Teina Pora is to receive a compensation package immediately while he decides whether to ask the courts to review the decision not to adjust it for inflation.
"I can confirm that the Crown has agreed to Mr Pora's request that he receive the sum that's been approved by Cabinet immediately while still reserving his right to challenge the decision not to apply inflation to non-pecuniary losses and that decision has been communicated to Mr Pora's legal team," Justice Minister Amy Adams said in a statement this afternoon.
"It is expected that payment will be made as soon as the necessary information has been received from Mr Pora's team."
Mr Pora was awarded $2.5 million compensation and received an apology this week for being wrongfully convicted of rape and murder after being imprisoned for 21 years.
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The offer did not include an inflation component, despite a recommendation to do so from retired High Court judge, Rodney Hansen, QC, who made the decision on compensation.
Mr Pora's team say they are now considering challenging the inflation decision.
However, Mr Pora's team say their client has been asked to immediately accept or decline the offer made, meaning that if he wishes to challenge even a small part of the offer he has to first decline in full - at least in the meantime.
"We think that is unfair," they said in a statement yetserday.
"Mr Pora is under immense pressure of finances and emotion ... the decision whether to challenge this aspect is complex and will take time to reach."
The team wrote to the Justice Minister yesterday to invite her to moderate the Deed of Release to allow Mr Pora to receive the sum currently offered but also allowing him the opportunity to challenge part around inflation.