"Emerging powers will be denied a role consistent with the global significance. And small states will continue to be squeezed out of positions of responsibility.''
Mr McLay did not offer any view on the application last week by Palestine for recognition as a member state of the United Nations which still remains that expressed by Foreign Minister Murray McCully in August.
In a speech on the so-called "Arab Spring'' he said that while not ruling out voting for such a resolution at the general assembly, taking the issue to the UN to seek an imposed resolution was less than ideal.
And it would not work any way because it would be vetoed at the Security Council.
Mr McLay expressed the hope that the world would avoid a second and even more disastrous decline into a double-dip recession.
"We don't relish the prospect of being dragged into another recession that's not of our making.''
He cautioned against large countries "repeating the mistakes of the 1930s'' when protectionism deepened the Depression and led to war.
Mr McLay also called on the Security Council to play its part in addressing climate change.
He said that for Pacific neighbours climate change was "no abstract threat, confined tot thousands of pages of report and esoteric debate - it's a fundamental questions of existence.''
He said that when UN Secretary General Ban Ki-Moon visited the Pacific recently (Kiribati and Solomon Islands) he had experienced real "vulnerability'' when his hotel room in addition to towels and the telephone was equipped with a lifejacket.