Dr Smith began and finished his eulogy in Maori and said Sir Peter was a man of exceptional character who was New Zealand's first Maori Speaker of the House and also one of the few Speakers who was a member of the Opposition.
Sir Peter was not only respected by both sides of the House, but Dr Smith said "he was loved by both sides".
Dr Smith said Sir Peter left a special legacy. "He was not only a gentleman but he was a dignified gentleman."
He was the epitome of sartorial elegance, and Dr Smith said he had tried to emulate Sir Peter's standard of dress but his "efforts paled in significance".
Dr Smith said Sir Peter impressed on those in the House they should always conduct themselves in a dignified and decent manner, which was the way he always behaved.
Earlier, Te Arawa kaumatua Te Wano Walters welcomed mourners on to the marae for a brief powhiri before the funeral service, which was conducted by the Rev Manu Wihapi and Bishop Rahu Katene.
As was his wish, Sir Peter lay in a rough-sawn pine box, which was built a few nights ago by one of his sons. He was buried at nearby Wharekaahu urupa.
Sir Peter died in his sleep last Thursday at his home in Ruatoria on the East Coast. He was 82.
He was born and lived in Rotorua for much of his life, working as an orthopaedic surgeon before becoming an MP in 1981 where he served until 1996.
He held the internal affairs, arts, police and defence portfolios during his political career. Sir Peter had a lifetime of public service including several years as a councillor and deputy mayor of Rotorua.
He also served on Maori land trusts around Rotorua and was vice-captain of the 1954 Maori All Blacks.
Sir Peter and his late wife Diane had two sons and two daughters.