Before the Government pumped another $3 billion into the Covid-19 response it was told it would be much cheaper to beef-up contact tracing than force another lockdown.
The review of the August Auckland outbreak also found the number of cases which could be traced fell well short of the promised 1000 per day and that statements made at the daily 1pm press conferences undermined the work on the ground.
Sir Brian Roche and Professor Philip Hill told Covid-19 Response Minister Chris Hipkins the system's capacity and financial stability need to be "urgently addressed" with a 24-36 month timeframe in mind.
The pair were tasked with reviewing contact tracing during the August Auckland cluster.
Overall the testing and contact tracing system delivered a timely and informed response which was actively learning and improving, they said.
"The Auckland outbreak put significant pressure on the system and it is a credit to all those involved that a successful outcome was achieved. New Zealanders can have high confidence that Covid outbreaks can and will be controlled."
Roche and Hill did not find new issues in the system but that there was a continued need for "all important" stress testing, clarity of accountabilities, a fit for purpose structure and a whole system approach.
Before the Auckland outbreak hit it was believed contacts of 1000 cases could be traced a day with Auckland Regional Public Health (ARPH) expected to trace 120 of that number.
But the cluster was far more complex than the first outbreak in April because it largely affected the Pacific community who closely interact with their community.
Because of the resources required to trace contacts in reality ARPH could only handle 20 contacts per day with a surge capacity of up to 80 a day. Though this was never tested as the daily case numbers were always less than 20 in the Auckland outbreak.
Overall it appeared the overall capacity across the entire system was "perhaps even less" than 200 per day.
ARPH told Roche and Hill it couldn't get to surge numbers quickly enough because staff had to be deployed from other areas in the local health system. By the time the pair wrote the report this was being addressed.
But the main issue was "the disconnect" between the Government and the public expecting 1000 cases a day to be traced and the system not being able to deliver that.
"This needs to be resolved as ARPH is currently accepting a significant risk on behalf of the Government. The resolution of this will inevitably involve the need for more resources and require additional funding."
The report said ARPH's budget was about $24 million including a $7m one-off Covid cash injection, but even a short lockdown in Auckland potentially cost billions. Economists at the time estimated it to cost $440m a week.
A beefed-up contact tracing system could avoid the need for a lockdown to blunt the rapid escalation of an outbreak, depending on the circumstances.
The report landed on Hipkins' desk on November 30 and on December 2 Cabinet agreed to pump an extra $225m into supporting health boards to respond to Covid-19.
The funding was included in the $2.8 billion package announced on Friday to keep the Covid-19 border controls and 14-day isolation facilities going until at least June 2022.
In response to the recommendation to boost contact tracing capacity, the Government said system had developed and could now respond more efficiently and effectively in the early stages of an outbreak.
It created a multi-disciplinary National Outbreak Response Unit to spread contact tracing capacity across the system with an on-call roster which can be deployed within 48 hours over summer if needed.
The Government now expects the system to handle 350 new cases a day with surge capacity pushing that up to 500 per day within three or four days.
But this still falls well-short of the 1000 a day target recommended by a contact tracing audit in April by Ayesha Verrall - now a Cabinet minister.
Roche and Hill said given waves in Singapore and Melbourne reached over 900 cases a day, it "seems sensible" New Zealand should be able to do the same - or at least be very clear on exactly how many cases can be traced.
Roche and Hill also found there were "a number of communication issues" between those running the repose, the media and the public.
"For example, some statements at the 1pm media sessions compromised the ability of ARPH to maintain trust with cases and contacts which was extremely problematic."
At the time, there were up to three situation reports between the public health unit and the ministry which required a significant amount of work and was perceived as a lack of confidence and trust in those on the frontline.
The pair wanted to have the contact tracing system stress-tested in various scenarios like a church gathering, a community event or an apartment block - like one involved in the November Defence Force cluster.
In response, a stress test is planned for early next year with a programme of scenario-based exercises set to be developed.
Roche and Hill also wanted better engagement with Māori and Pacific communities about what moving to a quarantine facility meant and said Māori and Pacific health providers should be thanked in person for making the containment of the recent outbreak possible.
Hipkins said one of the things they'd learned about the Auckland outbreak was there was a degree of scepticism out there "amongst some parts of the community around the importance of what we were doing".
"We worked really, really hard to build up that capability so communities can see themselves reflected in the people who they're dealing with around contact tracing… that helps to build trust and confidence needed to be successful."