An ex gratia payment of almost $1 million to David Bain is a sensible way of bringing the matter to an end, according to a law expert, but a friend of Mr Bain says it is "hush money".
Mr Bain spent 13 years in prison for the 1994 murder of his family in Dunedin before being acquitted in a retrial seven years ago.
Cabinet has refused to grant compensation but has made a payment of $925,000. In return, Mr Bain has agreed not to take any future legal action.
Professor Mark Henaghan - the Dean of the Law Faculty at Otago University - sat in the gallery during Mr Bain's original trial, and has written about the case.
He told RNZ he thought the government was being realistic with the payment.
"I think it is a very pragmatic way of doing it. I think the government has obviously felt there was some public sympathy for such a drawn-out process for such an individual as this.
"It doesn't fit within their guidelines to give compensation, but they've felt that given the length of the process, and the ongoing stress and cost to everybody involved, they should give some ex gratia payment, and that's what they have done."
A retired Canadian judge whose report on Mr Bain's compensation bid was rejected by the government says today's settlement was aimed at stopping Mr Bain from taking further legal action.
Ian Binnie said he stood by the findings of his report that Mr Bain was innocent on the balance of probabilities.
He said he was insulted by the government's decision to reject his report and stick to its original position that Mr Bain could not prove he was innocent.
"A large part of my report is if he can't prove his innocence it's because the evidence was messed up by the police and the Crown scientist, including burning the carpet that had these very important footprints on it.
"David Bain suffers the consequences because otherwise the police look bad"
But the retired judge who found Mr Bain could not fully prove his innocence also said the government's decision was appropriate.
The government said it would not pay compensation after the report by the former Australian judge Ian Callinan found Mr Bain had not met the threshold to prove his innocence.
Mr Callinan said it was the most complex and drawn-out case he had known.
"Having been informed of the resolution of the Bain case, I think that the way in which the Minister and the government chose to deal with it was entirely inappropriate in all of the circumstances."
Christchurch barrister Nigel Hampton said the government made a pragmatic decision to pay Mr Bain.
"It's pragmatism overcoming principle, and from a lawyer's point of view it's slightly concerning.
"Why do you have cabinet rules, why do you have these established rules if you are then going to succumb to high pressure campaigns and roll over?"
But a friend of Mr Bain said the payment felt like "hush money".
Lindsay Robertson said Mr Bain was innocent, but he hoped the payment would help him get on with his life.
"In the end, if it allows Dave to settle down and have a nice life with his new family, to put some of the crap behind him and get on with his life, then that's a good thing."
The way the government has handled the compensation claim from Mr Bain has received criticism from opposition parties.
Labour Party justice spokesperson Jacinda Ardern said the government had mishandled Mr Bain's compensation claim, which was why the taxpayer now had to pay him nearly a million dollars.
"Regardless of anyone's personal view on the case, I think it's undeniable that the process itself has been absolutely botched.
"More than six years this has dragged out and I think the ex-gratia payment we're seeing being made by the Crown as a result has almost become an inevitability because of that."
She said everyone wanted to see some resolution or conclusion to this case.
"But ultimately, could that have happened some years ago if this process was dealt with more competently from the beginning?"
Greens co-leader Metiria Turei was also critical of the way this claim had been handled, saying it had been "appalling".
"If the payment that's been made is in recognition of that, then that's the least they could do", she said.
"Whether you agree whether David Bain is proven innocent or not, the government must treat these compensation applications with a great deal more justice and more speedily than they have done."
Ms Turei also called on the government to be more transparent about the total amount of taxpayer money that had been spent on the claim, and the break-down of the ex-gratia payment.
However, ACT Party leader David Seymour said he still believed Mr Bain should be paid compensation.
"It's tragic for justice.
"Recently we've had John Banks receive an apology from the judiciary but no money.
"David Bain gets money but not an apology and you'd have to wonder what the judicial system's actually trying to say to people.
"And then Teina Pora gets compensation at 1981 rates in 2016 - this is an absolute mess."
Mr Seymour said the 2011 findings of the court should not be ignored.
"The fact of the matter is he's either been found guilty of an offence, or he has not, and yes, people have prejudices.
"But the fact of the matter is that we need justice in New Zealand and if he's going to be given almost a $1 million then I think we should actually be clear about why he's getting it and we should be saying that he was imprisoned despite not being guilty under the law and that's why he's being compensated and he should also get apologised to."