The private sector will be given the responsibility of allocating tens of millions of taxpayer dollars in Whanau Ora contracts from 2014. The welfare programme has been driven by the Maori Party and in particular its co-leader Tariana Turia.
Whanau Ora providers are funded to deal with families as a whole and address all their problems, rather than through different welfare agencies such as health, Work and Income and justice.
At present, the Whanau Ora has about $164 of funding over four years, which is administered by the Ministry of Maori Development (Te Puni Kokiri).
That will be handed over to three non-governmental commissioning agencies established from within the community sector: one for the North Island, one for the South Island and one for Pacific communities.
Whanau Ora Minister Tariana Turia said on Tuesday that the original recommendation some years back was for this model.
"The Government at that time felt that because it was so new they wanted to have an assurance that it was going to work, it was something different. And so now that they have seen that, they're satisfied that it is time to move it."
Mrs Turia said she wants to see the new model in place by June 2014.
New Zealand First leader Winston Peters says changes to the way contracts are awarded is not the way to alleviate the problems facing Maori, and a government agency should be responsible for allocating funding.
"When you've been dishing up money to rugby clubs to have a great big hooley over the weekend, or money that's got to the gangs, or money that's been paid out to certain so-called social agencies who have not delivered one service - you've got a real concern here. And, sadly out there in Maoridom, there is a significant need - but this is not the conduit or agency that's going to help."
Mr Peters said changing the governance model without ensuring transparency makes a mockery of the needs of Maori and of taxpayer funding.
Labour's social development spokesperson Jacinda Ardern says while the party supports the principle of Whanau Ora, it has concerns about accountability, as contracts will be moved away from the government agency.
"There is certainly a need if we are going to ensure that Whanau Ora is a sustainable programme, we do need to make sure that we retain accountability and transparency of the programme. We've got $164 million of taxpayer money going into this programme - to simply contract all of that out there to just three agencies does pose some serious questions."
But a member of the Whanau Ora Governance Group believes community organisations are more than capable of administering large amounts of funding. Merepeka Raukawa-Tait, a former chief executive of Women's Refuge, said community providers are the equal of any government agency.
"Community providers are not the B team. They are in charge of significant millions of dollars through their contracts. They're accountable for that money, they've held those contracts for many years, they've been audited till the cows come home ... These days, you can line them up alongside any other agency in this country."