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Cost of IRD technology project unclear

Sunday 5 May 2013 12:07 p.m.

Peter Dunne is promising to take one step at a time when IRD upgrades its technology at a ballpark $1.5b cost

Peter Dunne is promising to take one step at a time when IRD upgrades its technology at a ballpark $1.5b cost

The $1.5 billion projected cost of new computer and policy systems for Inland Revenue is a ballpark figure, Revenue Minister Peter Dunne says.

Mr Dunne is promising to learn the lessons of poorly executed government technology projects and says he has been talking to technology entrepreneur Rod Drury and others about it.

Mr Drury, who founded online accounting company Xero, has said the $1.5b figure is an obscene amount of money for the Inland Revenue upgrade, which could be done for around $500 million.

Mr Dunne told the Q+A programme today some of the points Mr Drury made were timely reminders and warnings.

"We're certainly happy to work alongside him and others in the industry in New Zealand," Mr Dunne said.

Business New Zealand chief executive Phil O'Reilly said the public debate about the cost of the project should recognise the value it would create for New Zealand businesses.

Mr Dunne said the $1.5b IRD upgrade involved a series of specific projects over ten years.

"Until we start the detailed work on each particular project that figure is really only a ballpark estimate. I expect it will differ."

"We will take our time. We will get it right before we move from one stage to the next," he said.

The revenue system is at capacity, he says.

"The department's revenue system began simply as a tax system, but over the years it has had to take on everything from child support, to student loans, to KiwiSaver and Working for Families."


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