Labour leader and former Foreign Minister Phil Goff says New Zealand should support a vote on Palestinian statehood at the United Nations - though any vote may now be some time away.
Mr Goff said there was an increasing sympathy for the Palestinian people and that a fair solution had to be found.
"I've been in the West Bank. I've seen the humiliation of the people there and the poverty they they live under and it's wrong. The best security for Israel would be to have a Palestinian state that had a thriving economy that could provide work and hope for its people."
Mr Goff said the issue would be a test for the National Government.
It was a positive sign that Foreign Minister Murray McCully had not jumped in straight away and said New Zealand would not support the vote, Mr Goff said.
"New Zealand had always tried to be fair minded on the Middle East, not anti-Israel or anti-Palestinian but taking a principled position."s
The principled position would be to support the bid for statehood, subject to the wording of the resolution.
"The principle is yes, a two-state solution is probably the only way forward in the Middle East and Palestinian people do deserve their own homeland."
"I guess this will be a bit of a test for where Murray McCully is at."
Mr McCully has declined to outline New Zealand's position until any resolution is public.
Palestinian president Mahmoud Abbas is expected lodge an application for statehood with UN Secretary General Ban Ki-Moon early Saturday morning New Zealand time.
Various diplomatic manoevres were being worked up yesterday to prevent it going to a fast vote at the Security Council and a promised veto by the United States, or a vote by the 193 members of the UN General Assembly.
Mr Goff said New Zealand had traditionally supported Israel because it was the underdog.
"It was the small state that was threatened by neighbours that didn't want it there but that world is way behind us now and the underdogs are the Palestinian people."
Mr Goff said Mr Abbas was a moderate.
"If his proposal is voted down is that going to help the moderate wing of the Palestinians or is it going to enhance the position of the more militant wing? I think it makes sense to work with the Abbas administration and to give them some hope."