A select committee with a majority of National MPs has rejected Justice Minister Judith Collins' attempt to ban party workers wearing rosettes and streamers on election day.
The justice and electoral committee has reported back on Ms Collin's Electoral Amendment Bill making changes to election laws, unanimously recommending scrapping a provision to prevent rosettes being worn on election day.
Committee chairman Scott Simpson said the committee also called for a fuller review of the long-standing ban on political advertising on election day.
Parties and candidates now have to remove all advertising by midnight on election eve and cannot campaign on election day, and the media cannot publish stories or advertisements that might sway voters.
The only exception to the ban on electioneering material has been party volunteers wearing rosettes or streamers in party colours on their cars - and that has been the source of most complaints to the Electoral Commission.
Ms Collins said through a spokeswoman that the caucus and Cabinet would now consider the report before the bill went to its second reading.
The select committee has nine members - five from National - and the bill included Electoral Commission recommendations after the last election.
Labour's justice spokesman Andrew Little said the committee's recommendation was "a concession to common sense". He said the rosettes identified party workers, who often took voters to booths.
He also hoped Ms Collins would agree to the wider review of election day rules, saying countries such as Australia did allow election day campaigning.
Ms Collins had originally put the provision in for consistency with the general election day rules. Her change would have meant only the scrutineers in the booths could have worn the rosettes to distinguish them from electoral officials.
The committee also recommended against wider use of "easy vote" cards and proposed instead that each voter verbally confirm their identity at the booth rather than simply handing over the card.
The bill also provides for full online voter enrolment using the new RealMe electronic identity verification system.