He said the move also follows several recommendations from Independent Police Conduct Authority in reports on a number of critical incidents involving police.
The incidents included the fatal shootings of civilians Steven Wallace and Stephen Bellingham.
"Although the details are still being developed, it is anticipated that testing will be required of staff involved in critical incidents which have resulted in the death of any person or discharge of a police firearm," Mr Clement said.
"Testing may also be required where a critical incident has resulted in serious injury to any person.
"A random testing component is also anticipated involving around 500 staff a year -- both constabulary and employees -- in safety-sensitive roles."
Mr Clement said police were consulting on the policy with the Police Association and New Zealand Police Managers' Guild.
"The move to a drugs and alcohol testing programme brings police in line with other similar jurisdictions in Australia and the UK, as well as the New Zealand Defence Force and the Department of Corrections," Mr Clement said tonight.
"It also reflects testing regimes in a number of private sector organisations involved in safety-critical industries.
"While we do not believe police has any particular identified issue regarding the use of drugs or alcohol by staff, we should not think of ourselves as immune from the impact of these substances as workplace hazards."
Mr Clement said as an employer of 12,000 officers and non-sworn staff, police were "committed to, and responsible for, taking all reasonably practicable steps to provide a safe and healthy environment for all employees".
"The policy is currently being developed and we anticipate staff will be provided with a further update early next year," he said.
THE WALLACE CASE: http://www.nzherald.co.nz/nz/news/article.cfm?c--id=1&objectid=10520080
THE BELLINGHAM CASE: http://www.nzherald.co.nz/nz/news/article.cfm?c--id=1&objectid=10753948
