The final report reviewing the MMP voting system - which recommends lowering the party threshold to four per cent - has been tabled in Parliament.
The report, conducted by the Electoral Commission, was an independent review after last November's referendum in which a majority of voters chose to keep MMP.
In its final report the commission has recommended several changes to the MMP system, including:
- Lowering the party threshold to 4 per cent
- Abolishing the one electorate seat threshold
- Abolishing the provision for overhang seats
- That Parliament consider fixing the percentage ratio of electorate to seats at 60:40
Justice Minister Judith Collins said almost 6000 submissions were received during the review, including more than 1000 submissions on changes proposed in August.
"The Government will now carefully consider the commission's recommendations and will be consulting with other parties in Parliament for their view,'' Ms Collins said.
ACT leader John Banks criticised the report and said his party would not support the proposed changes.
The commission's proposal to have thresholds reviewed in the future shows "a lack of confidence in its own recommendations''.
"Voting systems benefit from infrequent change,'' he said.
"Voters will not have any confidence in the electoral system if it can be continually tinkered with.''
Mr Banks, whose party has struggled to register in the latest One News Colmar Brunton poll, said the proposed changes to the 5 per cent threshold were arbitrary and that existing standards were "understood by voters''.
But Labour leader David Shearer said the proposed changes must be passed.
"The review shows that it is well and truly time to ditch the so-called 'coat-tails clause' to avoid stitch-ups like the deal done over the tea cups by John Key and John Banks last election,'' Mr Shearer said.
"That infamous moment damaged New Zealanders' confidence in MMP and we now have an opportunity to restore that trust so Kiwis can be confident the electoral system works in the best interests of the country, not individual politicians.''
He said Labour wanted the Government to move quickly implementing any changes and his party was offering to facilitate the passing of a new law for "the most important recommendations''.
Labour MP Lianne Dalziel said the thresholds must be implemented in time for the 2014 election.
"The Electoral Commission says these changes don't require a referendum, which means we need to just get on with it. The integrity of the 2014 election requires these changes be made,'' Ms Dalziel said.
The Green Party said the recommendations reflected the underlying principles of fairness, proportionality and diversity in the electoral system.
"I look forward to seeing them implemented,'' Green Party electoral reform spokeswoman Holly Walker said.
Ms Walker said the Government should respect the review and implement the recommendations.
"It's vital that the National Government does not allow the immediate political interests of any single party get in the way of changes that strengthen our electoral system in the long term,'' she said.
"This isn't about the next election; it's about the next 10 elections.''
Jordan Williams, a constitutional lawyer and a former campaigner for Vote for Change which lobbied against MMP, said he was disappointed with the commission's report.
"New Zealanders have been conned,'' Mr Williams said.
"The public voted to keep MMP with an expectation that the review would result in improvements and a more stable electoral system.
"Instead, these recommendations would make the features of MMP even worse.''
The Wellington-based lawyer said lowering thresholds was "a recipe for instability and unpredictability'' because it potentially allowed "even more small party tails to wag the dog''.
"Governing arrangements and lines of accountability are complex enough without letting more marginal parties into Parliament,'' he said.
"The commission has made no effort to address the power of party bosses to select, rank and exercise power over list MPs.
"The report ignores the overwhelming calls for transparency in list rankings.''