The Government says there is an insatiable appetite for online services despite ongoing concerns with privacy breaches.
It wants to have all new services from government departments offered online by 2017.
Internal Affairs Minister Chris Tremain said there has been a lift of 20% in the past six months in the number of people applying for financial assistance from the Ministry of Social Development.
Mr Tremain said online options are faster, easier and cheaper to use and the Government needed to lift the bar to satisfy those demands.
He said extra funding will be given to the Government Chief Information Officer to provide better oversight of privacy and security matters, and independent advice for major technology projects.
Mr Tremain told Radio New Zealand's Morning Report programme a rejig of government online services is expected to save up to $100 million a year.
He said the savings would come from smarter use of emerging technologies, including cloud technology.