The referendum on the electoral system on 26 November will give voters the chance to endorse or reject MMP, as well as consider what system might replace it.
Radio New Zealand political reporter Julian Robins profiles MMP.
It was almost 20 years ago that New Zealand decided to dump the old First Past the Post electoral system and replace it with Mixed Member Proportional system.
Gone was the winner-takes-all approach that saw the Labour and National parties completely dominant in Parliament.
In its place was a new world of coalitions, list MPs, support deals with minor parties and minority Government.
Michael Bassett, a former Cabinet Minister in the fourth Labour Government, argues that MMP has resulted in weaker government policy, as the major parties are forced to do deals and make compromises with minor parties.
"I think it's probably slowed things down and, of course, New Zealand has slowed down too. And a million New Zealanders have left the country."
MMP is a system of proportional representation. You get two votes - one for your local MP, the other for a party. And it is that party vote that decides the overall shape of Parliament and how many seats each party gets.
Sandra Grey, from the Campaign for MMP, says this voting system has strengthened the hand of Parliament and acted as a check on the power of the Cabinet.
"All of us get a say in what Parliament looks like through the party vote. And that's really crucial, particularly if you're the National voter in a safe Labour seat or the Labour voter in a safe National seat.
"If there's no party vote, you feel quite disempowered by the whole process of voting - and that, to me, isn't something we want for a democracy. We want everybody to be in there on election day wanting to vote."
Balance of power
To make it into Parliament, a party must win 5% of the party vote or win an electorate.
In the last Parliament, eight political parties passed one or other of those thresholds - but New Zealand First, which one just over 4% of the party vote but did not win an electorate, did not.
Jordan Williams, from the anti-MMP lobby group Vote for Change, believes MMP has delivered too much power to the minor parties.
"Whoever holds that balance of power between Labour and National in New Zealand, ultimately determines after every MMP election we've had who forms the government. And the best example, of course, is Winston Peters. Out of five MMP elections, he's chosen who governs in two of them.
"We think that decision should be up to New Zealanders in the polling booth, knowing what type of government they're getting."
Mr Williams is also critical of the party list process, saying it rewards politicians who toe the party line - although he accepts it has helped make Parliament more diverse.
One of the members of the 1986 Royal Commission on the Electoral System which recommended MMP was Professor Richard Mulgan. He says on the whole, the system has worked as expected.
"I think New Zealand's actually operated the system quite well. It's retained the serial system, which I think is useful, because it keeps the Government on its toes and provides you with an alternative governing party.
"At the same time, it ensures that the governing party, whichever one's in power, has to be more consultative than in the past."
If a majority of voters decide to retain MMP at the referendum, the Electoral Commission will conduct a review of the system next year.
