What we build matters, but how the state supports it matters more

As a nation, we spend a lot of time talking about innovation as if it is something organic, that simply emerges; but that is far from the truth. What matters is whether the environment allows it to grow, which brings us directly to the role of the state.

If there is one thing I took away from the recent ALTeR Law, Technology, and Government Conference, it is this: innovation does not happen in isolation. It is enabled — or constrained — by the system the state builds. If our rules and systems do not move from "inertia to industriousness," we will remain a small, distant economy struggling to compete.

My ALTeR panel was tasked with unpacking the question: how can law support innovation and entrepreneurship in New Zealand?

We often frame innovation as a question of regulation. But the deeper issue is how the state operates as a buyer.

Procurement is one of the most powerful tools we have to impact the pace of innovation, yet right now, in my opinion, it does not support it.

Procurement - The missing lever

Open standards are one way we can ensure procurement supports innovation — an approach already being applied in countries like the UK, Denmark, and France.

Unlike proprietary solutions, which lock innovation inside a single vendor's roadmap, open standards keep the rules public so anyone can build on them and no single company controls the systems a country depends on.

This makes switching suppliers a real competitive option, improves sovereignty, and accelerates innovation. That matters most in government procurement, where long asset lives and public accountability make exit costs a genuine policy concern.

The state has a projected $13 billion technology spend across the public sector over the next five years. This is not just a procurement budget; it is a policy lever.

We must treat this investment as a National Business Continuity Plan. In an era where digital sovereignty and economic resilience are inseparable, we cannot remain passive bystanders to global platforms.

We should look to open source and open standards becoming the default for government procurement technology.

This is not about rejecting global platforms, but about ensuring we are not entirely dependent on a single provider or jurisdiction. It means treating open source infrastructure and local cloud capability as strategic assets, much like the critical minerals in our trade agreements.

We have seen this work before. In 2004, the government created a fund to build e-learning capability in vocational education. This led to New Zealand becoming the first country to back the open source platform Moodle at scale. That investment didn't just move polytechnics online; it seeded Totara, a New Zealand-born software company that built on top of Moodle’s open source foundations to create a new commercial product that now competes globally.

This is also a matter of national security and resilience. We must ensure that where technology is critical to how our country functions, we are not entirely dependent on a single provider or a single jurisdiction. Other nations are already pulling these levers to protect their interests. 

France is a clear example — we supported Tranquil IT, who were working for a French Ministry to develop and scale an open-source alternative to Microsoft Active Directory. The solution contributed to the Ministry achieving a 5-star cybersecurity rating, a level no previous agency had reached, with greater transparency and control over its own infrastructure. 

In April 2026, France also announced a plan to move around 350 internal workstations from Windows to Linux, the minister of public action and accounts saying that the State should break free from dependence, not simply acknowledge it. 

The General Data Protection Regulation (GDPR) is another useful example. Rather than regulation stifling innovation, it created a competitive cloud ecosystem where local providers thrive alongside global ones — European businesses now have genuine choice and more opportunity to be resilient against geopolitical shocks. New Zealand already has a local alternative: Catalyst Cloud has offered hyperscale cloud on OpenStack for over a decade. The government should back more solutions like it. 

Treating open-source infrastructure and local cloud capability as strategic assets can put more focus on ensuring there is no single point of failure in our critical digital supply chain.

The time to act

We cannot maintain economic sovereignty without thinking about digital sovereignty, and we cannot continue to confuse risk aversion with responsibility. Every time we default to a dependency via proprietary lock-in, we are choosing not to build local capability or improve our nation’s digital resilience.

The gap between the pace of technological change and the pace of the state is growing. If we do not address this, innovation will simply happen somewhere else, and we will lose the ability to shape the systems that shape us.

New Zealand needs to rediscover an ethos of self-determination. We don't even have to get it perfectly right today; we just need to get moving. Legislators must ask whether our systems create choice, because when we have choice, we have resilience and more opportunity to innovate.

What we build matters, but how the state chooses to support it matters more.

This article was also published on The Post.