The corruption problem
Corruption is often hidden. It involves secrecy, deception and deliberate efforts to avoid detection, which means reliable data is limited.
Like other countries, New Zealand faces challenges in understanding the true scale of corruption. Perception surveys can tell us how people feel about corruption, but they cannot fully show how often it occurs or what it looks like in practice. It is estimated that in New Zealand anywhere between $601 million and $12.97 billion taxpayer dollars are lost every year to fraud and error, including corruption.
How corruption undermines economic growth and social cohesion
Corruption diverts public resources, distorts decision making, undermines trust in institutions and weakens outcomes across economic, social and regulatory systems. It compromises fairness, reduces the quality and safety of services, and damages New Zealand’s reputation as a reliable and transparent place to do business.
Institutional and democratic impacts
When integrity standards are not upheld, confidence in public institutions declines. Trust in procurement processes, funding decisions and regulatory enforcement is weakened. Decisions influenced by corruption serve private interests rather than the public good, which undermines fairness, accountability and the legitimacy of government.
Economic impacts
Corruption increases costs, distorts markets and discourages fair competition and investment. Businesses that rely on merit are disadvantaged when contracts or opportunities are influenced by improper relationships or payments. Public funds are used inefficiently, resulting in poorer services and reduced value for taxpayers.
Social impacts
Corruption contributes to inequality by directing resources and opportunities away from those with the greatest need or merit. It can reduce access to quality services and erode public confidence in fairness and equal treatment. This weakens social cohesion and trust between communities and institutions.
Security and law enforcement risks
Corruption within public roles can undermine enforcement systems and create vulnerabilities that may be exploited by organised crime. Misuse of authority or access to information can compromise regulatory, border or law enforcement functions, reducing the effectiveness of safeguards designed to protect the public.
Environmental impacts
Corruption can result in inadequate enforcement of environmental protections, leading to pollution, resource depletion and long-term damage to ecosystems. These impacts threaten our natural resources, key industries such as tourism and agriculture, our cultural values and the wellbeing of current and future generations.
Individual consequences
Individuals involved in corruption face serious legal and personal consequences, including criminal conviction, fines, imprisonment, loss of employment and long-term reputational damage.
Find out more about corruption
-
Corruption and fraud rarely happen by accident. Pressure, opportunity and rationalisation, as well as skilled manipulators, can make corruption hard to detect
-
Corruption is a group of behaviours that can be subtle, obvious or escalate over time
-
Any organisation can be impacted by corruption, but certain key operational areas carry higher risk
-
Effective corruption prevention requires capability, prevention, detection and response controls that are focused on priority domains
Download the guide
Corruption prevention guide: Managing corruption risk in the New Zealand public sector
More information
- Conduct pressure testing to identify and reduce fraud and corruption vulnerabilities in your organisation
- Complete our online learning modules to strengthen your fraud awareness
- See how a robust and well-structured procurement process is the first line of defence against procurement fraud and corruption
- Explore controls that organisations can use to help prevent fraud and corruption from happening in the first place