Govt Issues AI Guidance to Regulators in Push for Greater Productivity and Less Red Tape

The Minister argued that New Zealand’s regulatory system has become overly complex and inefficient over time.

The Government has released new guidance for regulators on the use of artificial intelligence (AI), with Regulation Minister David Seymour saying the technology will help improve efficiency, reduce bureaucracy, and modernise New Zealand's public sector.

The guidance, issued this week, is designed to help regulatory agencies identify where AI can safely and effectively be used to improve operations while ensuring that key decisions remain subject to human oversight and accountability.

Government Targets Productivity and Efficiency Gains

Mr Seymour said New Zealand households and businesses have long adapted to economic pressures by finding ways to increase productivity and operate more efficiently, and the public sector should be expected to do the same.

"Outside of Wellington, improvements in productivity and efficiency are the norm. Households and businesses have found ways to do more with less. It's reasonable to ask the same of the agencies they fund," he said.

The Minister argued that New Zealand's regulatory system has become overly complex and inefficient over time.

"For the first time, the full scale and structure of New Zealand's regulatory landscape has been mapped, exposing decades of overlap and complexity," Mr Seymour said.

He said AI technology presents an opportunity to streamline government operations and improve outcomes for taxpayers.

"AI can enable regulators to do more, faster. New Zealand's public service is bloated, snowed in by red tape and inefficient. The AI guidance will help us address those problems," he said.

"An efficient public service that gets bang for taxpayer buck is important to Kiwis."

Large and Complex Regulatory System

According to the Government, New Zealand currently has more than 260 regulators operating across central government, local government, and statutory bodies.

Mr Seymour outlined the scale of the system:

• 95 regulators within central government

• 79 regulators within local government

• 57 statutory bodies, committees, or tribunals

The guidance aims to support these organisations in adopting AI tools in lower-risk areas to improve efficiency without compromising legal or regulatory integrity.

How AI Could Be Used by Regulators

The Government says AI has the potential to assist regulators in a wide range of operational functions, particularly where large amounts of data need to be analysed quickly.

"The guidance shows regulators how to utilise AI in lower risk areas. Used well, AI can help them work more efficiently," Mr Seymour said.

"AI can do powerful work. It analyses at scale, drafts at speed, and surfaces patterns people might miss."

Examples outlined by the Government include using AI to:

• Detect non-compliance and emerging risks earlier

• Prioritise inspections and monitoring activities based on risk

• Identify patterns within large datasets

• Surface supporting evidence for regulatory decisions

• Reduce administrative burdens for both regulators and regulated industries

Human Oversight to Remain Central

Despite the increased use of AI tools, the Government stressed that human judgement and accountability will remain essential in all formal regulatory decision-making.

"Ultimately, regulatory decisions still rely on human judgement, legal interpretation, and accountability," Mr Seymour said.

"That's why regulators need to know how to use it, when use is appropriate and how to set up AI tools for the best chance at success."

The guidance is intended to help agencies manage risks around accuracy, transparency, privacy, and responsible use of AI technologies while ensuring compliance with existing legal frameworks.

Part of Wider Regulatory Reform Agenda

Mr Seymour linked the initiative to the Government's broader push to reduce unnecessary regulation and lower compliance costs for businesses and taxpayers.

"This will drive change in the size of government and support our mission to give taxpayers a fairer deal," he said.

"Every dollar not wasted on bureaucracy is a dollar that can stay with the people who earned it, or be spent on the frontline services New Zealanders actually rely on."

The Minister also argued that excessive regulation acts as a barrier to economic growth and productivity.

"In a high-cost economy, regulation isn't neutral - it's a tax on growth. This Government is committed to clearing the path of needless regulations by improving how laws are made and applied," he said.

The AI guidance and further information are now available through the Ministry for Regulation website.