Prime Minister John Key says Government will have to "rip up" its Resource Management Act reforms after National's by-election defeat in Northland.
Speaking to Radio New Zealand this morning, Mr Key said that there now no chance of getting majority support for changes to the Act's core principles.
"With the RMA, there's just no question that you've got to rip up what we've got now, go back to the drawing board and have another go," he said.
New Zealand First leader Winston Peters' victory in the Northland by-election on Saturday meant National could no longer pass legislation with the support of just the Act Party.
National needed another vote from either United Future or the Maori Party, both of whom opposed National's proposed changes to the core principles of the RMA.
Mr Key said these parties supported the procedural parts of the reforms, which would help with problems such as housing affordability.
But they did not agree with changes to sections 6 and 7 of the RMA.
"Peter Dunne's publicly said he won't support it and I'd be surprised if he would," Mr Key said.
"We just don't have the numbers because I can't see anybody else supporting it.
"We're going to have to go back to either what the current law is, or something else that others will agree to. But they won't agree to much change if any."
National was "effectively back to where we were in the 2011-2014 situation", he said.
Last term, National failed to get support for its RMA reforms and was forced to rewrite them.
In January, Environment Minister Nick Smith released redrafted changes to the Act. Government had hoped to pass these changes before the end of the year, but it was now back to square one.