Police officers are likely to face drug and alcohol tests to ensure they are not under the influence during "critical incidents" such as the shooting of Steven Wallace.
The Independent Police Conduct Authority's review of Mr Wallace's death in a confrontation with police in 2000, calls for mandatory testing after such incidents.
It says this would "protect officers from false allegations that they were or may have been impaired by alcohol and/or drugs".
Police Commissioner Howard Broad said last night police were already developing a policy on drug and alcohol testing, but the review comments would "add impetus".
The authority yesterday found that Constable Keith Abbott's shooting of Mr Wallace in Waitara was justified, and cleared police of any misconduct.
The review will be the last official examination of the case.
Chairwoman Justice Lowell Goddard said the authority had investigated rumours that Constable Abbott had been drinking before shooting Mr Wallace and found they had no foundation.
But Justice Goddard said the testing should be introduced as a matter of urgency to "protect individual officers from false allegations" and "indicate a willingness on the part of police to ensure accountability within its own ranks".
Police do not have a testing policy, except for breath testing for alcohol after car crashes involving police.
The term "critical incident" covers shootings and other police actions that have serious consequences.
A similar recommendation was made to police in 2001 as part of a secret internal review after Mr Wallace's death but is yet to be acted upon.
Justice Goddard also noted that the authority and coroner had made similar comments about testing in other cases.
Police Association president Greg O'Connor said testing "would cause as many problems as it would solve", particularly in remote areas where officers were called out while off-duty.
"You will end up with situations where officers in small towns don't come out because they have had one beer and police will be hugely criticised for not taking action when maybe lives are lost because they haven't."
Mr O'Connor said the case of Constable Jonathan Erwood, the sole-charge Mokau police officer prosecuted for drink-driving while answering an emergency call, showed "nothing is clear cut".
Mr O'Connor said testing should not be mandatory, but done only when there was reason to believe drugs or alcohol were a factor.
Mr O'Connor said testing would make alcohol or drugs the main issue in a critical incident even if an officer had "one beer" or "flu medicine ... which contains amphetamine".
The Independent Police Conduct Authority review began in 2007 shortly after the authority was set up with greater independence than its predecessor, the Police Complaints Authority, and new powers.
The decision to review the Wallace case showed Justice Goddard was determined the authority would make its mark as an independent civilian oversight of the police unlike its much criticised predecessor.
The extensive review has taken more than a year and used the authority's independent investigators to interview more than 50 people, examine the original police files, transcripts from Constable Abbott's murder trial and the coroner's ruling.
Mr Broad said he hoped the review's clarity would "allow this difficult chapter of our history to be closed".
Justice Goddard's other recommendation - that police develop a process to confirm that officers involved in a critical incident were ready for work - would become part of trauma policy.
Mr O'Connor praised the authority review, which he said "would have saved everyone a heck of a lot of angst" if it had been done three months after the shooting.
Mr Wallace's mother, Raewyn, said the review was a disappointment, and "another police cover-up in a series of police cover-ups".
* Steven Wallace - final findings
The Independent Police Conduct Authority review by Justice Lowell Goddard found that:
- Steven Wallace engaged in a "lengthy and violent rampage" through Waitara armed with a baseball bat and golf club, "borne of an unexplained rage, which showed no signs of abating".
- Constable Keith Abbott was justified in arming himself and using the gun within the law and police procedures.
- Mr Wallace had a history of violence.
- Constable Abbott had no other option available to him.
- No evidence supported rumours that Constable Abbott had been drinking at two social functions before the shooting.
- The lack of communication between Constables Abbott and Dombroski reflected the urgency of the situation they faced.
- Police should have done more for Mr Wallace after the shooting, when they refused to give him first aid and did not put a blanket offered by a witness over him. But even if first aid was provided it would not have saved his life.