Housing Minister Megan Woods is being put in charge of the managed isolation and quarantine facilities.
The move follows the revelation two women were able to leave managed isolation on compassionate grounds, without having a test.
RNZ has also received multiple reports of people mixing freely within the facilities, including those at different stages of the 14-day period.
A government spokesperson says this is a new role, and Woods is not taking the responsibility away from anyone.
They said now the country was not facing an emergency situation they wanted to move the oversight of this operation out from the All of Government response to the Ministry of Business, Innovation and Employment (MBIE).