Up to 100 invoices for managed isolation/quarantine stays will be referred to a debt collection agency for the first time this week.
It is the first tranche of MIQ bills being referred for debt collection. Debt recovery action isn't considered until invoices are 90 days overdue, or 180 days from when the invoice was issued.
As at April 30, 291 invoices were overdue by more than 180 days with a combined value of $909,535. It was unclear how much the first tranche of debt collection represented.
A total of 13,221 invoices had been issued for total MIQ stays as at May 9 - worth $60.8 million. Of this, $38.3m had been paid (63 per cent). A further $16.4m was not due to be paid yet, as they were within the 90-day period.
New Zealand citizens and permanent residents were supposed to pay $3100 for quarantine, with $950 for each additional adult and $475 for each additional child (3-17 years old).
Covid-19 minister Chris Hipkins said it was taking too long to chase up overdue payments.
"The billing system is more complex than charging people who've stayed at a hotel, for instance, for a number of reasons. Some are liable to pay and others aren't," he said.
"For example, when people stay in New Zealand for more than 180 days they aren't charged and when people come in a group the fees can vary. The system needs to be easier to administer.
"I've sought advice on ways to do that and on reducing the time before bills are considered overdue. It's currently 90 days and we're looking to reduce that to 30 days or to put people who are in challenging circumstances into a repayment plan."
National Party Covid-19 spokesperson Chris Bishop said the Government should be doing more to see MIQ bills repaid, claiming it operated similar to an honesty system.
"It's taking months for invoices to be issued for stays in MIQ, and then people have a further three months to pay on top of it. It's a very lax system.
"The Government should be chasing people up who haven't paid their MIQ fees."
Act Party leader David Seymour said the Government's MIQ payment scheme was out of step with other comparable payment schemes.
"This is just further administrative cost due to the most basic of mistakes, they should have charged people up front."
In March, the NZ Herald reported only a third of the amount had been billed for quarantine up to February 28 - $10.7m out of $30.2m - has been paid.
At the time, NZ Credit and Finance Institute director Owen Goodwin said he was "startled that there is that level of time lag between invoicing and payment".
In the March article, Auckland paediatrician Professor Innes Asher, who visited her son and his wife and young child in Sydney for Christmas, said she expected to pay the $3100 fee when she left the M Social quarantine hotel on the Auckland waterfront on January 12.
Instead she was told she would get an invoice. When the invoice had not arrived three weeks later, she emailed the ministry to ask for it.
"I was shocked, because we know how much it's costing the country," she said.
When she emailed to ask for an invoice on February 2, an MBIE official replied: "Our fees team is a little behind with emailing invoices at the moment unfortunately. How[ever] if you wish to have your fees paid asap, please email our fees team to arrange to have that done, email@example.com."
Asher said, "The next day I got an invoice anyway and I had 90 days to pay.
"I had already set aside the money so I paid immediately, but it's a recipe for bad debts because people will forget to pay."