PM prepared to deal with NZ First

Prime Minister John Key says the National Party would prefer to work with its current support partners in any post-election deal, but he is now prepared to negotiate with New Zealand First.

Mr Key says it is likely that National will need partners if it wins this year's election - and that may include the Conservative Party if it wins any parliamentary seats.

Prime Minister John Key outlines National's options at Parliament.

Prime Minister John Key outlines National's options at Parliament.

Photo: RNZ

New Zealand First leader Winston Peters.

New Zealand First leader Winston Peters.

Photo: RNZ

At present, National is supported on confidence and supply by ACT, United Future and the Maori Party.

John Key ruled out New Zealand First ahead of the past two elections, saying it was a matter of principle. However on Tuesday, told reporters that six years have passed since the controversy over election donations and should National be returned to Parliament he is not ruling out post-election discussions.

"New Zealand First is an unlikely partner. However, unlike the previous two elections, I'm not prepared to totally rule them out today. In 2008, we ruled them out because we were unable to reconcile some of their statements on the (Owen) Glenn donation."

Mr Key says he believes National voters would rather see him do a deal with New Zealand First than allow a Labour-Greens government come to power.

The Prime Minister later told Radio New Zealand's Checkpoint programme he believes there is common ground to be found between National and the Conservatives.

"Well, I think they're a party we can work with, they're untested and unknown. We haven't had discussions really with them of any sort of thought. In the end, you know, I can't categorically say to you that it would be absolutely perfect - I just don't know."

John Key says if National decides to endorse potential allies in some electorate seats he will be a bit more direct, rather than having a symbolic cup of tea.

Conservative Party leader Colin Craig says he will outline his party's bottom lines for post-election negotiations during the election campaign, and it all comes down to numbers.

"If we're going in there and I'm bringing half a dozen MPs, that's significant. If we're going in there and we're bringing double digit MPs, that's very different. So it does depend a little on the support we get. Key issues for us are changing the silly anti-smacking law."

Listen to Checkpoint interview with John Key ( 10 min 18 sec )

Listen to Colin Craig on Checkpoint ( 8 min 23 sec )

Listen to Radio New Zealand's political editor on Checkpoint ( 4 min 3 sec )

Dunne reinstated

The Prime Minister on Tuesday reinstated Peter Dunne as a minister. The United Future leader was forced to resign his ministerial posts in 2013 after he refused to fully cooperate with an inquiry into who leaked a report into the Government's spy agency.

Peter Dunne.

Peter Dunne.

Photo: RNZ

At the time, John Key said he couldn't have a minister in his executive who wouldn't co-operate with an inquiry he himself had commissioned.

Mr Dunne has always denied being the source of the leak; Mr Key was asked by reporters at Parliament on Tuesday whether he now believes that to be true.

"I'm prepared to accept Mr Dunne at his word, but I can't categorically support that view because I don't actually know what happened there. But the reality is, that in the five years that we worked with Peter Dunne as a minister, he was a very good minister."

Peter Dunne will be the Minister of Internal Affairs, Associate Health Minister and Associate Minister of Conservation outside of Cabinet.

Mr Dunne says he's looking forward to resuming his ministerial duties and taking on the Internal Affairs portfolio, which he last held 18 years ago.

"The Prime Minister and I have always had a very good personal relationship. It goes back long before he became the leader of the National Party. And I think over that period of time we've built up not just a level of friendship, but a level of trust and understanding. I think that's what you're seeing reflected now - I can certainly work comfortably with him."

New roles for some

The current Internal Affairs and Local Government Minister, Chris Tremain, is being stepped down as a minister before he retires from Parliament at the general election.

Michael Woodhouse will be promoted to the vacancy in Cabinet and retains all his current responsibilities.

Paula Bennett picks up the role of Minister of Local Government in addition to her current portfolio responsibilities.

The new Minister outside Cabinet will be Peseta Sam Lotu-liga, who will be appointed Minister of Pacific Island Affairs and Associate Minister of Local Government.

The changes take effect from 28 January.

Next story in Political: Wealth gap economic threat - forum