The Ministry for Primary Industries (MPI) is being called out for not doing enough to reduce campylobacter cases.
Consumer New Zealand testing on 40 chickens bought from supermarkets found 26 of them were infected with the bacteria, which can cause gastro and food poisoning.
Chief executive Sue Chetwin says MPI needs to bring in testing regulations to actually hit its target of 10 percent fewer cases by 2020.
"We don't think they're coming down fast enough, and we can see there are other ways of doing that."
She wants chicken to be tested just before it hits the shelves, rather than only before it leaves the meatworks.
"That certainly happens in the UK, and they've seen a rapid decline [in campylobacter cases]."
Poultry Industry Association director Michael Brooks told Fairfax the testing Consumer was used was stricter than the industry standard, and chicken was only behind around 40 percent of campylobacter cases in New Zealand.
Countdown supermarket told Newshub it tests samples of its chicken, sourced from Tegel and Inghams, every day.
"Campylobacter is common in raw chicken and raw red meat, and is killed with proper cooking," says Liz Luton, divisional quality manager. "Simply testing for its presence in raw products is not, on its own, particularly informative with respect to food safety."
Ms Luton says MPI regularly audits Countdown's meat plant, which includes microbiological testing.
Foodstuffs said it is "unfortunately" a reality that chicken commonly contains campylobacter, and "testing of raw chicken at the store would be of little to no value."
Cooking chicken properly will kill off small amounts of campylobacter, making chicken with only a low amount relatively safe to eat.
"People cooking chickens on their barbecue and not doing it properly are probably at a high risk of getting this nasty condition," says Ms Chetwin.
Just-released research from Michigan State University has shown how undercooked chicken infected with campylobacter can cause Guillain-Barre Syndrome, an autoimmune disorder.