The New Zealand Herald

NZ exposed to cyber attacks

Project to update Defence Force tech plagued by issues

- Ce´ cile Meier

A$182.5 million project to upgrade the New Zealand Defence Force’s IT infrastruc­ture has been plagued by challenges and delays, leaving New Zealand increasing­ly exposed to cyber threats and out of touch with its allies.

A shift of the New Zealand Defence Force’s (NZDF) IT to the cloud and improved connectivi­ty between defence headquarte­rs (HQ) and bases were meant to be establishe­d by 2021/22, according to a 2019 strategic document.

But the major upgrades are yet to be delivered, despite about $100m being spent, two sources familiar with the project said.

Transforma­tion programme

The NZDF started an IT transforma­tion programme towards a “modern and secure infrastruc­ture” in 2019.

The upgrades were “core requiremen­ts for the NZDF to operate as a networked combat force”. Existing in-house IT infrastruc­ture was out of date, and performanc­e was “significan­tly slowed and degraded”, a Cabinet paper said.

This came with increased costs and increased security and data integrity risks, including vulnerabil­ity to cyber threats. Cabinet approved a business case for the investment in 2020.

“The nature of modern warfare is changing, with new military capabiliti­es expected to generate vast amounts of data. The full benefits of investment in new military capability can only be realised if the Defence Force can effectivel­y capture, store, integrate and disseminat­e data and insights generated by new capabiliti­es, including having the ability to integrate with our allied partners where necessary,” the Cabinet paper said.

The “whole of life” cost of the cloud and connectivi­ty projects would be $182.5m over a five-year period, starting in the 2020/21 financial year. The NZDF would use its operationa­l baseline funding for the projects.

‘Starved of resources’

According to another report, the cloud and connectivi­ty projects had a 2021 deadline for delivery. But by 2022, the projects were yet to be delivered.

They were renamed the Digital Informatio­n Programme (DIP) and formally approved by NZDF governance in September 2022, according to official informatio­n.

A source said the DIP should have been delivered by the end of 2022. Instead, it was “starved of resources” despite its crucial importance in protecting Aotearoa from digital warfare.

“In the future, most warfare will be digital. As part of the Five Eyes network, we are falling far behind if we don’t adopt these digital products. This is a crucial programme of work to lift the capability of NZDF and to bring it on par with its partners,” the source said.

The source said the project was yet to be delivered after wasting more than three years and an estimated $100m spent on contractor­s, internal staffing and technology.

The team working on it made several attempts to escalate their concerns with NZDF’s governance, to no avail.

Agile methodolog­y

The project was to be developed under a “scaled agile framework” methodolog­y, where improvemen­ts are made iterativel­y, allowing methods to be tested and improvised.

As a result, the team could not plan long-term and battled for resources within the wider digital team, the source said.

Challenges and delays

The cloud and connectivi­ty projects faced challenges, which delayed their delivery, the NZDF’s chief of staff, Air Commodore A.J. Woods, said.

“These challenges included balancing resourcing, technical design issues, delays in progressin­g cases through Cabinet for approval and supply chain issues.”

The NZDF could not provide BusinessDe­sk with the cost of the projects to date because the funding came from within the Defence Digital Group (DDG) baseline.

Defence digital budget

According to official data, in the five years to 2022/23, the DDG’s budget was $653.5m, including about $108m spent on contractor­s and consultant­s.

The transforma­tion programme had three goals, to be delivered sequential­ly to enable the networked combat force by 2025, Woods said. The programme delivered “the digital operating model” by 2022, and parts of the cloud and connectivi­ty projects would be delivered by December.

The Government committed $408m to the NZDF over four years to upgrade dated equipment and infrastruc­ture in the 2024 Budget. The upgrades included “some digital services and a modernisat­ion of devices and productivi­ty tools”. The NZDF was one of the agencies excluded from spending reductions the Government demanded of public services.

In the future, most warfare will be digital.

NZDF source

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