDA).

It says that innovative commercial models for technology and system innovation at Health NZ become "mired in cumbersome oversight and procurement processes," and that the GDDA "lacks the commercial and market experience or relationships to quickly assess non-standard proposals."

As an example, the report says that it is easier to get approval for $12 billion in annual labour costs than for a $20 million digital project, which must follow a gateway process with Ministerial and Cabinet sign-off.

Innovation trials, such as the use of AI-powered scribing in emergency departments, are described as happening "in spite of institutional settings, not because of them”.

The overall report says that government digital systems suffer from fragmented investment, poor coordination, and a central digital function (the GDDA) that has limited influence over key decisions on funding, design, and procurement. 

Despite costing $42 million per year to operate with 170 full-time equivalent staff, the GDDA has struggled to demonstrate clear value across the system.

Engagement with technology providers is inconsistent and does not support long-term partnerships or co-investment and stronger system leadership and a more coordinated approach are needed to lift performance and deliver better outcomes, it says.

The review suggests; resetting prioritisation so that scarce resources flow to the highest-impact projects; repositioning the GDDA as a central strategist, technical authority, and commercial broker; and reforming the wider system to remove structural barriers that constrain delivery performance.

“Done well, technology investment can materially change how government operates, what it costs, and what it delivers to citizens,” it says.

The review also describes AI as foundational capability that can transform the work of government, but says “NZ has lacked ambition or a coherent strategy for govt AI and is quickly falling behind peers.”

It was the last OECD country to publish a national AI strategy and this focuses on adoption and commercialisation, with no specific timelines, milestones, or measurable outcomes for government AI. 

Roche will consider the findings before making decisions on a way forward. 

If you would like to provide feedback on this news story, please contact the editor Rebecca McBeth.

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