The report, compiled by a committee of MPs from across the House, said officials failing to meet their obligations to tell the truth and being unaware of mechanisms to inform MPs of sensitive information privately was “negligent” and an “insult to the entire public service”.
However, the committee did not recommend any sanction, given the ministry had apologised.
“We intend that our findings will be of sufficient consequence on their own.”
MBIE has been approached for comment.
The finding stems from revelations aired by Immigration Minister Erica Stanford earlier this year that a $40 million IT project, which was part of a wider biometric systems upgrade, was terminated late last year after about seven years of delays and issues.
The Public Service Commission is investigating the project’s failings, which came to light after Stanford released a report alleging project staff misled her and previous ministers, avoided Cabinet scrutiny and moved on staff who questioned the venture’s viability.
At a March select committee meeting, Allison McDonald, who previously headed Immigration NZ (INZ), which sat within MBIE, was asked by Labour MP Phil Twyford about the risks posed to the project.
McDonald linked delays to the fast-paced evolution of technology and referenced ongoing work to ensure the country’s identity management system was fit for purpose.
MBIE chief executive Nic Blakeley, who had appeared alongside McDonald, echoed how the ministry was in the process of working out what the programme would look like.
Neither revealed the project had actually been scrapped late last year after Stanford was told repeated attempts to bring it to fruition had failed.
Last month, after Speaker Gerry Brownlee had referred the matter to the committee, Blakeley and McDonald told the committee they hadn’t intended to hide the project’s cancellation from MPs.
They said they had believed the matter was commercially sensitive and couldn’t be discussed as negotiations were ongoing.
“MBIE officials did not deliberately attempt to mislead the select committee,” Blakeley said.
He claimed neither he nor McDonald had addressed the project’s status, citing “commercial and budget sensitivities”.
However, he later conceded MPs could have been told the IT project was not continuing or officials could have briefed the committee in a private session.
“In hindsight we should have taken a different approach.
“I agree, we got it wrong.”
Blakeley wouldn’t acknowledge his statements were inaccurate when asked during the hearing, instead accepting they were “incomplete”.
McDonald, who appeared via Zoom from Britain having retired in April, said she had found claims she’d deliberately misled the committee “extremely distressing”.
Noting the March select committee was “fast-moving”, McDonald conceded she could have provided a more specific response to Twyford’s questions.
“I am really sorry that I missed this in the heat of questioning.”
Adam Pearse is the Deputy Political Editor and part of the NZ Herald’s Press Gallery team based at Parliament in Wellington. He has worked for NZME since 2018, reporting for the Northern Advocate in Whangārei and the Herald in Auckland.