The real Budget test: From digital government to digital economy

Small businesses are the engine room of New Zealand’s economy. They employ a large share of the workforce, anchor regional communities, and drive much of the country’s day‑to‑day economic activity. When small firms lift productivity, the impact compounds across the economy.

The challenge is not that individual government agencies are especially hard to deal with. Research consistently shows the real burden sits in the cumulative effort: repeated requests for similar information, inconsistent digital experiences, and fragmented interactions across multiple agencies, obligations and life events. This fragmentation is directly acknowledged in the pre-Budget speech, which points to silos, duplication and overly complex processes as barriers to better performance in the public service.

For many small firms, the biggest inefficiency is that they must go to government to do what they need to do – applying for permits, managing regulatory conformance, accessing grants and support, meeting reporting and tax obligations – each through separate systems and processes. The commercial cadence of small business is not reflected in the expected interactions with government.

The productivity prize sits in flipping this model. Government then becomes part of the small business digital ecosystem, embedded in the workflows and moments where business activity already happens. When public services, regulation and support are designed to plug into everyday business activity, digitisation translates into real productivity gains. This means fewer admin hours, better decisions, and more time spent on customers, staff and growth.

The announced move toward consolidating agencies and adopting common technology platforms creates a window to re-design these interactions from the ground up, so that efficiency gains inside government translate into simpler experiences outside it.

Many of the building blocks already exist. Digital identity, data‑sharing capabilities, core business platforms, sector systems and government services are already in place, or emerging. What’s missing is bringing them together so they operate as a coherent ecosystem, rather than a set of disconnected digital touchpoints.

When people hear “digital in social services”, they often think call centres, online portals and apps. But the reality is, the larger productivity gain sits behind the scenes, showing up as using data and analytics to intervene earlier, joining support up, and reducing the number of people reaching crisis point in the first place. This focus on earlier, more effective intervention aligns with the Government’s stated intent to move beyond short-term “band-aid” spending and instead address the underlying drivers of affordability and social pressure.

Done well, this focuses more on changing the timing and targeting of public investment, than it does on technology. Earlier, better informed decisions can reduce demand on acute services and avoid high-cost interventions that are expensive for the state and disruptive for families.

To deliver this consistently, government needs three capabilities that are currently uneven:

• Safe data sharing across agencies, with clear purpose and strong governance.
• Better insight, using analytics to identify risk early and understand what interventions work.
• Outcomes-based investment, so funding follows results over time rather than activity in silos.

The social investment approach points in this direction by focusing on prevention, measurement and learning, over the full lifecycle of an investment. The implementation of the approach remains uneven across the country. The opportunity is to embed these capabilities as standard practice and to create platforms that democratise the strengths that are already held across the public and community sectors.

We would welcome continued investment in the foundations of the social investment system. That looks like data infrastructure that enables safe and effective reuse, evaluation capability that sharpens decision‑making, and procurement settings that reward outcomes rather than process. These are the building blocks that make prevention the default, improving social outcomes, easing long‑term fiscal pressure, and lifting overall productivity.

If you want growth, you must make it easier to use land well. Few things frustrate people more than slow, inconsistent processes, whether it’s buying a new home, working through a factory expansion, or concepting a renewable energy project.

At its core, resource management reform is about empowering better, faster decisions about land use. That applies at every level - national infrastructure that needs to be resilient as we adapt to climate change, iwi making long‑term investment choices such as geothermal over forestry, businesses deploying capital with confidence, and landowners using their land in ways that reflect their priorities. Those decisions depend on clear rules, good data, and systems that make trade‑offs visible early.

The pre-Budget speech highlights faster housing delivery and infrastructure investment as priorities; a consistent digital layer across the planning and consenting system will be critical to realising those ambitions at scale.

That will not happen through legislative change alone. It requires digital infrastructure that supports the full land‑use system – how plans are created and updated, how land use is understood through data, and how activities are assessed, approved and monitored over time. A national approach can provide a consistent foundation for councils, developers and communities, rather than reinforcing a patchwork of local processes.

Done well, the impact is practical: faster processes with less administrative burden, better decisions supported by high‑quality spatial data, and greater confidence in how rules are applied. For Budget 2026, the signal to watch is investment in shared spatial data foundations and national platforms that councils can plug into. Without this, reform risks being absorbed into existing fragmentation. With it, reform translates into faster delivery of housing and infrastructure, and better long‑term decisions about how land and capital are used.